When you buy a car that is financed, usually the deal is they get a pay out figure from the bank, they tell you, you verify it with the bank, and make the bank cheque out directly to the creditor, with the rest going to the seller.
The bank cheque is useless to the guy, he has to pay the loan off with it, if he doesnt, the bank cheque is never cashed and it can all be worked out.
But sorry to hear about it, theres too many dodgy types around, and the down side is that the bank can handle losing that much money, while it makes a big difference to you, and who gets the first pick at assets, the stupid bank.