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By Martha C. White
March 11, 2021
A phone surrounded by text messages that say  Hello your car warranty is about to expire
Vanessa Garcia / Money; Getty Images

Based on the contents of our voicemail inboxes, you might think every American is driving around a clunker that's one rattling bolt from disintegration.

Over and over, sometimes multiple times a day, we hear that our “car warranty is about to expire” — but if we just press “one” at the prompt, a pleasant female voice assures us, we can rectify that by purchasing an extended warranty.

The spiel, which usually comes in the form of a robocall, is what the experts call a “legacy scam" — that is, it’s been around for years. But 2020 brought on a used car boom, with millions of cooped-up social distancers flooding the market, and an abundance of scam calls followed.

Now the calls are so prevalent that even the people who fight scam artists for a living want to throw their hands up.

“It’s a problem,” says Amy Nofziger, a fraud expert for the AARP. “We’re all getting these phone calls.”

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Why car warranty calls, specifically?

As the COVID-19 pandemic stretches into year two, our collective disposition has worn thin.

"We’re already under anxiety and the scammers know this,” Nofziger says. Many are cynically calculating that the financial stress so many Americans are facing today might make them receptive to a pitch that promises a hedge against future unexpected expenses.

Between June and December of last year, Americans logged more than 197,000 Do Not Call complaints about unwanted robocalls pertaining to car warranties and protection plans, according to the Federal Trade Commission’s (FTC) interactive data tool. The actual number is almost certainly higher, since most people don’t drop what they're doing every time they get one of these calls and file an FTC complaint. The more people get wise to their grift, the more annoying perpetrators have to be to find new victims, hence the recent uptick.

With this particular scam, people are led to believe they’re buying an extension of their car’s existing warranty. This is a deceptive sales pitch. In reality, the so-called warranty they’re selling—for hundreds or even thousands of dollars—probably won’t be honored by the dealership where the customer bought their car, or at any private auto body shop. Sometimes there's no warranty at all.

It's difficult to bust these scammers, Nofziger says, since most victims don’t realize they’ve been hoodwinked until weeks or months later, when their car breaks down and they realize their new “warranty” is worth about as much as the paper it’s printed on. The more time that’s elapsed since the scam call took place, the harder it is for law enforcement agencies to track down its source.

Who are these scammers?

Both the FTC and the Federal Communications Commission (FCC) have been playing whack-a-mole with the operators who run car warranty scams for years. (The FTC banned most pre-recorded telemarketing calls back in 2009, though there are exceptions for political calls, charitable solicitations and debt collections). They originate from within the U.S. as well as overseas: FTC enforcement actions from 2012 reveal a globe-spanning web of crooks that has profited off unsuspecting car owners. Investigators tied the California-based operation to a bank account in Hong Kong, real estate holdings in mainland China, plus land, cars and other assets the FTC seized as part of the settlement.

These crooks are adept at using technology to cover their tracks, with manipulation tools like caller ID “spoofing” to fake who they are and where they’re calling from. Which is why you might get a call from a scammer that shows up on your phone as the manufacturer of your vehicle, or something like “auto warranty department.”

Scammers’ reliance on spoofing tools is usually carried out with the help of voice over internet protocol (VoIP) technology, which does give regulators another avenue to crack down on scammers when they use VoIP providers based in the U.S.

Will Maxson, an attorney with the FTC’s bureau of consumer protection, says the agency has specifically targeted VoIP providers that facilitate robocall spam operations. Shutting down these bad operators can prevent the calls from going out to people’s phones in the first place, according to Maxson.

“We want to enforce the law against everyone in the ecosystem of illegal telemarketing,” he says.

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How can I get them to stop calling me?

Experts have a few tips for how to eliminate — or at least cut down on the number of — these calls.

You can—and should—sign up for the Do Not Call registry. It won’t actually block the calls, but registering allows you to file a complaint when you get one. The FTC and the FCC use this information to build cases against perpetrators. (Maxson points out that if you’re on the registry and you’re still getting spam calls, that’s a really big clue that the person dialing you is up to something illegal, since legitimate organizations are supposed to honor that list).

If you’re getting robocalls on your smartphone, both iOS and Android have features that let you customize your call filtering options to sift out spammers. Major mobile providers like AT&T and Verizon also offer call-filtering tools. If you’re still being inundated, there are a slew of third-party apps like YouMail and Nomorobo that promise to cut down on annoying robocalls.

If the robocalls are coming to a landline phone, you’ll probably want to contact your carrier: The FCC has a running list of links to the major telecom providers in the U.S. to get you started.

Nofziger, for her part, reiterates the importance of never giving out personal information to an unsolicited caller. While most car warranty scammers just want to sell you a worthless piece of paper, there’s always the chance that they’re trying to collect information for more insidious crimes like identity theft or credit card fraud.

“We really do recommend people not engage,” she says. “Better yet, unless you know who's calling, don’t pick up the phone.”

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