Ops Luxury: JPJ Seizes Sambung Bayar Camry, Owner in Legal Trouble

Sambung bayar schemes, where a car is sold before the bank loan is fully paid, continue to pose serious legal and financial risks for Malaysians, authorities warn.

The latest incident occurred in Kedah, when a Toyota Camry Hybrid was confiscated by the Road Transport Department (JPJ) during an Ops Luxury operation at Kilometer 1, Jalan Sungai Ular–Taman Bestari, Kulim. 

Officers found the vehicle operating without valid road tax or insurance, and issued a P22 summons along with a confiscation notice under Section 64(1) of the Road Transport Act 1987. The car was taken to JPJ’s Kulim depot for further action, according to a post on the state JPJ Facebook page.

JPJ stressed that vehicle owners remain responsible for ensuring road tax and insurance are valid, even if someone else is using the car under a sambung bayar arrangement.

“This type of deal is illegal and carries significant risks for both parties,” it says.

Sambung bayar schemes work by having a buyer pay a deposit and continue monthly instalments on a vehicle still legally owned by the seller and the bank. 

While it may seem attractive for both sides, the practice is considered fraudulent under the Hire Purchase Act 1967. Offenders can face fines of up to RM30,000 and/or three years’ imprisonment.

Legal experts also note that contracts for sambung bayar arrangements are unenforceable under the Contracts Act 1950. This means if a buyer stops paying or disappears, the seller is still liable for the loan, road tax, summons, and insurance. 

Buyers are not legally protected, and ownership of the vehicle remains with the original owner until the hire-purchase loan is fully paid. Authorities also warn of additional dangers, including cloned vehicles, tampered mileage, and unverified cars, which could result in confiscation or fines under the Road Transport Act 1987.

“Always complete the ownership transfer to avoid legal, financial, and insurance issues,” authorities advise.