Loan Fraud Prevention CHECKLIST
- If you are considering taking out a loan then use a reputable company.
- If the company is based on the internet, research it on the internet. Find out what other people think.
- If necessary visit the loan company in their offices (although be aware that fraudsters can use serviced offices).
- Never send money upfront in order to receive a loan and be particularly wary if you are asked to use cash vouchers.
Example of Loan Fraud
Operation Sterling has become aware of a growing trend where people are being cold called on their home or mobile numbers by people offering quick, easy and unsecured loans.
The following example is typical;
- You search the internet for a small loan e.g. £1500 and enter relevant details e.g. the amount and your contact telephone number.
- A fraudster calls claiming to be from a legitimate loan company and offers you the loan. They obtained all your relevant details either through the details you entered when searching for a loan on the internet or by some other means. They sound professional and believable.
- However, the fraudster tells you that before the loan can be paid into your account, you need to pay them a one off fee. They request payment using cash vouchers – e.g. UKASH or 3V.
- You purchase the voucher (e.g. for £92 and tell the fraudster the voucher number) who then immediately cashes it.
- A short time later – as little as 1 hour – the fraudster calls again stating that tax on the loan needs to be paid before the loan can be released. Again, you are requested to obtain a cash voucher (e.g. for £145). You may be informed that once this tax is paid the loan amount and the tax (in this example £1500 + £145) can then be paid immediately into your account.
- A short time later (in this example the following day) you receive another phone call from “Head of Finance” stating the bank would not release the sum of £1645 and that the amount had to be a round figure. Therefore they require a further cash sum (e.g. a UKASH voucher) of £155 to make it £1800 and the £300 will be refunded.
- Still no money is paid into your account. You receive a further phone call stating that the money is locked in the bank and to release it a further cash voucher of £150 needs to be paid. You pay this.
- Again, no money goes into your account. The following day you receive yet another phone call and told that the bank will not release the funds and the only way to receive it is to obtain a cash voucher for £250 so that a solicitor can deliver the money in person. You realise this is a fraud and that you will never receive any money.
In this instance the victim paid £542 to the fraudster and received nothing in return. In the examples that Operation Sterling has seen the fraudster often has an Asian accent and is fluent in English.