Curbstoning – it isn’t difficult to make hundreds of thousands of dollars in a very short time.
You’ve been searching for a reliable used vehicle for a while. Countless hours spent on the Internet perusing classifieds and numerous trips to local dealerships have left you empty-handed. You’ve even asked around at work to see if anyone is selling their car, or knows someone who might have something for sale. Your search has led to some prospects, but the pricing was out of reach or the vehicle sold so quickly that you missed out. Perhaps you’re a little worn out and tired, what seemed like an exciting purchase is turning into a lot of work.
Whether you are at the end of your rope or just getting started, the daunting task of spending thousands or tens of thousands of dollars on a used vehicle can be overwhelming. When you reach a place of desperation, uncertainty or impatience, it can be easy to rush to purchase a vehicle that pops up online and is priced competitively without doing the important research necessary to make sure you are actually buying what is being advertised.
One of the easiest pitfalls to end up in is purchasing a used vehicle from an individual who is a curbstoner.
If you just read that last sentence and thought, “What in the world is a curbstoner?” you should keep reading. Understanding this illegal practice and the risks involved can help you avoid being ripped off on your next used vehicle purchase.
What is Curbstoning?
Curbstoning is the act of selling used vehicles under the false pretense of being the car’s owner in order to evade city or state regulations imposed on authorized automotive dealers.
Flipping cars is big business. Once you understand the system and have some capital, it isn’t difficult to make hundreds of thousands of dollars in a very short time. Of course, in order to protect consumers, car dealerships face great scrutiny from local and state governments. Rules must be followed, promises must be kept and the vehicles they offer for sale must meet certain criteria. Operating a legal, well-established dealership requires the business to maintain a great reputation and clear sales records, all while keeping up to date with permits and taxes owed to the state and federal government. Reputable dealers are not in it for the fast dollar; they plan on selling cars for years to come and are willing to pay the cost to do so.
On the other hand, curbstoners work in the shadows to make the maximum amount of profit on each sale by cutting corners. These tactics include not obtaining the necessary insurance, licenses and permits, and pocketing money that should rightly go to city, state and federal government. It isn’t unusual for a successful curbstoner to sell three or four cars in the span of a few weeks by listing cars under the “for sale by owner” or “private party” sections of online classified listings. They may even invent elaborate excuses to explain why they are selling a car that they don’t have any records or history for, including the title.
“It’s my failing mother’s car,” or “My son is away at college and he asked me to help him sell his pride and joy.” The lies seem plausible, but a curbstoner will use a story to help them sell the car and make a few bucks.
So how can you protect yourself as a consumer from this unscrupulous practice? My hope is that the information in this guide will help steer clear from being the victim of curbstoning. These simple suggestions can greatly reduce the chances of falling prey to this unsavory scam.
Who is a curbstoner?
He/She is an individual who buys vehicles (may be only one) with the intent to sell them for a profit.
- Who is not a licensed motor vehicle dealer
- Does not have a local business license
- Does not pay state taxes
- Does not pay federal taxes
- Does not have any overhead
- Uses property belonging to others for display of vehicles
(Property owners can be held liable for allowing the display)
- In many cases “jumps title”, thereby obscuring the identity of the true seller and evading payment of tax and title fees
Jumping titles is a criminal offense and can be charged with a Class 1 misdemeanor, pay a fine not to exceed $2,500, and be sentenced to not more than 12 months in jail