The Gaff Hook Scam

How To Get Snagged into a Deal You didn’t See Coming.

There is a new (maybe just new to me) scam going on in the grande olde game of sales manipulation. I have seen it used in real estate sales and more recently in auto sales. It goes like this:

You go shopping, let’s say for a new car. Your visit to the dealership follows the normal course of business. First you look at some cars, you find one you like, you discuss it with your spouse and the salesman starts to perceive that you are giving him buying signals. Your interest has been incurred and he thinks you may be psychologically ready for the gaff hook.

A real gaff hook is a device used by fishermen, usually salt water fishermen, to land large fish. It is a big, sharply pointed and barbless hook affixed to a handle several feet long. When the fisherman who has the fish on the line plays it closely enough to reach with the gaff hook, the gaffer pulls the pointed end of the hook into the fish, ideally under the backbone. Then he lifts it into the boat. It makes it possible to boat a fish that would break the line if lifted by it and which is too big for a landing net.

By this point you have realized that you are the fish. The salesman has played you close to the boat by offering a generous trade-in on your old car, a good price on the new one and possibly other incentives to buy. Now he slides a sheet of paper in front of you and beckons you to sign it. That’s the gaff hook.

That sheet of paper contains an agreement. When you sign it you agree that you will buy a car (or a house in the case of a real estate scammer) but you also agree that if you fail to take delivery for any reason, you will pay the scammer all the profit he would have made on the sale. In the case of a new car it is usually five percent of the full, retail price. In the case of real estate it will be the commission the realtor would have received computed on the selling price.

If you sign that sheet of paper you have been gaffed. It then becomes time for the gaffer to start changing the deal. Your trade-in suddenly has a defect that wasn’t noticed earlier and it is now worth considerably less than the amount you were promised. Also, the new car has some features that weren’t on the invoice or some such thing and will have a higher price than you were promised. If you balk at any of these changes the gaffer will bully you with that piece of paper which says that if you don’t accept delivery of a car you will have to pay the crook a nice piece of change for which you will receive nothing. The bullying will likely include a threat to sue.

It’s cute and it’s clever and it’s travelling around the country.

The countermeasures are obvious. Firstly, never, ever sign anything without reading and understanding it and secondly, never, ever, ever sign anything without getting a copy to take with you. The sleaze-ball with the gaff hook contract will refuse to give you a copy because it documents his crooked game.

I said the gaffer will use the gaff contract to bully you and that may be all he will be able to do with it. The enforceability of such a deal is questionable anywhere, though its enforceability may vary from state to state.

First, there is no consideration for your agreement except the salesman’s agreement to sell you a car on his terms. He’s there all day to do that anyway and just talking to a prospect about selling a car is not usually considered a value to the prospect. A contract that lacks consideration on either side is not an enforceable contract.

This crooked scam also looks a lot like a kind of contract that is famous for being unenforceable: an “agreement to agree.” If a contract only imposes an obligation in the event that you will, at a later time, agree to some terms then it is not a contract at all. Mutual agreement is one of the essential elements of a contract and an “agreement to agree” is not agreement.

If you get caught up in this kind of scam you will have to see a lawyer in your local jurisdiction to find out exactly what the rules are there.

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