Be Aware Of Companies Offering Fake Loans

The Citizens Advice Bureau is warning people to be aware of companies who often prey on those already in debt offering fake loans for a fee.

According to the CAB, the fake loans are advertised on the internet or sometime offered in a cold call or text. The offer is made to lure victims in with the promise of access to a loan giving cash quickly and easily and on favourable terms.

They are persuaded to pay money up front as a set-up fee, anything from £35 to £2,000, and are often asked to hand over their bank account details too. The loan they have been promised fails to materialise, the loan company often cannot be contacted, and the money already paid is usually lost for good.

Clearly not only is there the loan scam itself, by giving up bank account details, victims are opening themselves up to the risk of identity fraud.  You can buy identity fraud protection insurance to help should your personal information find its way into criminal hands.

If you are facing debt problems it may be time to get debt advice, either from such as the Citizens Advice bureau or other professional debt advice companies.

Advice from CAB on fake loans includes

• Never pay money up front
• Never give out bank account details to cold callers
• Be very wary of cold calls offering loans, and internet sites offering quick and easy credit
• If it looks too good to be true it usually is
• If you need credit, shop around, use a trusted source and always check the paperwork
• If you’ve already paid money up front for a non-existent loan, inform Trading Standards. The Consumer Credit Act says that all but £5 of any brokerage fees should be refunded if no loan is taken up within 6 months.
• If you suspect a scam or fraud, report it to Action Fraud 0300 123 2040, the National Fraud Authority’s reporting line.
• Get free, confidential, independent debt advice from any Citizens Advice Bureau.