People with bad credit fooled by a bogus loan scam.
My credit was not the best.
Few people these days have great credit. But it’s not just annoying – some people fall victim to scammers because they have bad credit that makes them desperate enough to fall for an offer that is too good to be true.
How the scam works is that a person receives an email announcing a secured loan. The email displays a logo and contact details for what appears to be a legitimate business. Before making the offer, you research the business online to determine if it is trustworthy. You find that the business name and contact details in the body of the email match those of a legitimate business, so you proceed with the loan.
“It sounded too good to be true and it was,” said a Burnaby resident who received one of the emails. “I really needed someone to believe in me and it cost me dearly. I got ripped off because my credit sucks – basically. “
According to the Better Business Bureau, once you accept the loan, they take your personal banking information and deposit the loan into your account via a check. Then they require you to purchase insurance for the loan before the check is officially cleared.
These scammers know that consumers are increasingly aware of phishing attempts, so they are using a business identity that can easily be verified online as legitimate. This allows them to build the victim’s confidence and ultimately gain access to their bank accounts.
How to avoid bogus loan offers:
- Avoid unsolicited loan offers. Scammers use quick money offers to lure you in, don’t fall for the trap. Whether they’re contacting you by phone, email, or text, or sending you loan offers by mail, approach all unsolicited offers of money with caution.
- Expect a credit check. These scams often prey on people who may not easily qualify for a loan. No legitimate lender will give you a loan without performing a credit check.
- Make sure that the business contact information matches the information for the sender of the email. Brand IDs can easily be copied and included in the body of an email, so the most important information for a consumer to verify is the sender’s email address. The domain of the email address is usually the domain of the official website and should be free from random letters or numbers.
- Research loan providers before accepting an offer. When dealing with an unknown company, don’t just verify that they are legitimate by searching for their name online, as you might be missing out on surprising information. Check out ratings and reviews to see what others are saying, search for a BBB business profile, and research the business with Consumer Protection BC if you are considering a payday loan.