State regulators are renewing an urgent consumer alert regarding a wave of Facebook Marketplace scams targeting vehicle sellers across Tennessee, leaving victims without their cars, their money, and often any hope of insurance reimbursement.

According to the Tennessee Department of Commerce & Insurance, fraudsters are weaponizing peer-to-peer marketplaces to execute elaborate vehicle thefts. The scheme typically unfolds in several key stages:

• The Setup: A scammer contacts a private party listing a vehicle for sale, agrees on a price, and may even go as far as contacting the seller’s bank to feign legitimacy.

• The Phony Payment: The buyer provides fraudulent funds, utilizing either a fake wire transfer or a counterfeit cashier’s check to complete the transaction.

• The Handover: Believing the payment is secure, the unsuspecting seller hands over the vehicle—sometimes meeting the buyer in person. Days later, the bank catches up, the cashier’s check bounces, or the wire funds are rescinded, leaving the seller with worthless paper.

Officials warn that the financial devastation is frequently compounded by insurance policies. Most standard auto insurance contracts contain anti-fraud provisions that render owners ineligible for theft coverage if they willingly hand over their keys and vehicle to another person.

Consumer advocates urge Tennessee residents to exercise extreme caution when conducting private vehicle sales online, verify funds are fully settled through their financial institution before releasing any property, and remain vigilant against sophisticated peer-to-peer fraud tactics.