You might be surprised how this could turn out.
One of my customers was involved in what looks like identical circumstances earlier this year. He gave his car to a garage on sale or return. He retained the V5 in his possession.
Was fobbed off for several weeks by the garage saying they had someone interested but they wanted to test drive again, then they wanted their wife to look at the car etc.
Garage went out of business and it turned out the vehicle had been sold two months previously. The new owner had a V5 issued by DVLA in his name and had bought the vehicle on finance. As he bought the vehicle from the motor trade he retains good title on it. My customer can't get his car back.
The Police investigated allegations of fraud but concluded no crime had been committed. The garage didn't steal the vehicle. They did exactly what they were asked to do...they sold it.
Of course, they were going to transfer the money to my customer but sadly they went out of business before that could happen. The lies they told were an attempt to improve their cash flow and trade through their financial difficulties - no crime in that. My customer becomes a trade creditor along with everyone else.
To top it off, as there has been no crime, there is no prospect of a theft claim on his insurance.
Oh, and this was a £20k Audi.