Dealership Fraud Surges as Digital Vehicle Purchases Increase

Nearly half of dealers lost 4 or more cars to identity fraud in the past two years

Feb. 2, 2026 at 9:47am

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According to a new survey by eLEND Solutions, identity and fraud-related activities have increased significantly in the retail automotive industry over the past two years. 77% of auto dealer respondents reported seeing a growth in fraud-related activities, with 48% losing four or more vehicles to identity fraud in the past two years. The data suggests that the increasing digitization of the vehicle purchase process is a major factor driving this surge in fraud.

Why it matters

The rise in dealership fraud is a concerning trend that highlights the vulnerabilities created by the shift to more digital and remote vehicle transactions. As more of the purchase process moves online, identity thieves have more opportunities to exploit weaknesses in dealer verification systems, leading to significant financial losses for dealerships.

The details

The survey found that 41% of dealers experienced identity fraud vehicle losses in the past year alone. Over one-third of dealers said that 40% or more of the fraud they've seen is related to the increase in remote/digital purchase transactions. Fake driver's licenses were cited as the top reason for the increase in vehicle purchase fraud by nearly half of respondents. Dealers are increasingly worried that as the vehicle transaction process becomes more digital, identity fraud will continue to grow and be even more challenging to prevent.

  • The survey was conducted online among self-identified auto dealers in late 2025.
  • The data covers the past 24 months, from 2023 to 2025.

The players

eLEND Solutions

An automotive FinTech company providing a vendor neutral, API-based middleware solution for connected retailing, specializing in hybrid credit, identity verification, and 'pre-desking' finance solutions.

Pete MacInnis

CEO and Founder of eLEND Solutions.

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What they’re saying

“This is a snapshot of the onslaught of fraud auto dealerships are experiencing in all aspects of their business, much of it a result of the increasing digitization of the auto purchase process.”

— Pete MacInnis, CEO and Founder

“Unfortunately, the problem is increasing because too many dealers rely on driver's license scanners that lack forensic authentication and DMV and PII data matching. As fraudsters become more sophisticated, and AI is poised to inflate fraud schemes, it is critical that auto dealerships equip themselves with tools that are able to dive deep into data to ensure that their customers are exactly who they say they are.”

— Pete MacInnis, CEO and Founder

What’s next

eLEND Solutions' Identity Solutions, including ID Drive, ID Drive Mobile, Identify, DMV Data Match, and 700Credit Identity Verification Platform, have prevented over $1 Billion in potential identity fraud annually since 2022. 2026 NADA Show attendees can learn more about the survey findings and explore how eLEND Solutions is addressing identity fraud in an increasingly digital retail environment at the Las Vegas Convention Center, West Hall Booth #4951W, just south of the Toyota exhibit, February 4–6.

The takeaway

The surge in dealership fraud driven by the shift to more digital vehicle transactions highlights the critical need for auto dealerships to invest in robust identity verification and fraud prevention tools. As fraudsters become more sophisticated, dealers must prioritize protecting themselves and their customers from the growing threat of identity theft and related financial losses.