Vulnerable people targeted by online loan fraud ahead of Christmas
The victim may be pressurized into making an advance payment immediately, often on the basis that the loan offer will be withdrawn if the fee is not paid.
As we enter the Christmas season, people are being warned not to avail of unsecured loans on the internet.
The Christmas period brings many wonderful things with it but for many it also brings financial worries.
A popular time to seek small loans, frauds are targeting financial vulnerable people.
Gardaí are warning the public that a number of websites offering unsecured loans to people who have difficulty accessing loans from established financial institutions.
In these cases of Advance Fee Fraud, the victim finds a website that offers loans that will be processed quickly and without security.
The loan applicant will submit an online application and within a very short time - often just minutes later - they are contacted by the company to say their application has been approved.
They will be told the amount of the loan, which often is more than what was originally sought, and the monthly repayment.
The victim is then asked to send a small amount of money to the lender in advance of the loan being issued. The reasons given for this payment include a set-up fee, payment for Personal Protection Insurance on the loan amount or the first instalment of the loan in order to demonstrate the ability to meet the repayments.
After the payment is transferred, the loan is never issued and the advance fee is lost.
In one reported incident, a person in Dublin applied to a company for a loan and were asked to forward a deposit €680 to guarantee the loan. After transferring the money, the person did not receive the loan and had no way of contacting the company.
The company will often claim it is regulated by the Central Bank of Ireland although neither the website nor the company will be regulated. Often an Irish address is provided though this is usually false.
There are warning signs that people can be on the lookout for to identify these fraud websites including the lender asking for some form of advance payment, the website offering fast and easy loans online and then the loan being approved very quickly.
The victim may be pressurized into making an advance payment immediately, often on the basis that the loan offer will be withdrawn if the fee is not paid.
The companies will have a fake address, fake or otherwise incorrect post code for the address on the website and the advertised phone number will not be functioning.
The entities will not seek any evidence to prove the applicant's ability to repay the loan and no guarantor or security will be sought.
Other warning signs include a lack of in-person meetings, the lender will not be regulated by the Central Bank of Ireland and the loan applicant may receive requests to pay a fee in advance by crypto-currency.
Detective Superintendent Michael Cryan says the people targeted are vulnerable and may have been refused loans from established lenders.
"They are hearing the right things from the fraudster," said Det. Supt Cryan.
"The fraudster is there, he is offering them money, he is offering it quick, he is offering it now, he is offering good terms and conditions.
"But he says that obviously they have to show their ability to pay the loan so that is why sometimes they ask for the first month in advance. Or sometimes they claim it's to do with insurance or tax."
Gardaí are advising members of the public to:
- Never pay money in advance to the lender before the loan amount is drawn down
- Never apply for a loan to an entity that is not regulated by the Central Bank of Ireland
- Always check the official Central Bank of Ireland website to see if the company referred to in the website is regulated to provide financial services in Ireland
- Always research the entity offering the loan, their address, their post code and the phone number to check legitimacy
- Use legitimate financial service providers and avail of the services provided by MABS.
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