Americans are on track to file more fraudulent auto loan or lease reports this year than ever before — complaints are up 71% so far from 2024. Here’s how to protect yourself from scammers

Auto loan fraud is more common than you'd think

Identity theft related to auto loans and leases occurs far more often than you might expect. In 2024, the Federal Trade Commission fielded 60,189 claims. This was a 16% increase compared with the prior year.

Things aren't looking any better this year either. FTC data reveals 21,446 of such auto lease or loan identity theft reports were filed in the first quarter of 2025 alone, up a whopping 71% from the same time last year. If this trend continues, 2025 will see a record number, according to CBS New York.

Synthetic identities, which combine a real person’s information like their Social Security number or date of birth with false information, are a growing problem due to generative AI. At the end of last year, $3.3 billion in auto loans, bank credit cards, retail credit cards and unsecured personal loans were held by such fake identities, according to a TransUnion report.

The kind of identity theft that Simon experienced can have damaging effects on a victim's credit score, ability to borrow, and financial well-being.

Lucas Gutterman, a consumer advocate at the U.S. Public Interest Research Group, said that the one bright spot in Simon's situation is that he got a denial letter on the loan.

"If it had been accepted and someone who is a criminal had gotten access to that line of credit, that could cause some serious damage by affecting the credit score or just affecting the debts that this person owed,” he told CBS New York.

Still, the repeated credit inquiries are a hassle — and one with real-world financial consequences. Simon explained the incident was "ruining my credit score."

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How can you protect yourself?

To avoid becoming a victim of auto loan identity theft, it's important to keep all your identifying information safe.

Don't share personal details like your Social Security number on the internet or on the phone. It could be a scammer pretending to be your bank or a government agency. If something seems off — even at a dealership — don't provide your Social Security number, as you don't want it misused to apply for credit you don't want, like Simon experienced.

Simon received notifications when his credit was checked. It's a good idea for everyone to sign up for these kinds of notifications so they will know right away if something is wrong.

You should also regularly review your credit reports. If you suspect someone may be trying to steal your identity, you can place a credit freeze on your credit reports. You would have to contact each of the three credit bureaus — Experian, TransUnion, and Equifax — to do this.

By taking these steps, consumers can reduce the chance of becoming a victim even with auto loan fraud on the rise — and they can avoid the hassle and potential damage to their credit that goes along with it.

Gutterman, and other consumer advocates, also suggest reporting any suspected fraud both to the Federal Trade Commission and local police so the scam can be properly documented and investigated — and to raise awareness to potentially help others from becoming victims as well.