Five cars were swiped from this dealer group. Your store could be next.

Benoit Ford and Benoit Nissan, auto dealerships in Vernon Parish, Louisiana, recently fell victim to a cunning fraud scheme that resulted in the theft of five vehicles. To make matters worse, the dealerships’ cyber insurance policy would not cover the loss. In this blog post, we’ll share what happened and how you can protect your dealership from a similar fraud attack.

The perpetrators engaged in online vehicle purchases using fake or stolen identities. The process involved submitting credit applications to lenders, followed by electronic or overnight mail completion of paperwork between the buyer and dealerships. The lenders only discovered the fraud when payments were not received for the vehicles, at which point they demanded reimbursement of the purchase price from the dealerships.

Seeking relief from their losses, the dealerships turned to their cyber insurance policies. However, the insurers denied coverage, leading to a legal dispute (Benoit Ford LLC v. Lexington Ins. Co., No. 2:22-cv-06024-JDC-KK). A Louisiana federal court ultimately ruled in favor of the insurers, stating that the dealerships' contractual obligation to repay the lenders did not qualify as a claim under the cyber policy.

Clearly, there is a crucial need for heightened awareness and proactive measures to protect auto dealerships from similar outcomes. Enter Gather, a technology company designed to solve this problem, and more, for retail automotive dealers with a simple 50 second consumer process.

Here’s how Gather works: When the customer is ready to buy a car, they scan a QR code in the dealership and are prompted to take photos of their driver’s license, their insurance card and themselves. Gather’s technology then goes to work, running a series of tests to prove the consumer’s identity and active insurance status, answering critical questions:

• Biometric ID Verification: Does the customer pass ID verification protocols?
• Purchaser’s Match: Does the information on the IDs presented match the information in the deal record?
• Document Validation: Do the consumer’s documents pass authentication standards?
• Device Fraud Scan: Does the consumer’s phone number appear on any registered fraud watch lists?