The Tennessee Department of Commerce and Insurance (TDCI) has issued a consumer alert about a rising number of auto scams on Facebook Marketplace, where fraudsters target vehicle sellers. In the typical scheme, a scammer contacts a seller posing as an interested buyer, negotiates a price, and may even involve discussions with the seller’s bank. The fraudster then provides what appears to be payment through a fake cashier’s check or a phony wire transfer, sometimes showing fake confirmation.

Believing the funds are legitimate, the seller hands over the vehicle—often meeting the buyer in person—only to discover days later that the check has bounced or the wire has been reversed, leaving them without the car or the money. Adding to the hardship, most auto insurance policies include anti-fraud clauses that deny theft coverage when the owner voluntarily gives up the keys or vehicle, as explained by TDCI Commissioner Carter Lawrence, who urged consumers to carefully review their policies to understand coverage limitations.

To protect themselves, TDCI recommends verifying cashier’s checks directly with the issuing bank, ideally by meeting at the bank for in-person confirmation, or waiting several business days for wire transfers to fully clear before releasing the vehicle. Other tips include running vehicle history reports like NMVTIS and CARFAX to check titles and histories, preferring sales through licensed dealers, trusting instincts if anything seems suspicious, and slowing down the process to allow thorough verification.

The agency also highlighted related online auto scams, such as VIN swapping, fraudulent titles, odometer tampering, and selling salvage or stolen vehicles, noting that scammers rely on rushed, trusting transactions. Consumers suspecting fraud should report it to the Tennessee Attorney General’s Consumer Affairs Division.