The Underground Economy: Foreclosed car

Abstract

The objectives of this research were 1) to study the underground economic model and process under a case study of foreclosed cars, 2) to estimate the transaction size of foreclosed /repossessed car trading business, and 3) to suggest the solutions for related people in a case of foreclosed cars. This study was a qualitative research. Data were collected from key informants. The sample was selected based on a purposive sampling. Only key informants were selected to meet the research objectives without the consideration of the proportion of population. From the selection, the number of  key informants was 12 individuals, consisting of foreclosed car traders, customers, professional lawyers with prior experience, and underground economy scholars that gave their consent to provide information. The researcher studied related documents and laws on the vehicle pledge offense and related trading. The results of this study showed that the business under this case study was considered as illegal underground economic and operated by connecting groups and influential persons. Three types of foreclosed car trading were found, including 1. Domestic trading, 2. Trading to neighboring countries, 3. Trading separated automotive parts. Business transactions were wrongly conducted from car pledge, car pledge receiving, selling, and part separation. Minimum business value was approximately 5,400,000,000 baht. The findings of this study could suggest that 1. a credit company should strictly inspect the loan applicant, 2. Technology should be applied to strictly inspect financial information of the applicant from finance companies, 3. More strict inspection measures of police officers and government officers should be enforced in terms of vehicle possession documents by linking with the same database, and 4.  More strict measures should be enforced for monitoring car pledge business or foreclosed car trading business via the Internet.