Is that used car you're buying being sold by an illegal dealer?

Is that used car you're buying being sold by an illegal dealer? »Play Video

PORTLAND, Ore. - Some people say they prefer to buy cars from private sellers rather than dealers because they believe they will get the true story behind the car and a cheaper price. But in the Portland area some private owners could be illegal dealers in disguise.

Nick Butkovich advertised a 1981 DeLorean on Craigslist and said he’s “moving must sell” and is the car’s second owner. But a KATU Problem Solvers investigation found that Butkovich is not a private seller but an illegal dealer, and he posts often on Craigslist as a private owner, saying ”moving must sell,” and “safe and reliable car”.

Nathan Wyllie said he bought a Jetta from Butkovich at a low price based on claims that it was a good quality car.

“The guy said he needed money because he was moving,” said Wyllie. “It seemed like a legitimate story at the time.”

But he said the car was not safe and reliable. He tried to get his money back but couldn’t.

“It just became increasingly apparent that he wasn’t moving, and I’d been swindled,” Wyllie said.

He won in small claims court but Butkovich has never paid up.

“He’s not a very honest person, and it’s unfortunate,” said Wyllie.

Some of Butkovich’s neighbors said he’s not moving but is instead running a mini-dealership out of his Clackamas apartment complex.

He also has no dealer’s license.

Who needs a dealer’s license? According to the DMV, there is no magic number of cars sold per year but anyone selling cars for profit, instead of just their own personal car, need’s a dealer’s license, needs to register with the state, needs to get a $50,000 bond, and can only sell from their registered business address.

“I would be very wary if someone wants to meet you in a parking lot somewhere,” said insurance investigator Dale Gesner. He said rogue sellers can cause problems because some sell cars that have been wrecked and repaired badly.

“Instead of replacing the airbags, they just stuff newspapers in there,” Gesner said. “You won’t know it until you get in an accident, and the airbags don’t deploy.”

Additionally, some sell stolen cars with fake VIN numbers.

Gesner said he believes buying from someone with a dealer’s license will help protect the buyer.

“If the police show up at your door in a week or two and say it’s a stolen car, you want to tell them who you got it from. You want to get your money back,” said Gesner.

The KATU Problem Solvers tracked Butkovich to a parking lot by his home and, after a reporter identified herself, said he couldn’t talk about car sales and appeared perplexed about car sales.

Records show the 1981 DeLorean has had more than two registered owners and Butkovich is not one of them.

When asked to produce the car registration, Butkovich said, “I don’t have it with me, actually. It’s back at the house, but the car is in my name.”

According to the DMV, it can be hard to catch illegal sellers because they don’t leave a paper trail; however, they have caught Butkovich and fined him more than $50,000 for 21 counts of selling cars illegally.

But he’s never paid up.

According to the state, it’s only a civil penalty so it can’t force Butkovich to pay or make him stop selling cars.

He denied selling any other cars, but a KATU News undercover camera caught him trying to sell a 1994 Honda just a few weeks before.

Experts say car buyers should take a car to a mechanic first and get a car history report online before they buy.

Gesner, the insurance investigator, recommends car buyers get all the details about the seller, not just the seller’s first name. Buyers should ask to see the seller’s driver’s license before they buy, and if the seller won’t produce it, Gesner said car shoppers should walk away.