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Dob in a backyard dealer

Reporting unlicensed dealing

Motor vehicle dealers, their yard managers, their salespersons and their dealer premises must be licensed by the Commissioner for Consumer Protection.

Licensed motor vehicle dealers must purchase or rent authorised premises, must undergo training, and possess a great deal of knowledge about the law before they can start operating their business.

As a result, establishing and running a dealer business can require a great deal of investment in time and money.

The advantage of this system for you is that dealer conduct is regulated and monitored. Dealers are required to give warranties on used cars and must market their products in a truthful and ethical manner.

By comparison, backyard dealers do not hold licences and consequently do not incur the cost of establishing and running a proper business and do not abide by the same laws regulating licensed dealers.

Backyard dealers buy and sell vehicles from residential or other non-business premises. They often have a well organised operation to obtain vehicles to resell. These vehicles are often bought as wrecks, repaired "on-the-cheap" and resold in private sales to unsuspecting consumers.

The backyard dealer avoids detection by not being licensed with the appropriate authorities for the payment of fees such as vehicle transfers, stamp duty and GST.

The unfair advantage gained by these people operating outside the law impacts directly on the car-buying public and affects the livelihood of licensed dealers. Consumers are left with little or no protection if something goes wrong with a car bought from a backyard dealer. The chance of a problem arising is increased, as the vehicles sold by unlicensed dealers are often subject to shoddy, sub-standard repair work.

You can often identify a backyard dealer by seeing the same private or mobile telephone number in the newspaper or the Quokka paper advertising different cars for sale, or by driving past a house which constantly has cars for sale on the front verge.

If you believe that unlicensed dealing is occurring, you can make a complaint to the Commissioner for Consumer Protection. A person convicted of unlicensed dealing now faces a maximum fine of $50,000.

To make a formal complaint to the Commissioner for Consumer Protection, click here