How Car Rental Companies Scam People Out of Money

Fake Rental Car Company Scams

Earlier this year, there were warnings in the news from the Federal Trade Commission (FTC) about how that car rentals became a hot commodity this year. So much so, that it led to a rental car shortage. And as a result, this in turn led to an increase in the number of scams from fake rental companies that looked like the real thing, and offered some attractive offers with unusually low rental rates.

Long story short: it’s a common scam asking people to pre-pay for the rental with a gift card or prepaid debit card. The lesson here was to make sure that before renting from a suspect car rental agency to check whether it is legitimate by:

• Researching the rental car company online using keywords in your search to include the company or business name along with “scam,” “complaint,” or “review” and see what turns on Google.

• Verifying deals with the company's customer service directly. Don’t rely on a search engine result--- scammers can pay to place sponsored ads in search results at the top or in the sponsored ad section of search results. Instead, look for actual contact info for customer support on the company’s website.

• Paying with a credit card if possible in person, and never pay with a gift card or prepaid debit card---once you fork over the number and PIN, the money is gone.

Real Rental Car Company Scams

While the FTC website focused on fake car rental scams, what was interesting was a comment posted by someone who posed the question whether legitimate car rental agencies were guilty of scamming their customers by skirting the gray areas of car rental agreements.

According to the post made just a few days ago:

This isn't a scam per se but it is a deceptive business practice: A couple of months before my trip I reserved a car with Enterprise through Expedia and it came out to a daily rate of ~$70 per day. The week of my trip I decided I wanted to pick up the car one day earlier. I called Enterprise and they said no problem. However when I picked up the car the daily rate was now more than double what I was originally quoted, not just for the additional day but for the entire existing reservation as well. Apparently when you modify a reservation they use that as an opportunity to change the whole reservation to the current daily rate.

This is not surprising. Especially since I was recently scammed by a well-known health care organization with a phone scam while placing an appointment for medical treatment. I was told that by taking care of my in-patient paperwork ahead of time over the phone, that I would not have to wait and fill out the typical “clipboard info dance” in the waiting room, and that it would get me in the doctor’s office quicker by doing that.

A month later, I received a bill that included a mysterious $100-even on my bill labeled as a “convenience charge.” It took some time to figure this one out, because no one in billing would fess up when asked. Eventually, however, it turned out that it was a trick to pay for “extra care” as part of my visit. In other words, it was the medical equivalent of a “Fast Pass” at Disney. Doh!

I digress, but I feel better somehow.

Back to Car Rental Scams

As it turns out, the posted complaint about the unexpected Enterprise car rental charges is small potatoes in comparison to much worse scams perpetuated by many car rental businesses.

Looking into car rental scams, I discovered how lucky I have been in the past. I knew enough to never buy into a rental agency’s insurance; and instead, made sure I can use my personal car insurance plan. Money saved---right?

Well…that all depends.

For my needs and vehicle types I typically rent, it works out okay…but it is still risky.

As it turns out there are exceptions to all agreements and wording that is practiced deception. For example, the words “coverage” and “insurance” although used interchangeably by most of us, are two different things that are gotchas in the agreements when something happens to the rented vehicle. In addition, the definition(s) of “careless or unlawful driving” can mean pretty much anything the car rental wants…after something happens to the rental.

However, what if I ever rented a “Luxury” of “Exotic” vehicle from a car rental. Sure, you can imagine that your insurance may not cover those type of rentals, but what if you rented a Ford Explorer? It might in fact be considered to be an “Exotic” vehicle rental without your even realizing it, all because the fine print might define all vehicles with an MSRP over $50K as an "Exotic" vehicle. You can imagine the horror stories that can…and do result.

That said, for more information about these type of scam practices by legitimate rental car businesses, here’s a very informative eye-opening YouTube channel video from an exotic rental car business owner and creator of the SuperSpeedersRob DVD series, Rob Ferretti, who explains how rental companies scam people out of money.

And finally…

If you have ever been scammed by a car rental service, please let know us about it in the comments section below. I am fairly certain we’ve only scratched the surface of this problem for car enthusiasts and general commuters.

For more articles about scams, check out the most important used car scam everyone should be aware about, and a warning to used car buyers about Certified Pre-Owned (CPO) car scams.

Timothy Boyer is Torque News automotive reporter based in Cincinnati. Experienced with early car restorations, he regularly restores older vehicles with engine modifications for improved performance. Follow Tim on Twitter at @TimBoyerWrites for daily automotive-related news.