Watch Your Back: Car Rental Scams Exposed

We’ve all seen the media coverage on the “scams” that rental car companies perpetrate on their clients. Yet how often does the public know about the indignities that befall car rental operators?

The car rental industry has experienced more than its fair share of cons pulled on it by unscrupulous customers, deceitful employees and even municipalities looking for easy tax targets to raise money for unrelated civic projects.

Here is an “around-the-world” view of some of the scams that befall car rental companies and tips on ways to prevent them. How many do you recognize from personal experience?

From the Outside In: Scams Generated by Car Renters

• The client rents a car and swaps parts from another vehicle, such as tires, airbags, batteries, wheels and even interiors. The client returns the rental and the agency is none the wiser.

TIP: This is all about good check in-and-out procedure. Don’t let your agents sit behind the counter and point out the stall number when the car goes out. When it comes back, don’t let them simply take the word of the customer. They must get off their chair and out the door!

• A thief gets into a car on the ready line, makes friends with the security folks at the gate, and simply drives off with a car.

TIP: Are you ‘testing’ your security procedures constantly? Do you have your security crew under video surveillance? Are you using “secret renters” to probe your weaknesses? If not, start.

• A long-time commercial account renter loses his job, yet still knows the “right thing to say” in getting a rental car on his former bosses’ tab. He then disappears with the car.

TIP: Make approving all rentals in advance part of your process. Address these issues in advance when setting up the corporate account. Challenge your corporate clients to think through security from both their and your perspectives. There’s no better time to bring this subject up than when you close the sale. It shows that you take the account, and the account’s processes, seriously.

• The existing customer calls the day before the car is due back, building trust, informing that they’ll need the car “just one more day.” Of course, the customer’s intention is to make off with the car for an extra week or three.

TIP: Management must be advised of all overdue vehicles, regardless of time overdue, personal relationships with clients or other excuses. “What management inspects, employees expect.” If they know you are serious about running your business by the book, they’ll avoid this trap.

• An insurance agent writes bogus policies to friends. The friends then weave their way through the car rental companies’ loss prevention policies to rent cars.

• A “claims adjuster” calls with just enough claim information to get a “direct bill” authorized for 10 days. The car is then rented to the “insured” who takes off with the car for parts unknown.

TIP: Insurance replacement deals, for smaller operators, are pretty rare occurrences. When an IR deal shows up, it pays not only to dig into the renter’s situation, but also turn it into a sales call. Scams such as the “bogus policy” play are easy to unravel if you are aware of them. As Ronald Reagan said, “Trust, but verify.”

• A call comes from an airline that authorizes its stranded employees to rent cars. “Just bill the airline,” the caller says. The customer shows up with bogus ID and takes off with a car.

TIP: Dig, dig, dig! It’s great when a new piece of business just shows up at the door, but you must dig further into who’s renting, who is going to pay and making sure to get purchase orders.

CONTINUED:  Watch Your Back: Car Rental Scams Exposed
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