Cases Of Car Finance Fraud Declining

Car finance fraud experienced a 14 percent decline between 2009 and 2010, according to new research revealed by the Finance and Leasing Association (FLA). This is positive news, especially since more cars were financed during 2010 than in the previous year.

Lenders are more committed than ever to combat this crime and this is reflected in the statistics.

During the 12 months of 2010, 832 vehicle fraud cases were reported, with a total value of £14.6 million. Car finance companies managed to recover 40 percent of the cars attained through fraudulent activities.

They did so by collaborating with local police units and conducting investigations on their own. FLA Head of Motor Finance Paul Harrison commented that the industry has a good recovery rate for these vehicles.

In 2010, it is believed that more than 9,000 cases of attempted or suspected fraud were prevented by finance companies that are members of FLA. Should these transactions have gone through, the impact would have been an additional £116 million.

Mr. Harrison revealed that organized crime is often funded by vehicle fraud.

The FLA provides support to the police by funding the ACPO Vehicle Fraud Unit, which was recently dropped from the government funding list. This unit is currently in its fourth year and has recovered more than 900 vehicles worth a total of £15.5 million.

Thanks to continued FLA member funding, the unit will remain operational, helping to keep good and bad credit car finance affordable.

Mr. Harrison reports that though it is almost impossible to eliminate fraud, dealers and lenders do their best to prevent it. They each carefully review all credit applications before they approve car loans.

Mr. Harrison expressed his hope that the Home Office will find alternative sources of funding for the remaining areas of the ACPO Vehicle Crime Intelligence Service, for which government funding has also been discontinued.