I responded to an advertisement for guaranteed loans and was told that my loan application will be approved, as long as I make a fee payment in advance. Is this sort of transaction normal?
Classified advertisements for loans do not guarantee that the company is legitimate. It is important to establish that the loan is being offered by a reputable loan broker. Some companies claim they can guarantee you a loan even if you have a bad credit history or no credit rating at all. They usually request an up-front fee. If you send your money to these companies, it is unlikely that you will get your promised loan and your advance fee payment will be at risk. Persons with poor credit ratings are usually the key targets and once the ‘loan processors' receive your money, the fraudsters usually disappear. Applications for loans should be processed through legitimate financial institutions.
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I've received a letter from someone in Africa wanting to transfer money into my bank account, all I have to do is pay some wire transfer fees and I will get a percentage. Should I pay these fees?
Watch out for the Nigerian Business letter scam! For years now, businesses, learning institutions, and government departments have been receiving e-mails from senders posing as Nigerian government or business officials offering to share large sums of money. The Royal Canadian Mounted Police estimates Canadians have lost about $30 million to the scam over the last ten years and reports that about 10,000-15,000 letters pushing variations of this fraud from Nigeria have circulated in Canada. Please forward Nigerian/African letters to wafl@phonebusters.com. The Phonebusters National Call Centre ('PNCC') is a joint partnership involving the Ontario Provincial Police (OPP) and the Royal Canadian Mounted Police (RCMP). The PNCC is very interested in receiving copies of Nigerian letter scheme, particularly those involving Canadian mailing addresses or telephone numbers. This valuable intelligence information is used to assist in targeting fraudsters.
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Advance Fee Fraud (“Nigerian” letters, emails)
Situation: you receive an email describing an allegedly legal business proposal. The essence of the proposal involves helping the sender move a large sum of money to a bank account in your country. Although Nigeria is often said to be the source of these funds, recent “scam” letters have named many other countries. The sender offers you a share in the funds in exchange for your help.
This is one of the oldest scams around. If you agree to help, you will eventually be asked to advance your own funds to the scammers to “defray expense”, “pay local fees”, or some other pretext which will involve sending the scammer money. If you send them money, you will be marked as gullible and over time will be asked to send more and more money.
Situation: you receive an email advising you have won a prize in a lottery. Although you have no recollection of participating, the perpetrator assures you that the prize will be yours as soon as you call to register your claim.
If you respond, you will either be asked for your personal banking information, or asked to send money in order to be eligible for the “win”. You will never receive the “winnings” but will be asked for more and more funds to pay various “expenses”.
Situation: you own a number of low-value shares. You get an email from a firm offering to buy the shares at a high price. To accept the offer you are asked to pay them a “vendor’s fee” or similar fee.
If you respond, you will be asked to endorse the security certificates in blank, provide your personal banking information, or provide funds to pay for the “vendor’s fee”. You will never receive the proceeds of any “sale”, and will also lose any value the securities have. You may also be asked for more and more funds to pay various “expenses” to get the shares back
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Fake Loans
Situation: you see a newspaper advertisement or you receive an email from what looks like a genuine financial institution offering to lend you money even if you have no credit rating. These scams frequently involve the placement of classified advertisements in local newspapers in the United States that offer personal loans, small business loans, mortgages and automobile loans at very low interest rates. Individuals are encouraged to contact a toll-free number in Toronto. When this number is called, the individual is offered a low interest loan on the condition that an advance deposit or processing fee is sent via wire transfer.
If you respond, you will either be asked for your personal banking information, or asked to send money (“processing fee” “administration fee”, etc.) in order to be eligible for the “loan”. You will never receive the proceeds of the “loan” but will be asked for more and more funds to pay various “expenses”.
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Identify Theft
Situation: you receive an email that looks like it came from a financial institution. It might be the institution you use for banking services; or perhaps one you’ve never heard of. The email gives any one of several reasons why it is important for you to log on to your account, using a supplied hyperlink that may or may not look authentic.
These kinds of emails are often referred to as “phishing”. In addition to impersonating financial institutions, other Internet merchants such as Ebay or Paypal are often victims as well. The embedded link is to a fake web site, which asks you to log into your account. If you do so, nothing apparently happens – but the thieves now know your account and PIN number at your financial institution. They can raid your account and extract as much cash as possible before the bank detects the activity and freezes your account.
Variations in “phishing” emails include emails that look like greetings card notices or notices issued by legitimate regulators or law enforcement authorities.
You should use extreme caution in dealing with anyone claiming association with a financial entity, even if it is well known and especially if the email is from an institution with which you have no relationship. Legitimate financial institutions NEVER send out emails requesting personal banking information. Scam artists frequently use the names of reputable organizations to give credence to their scam.
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Fake Job Offers
Situation: you receive an email from a company offering you a job. The duties include a requirement that you process various payments through your bank account from their “suppliers”.
A relatively recent development, these emails are from money launderers looking for “mules” or “smurfs” to process payments (usually the proceeds of crime”) made through money remitters.
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What should you do if you get one of these emails?
- DO NOT CLICK on any embedded link in the email, as it is possible that a fraudulent web site could attack your computer.
- Do not respond to the sender.
- Under no circumstances should you send any money or other valuables such as shares or securities certificates. Sometimes, fraudsters will play upon the natural desire of people to help someone in distress by claiming funds are needed for urgent medical reasons, or a need to “act now while this opportunity lasts”.
- If you are in any doubt as to the bona fides of a financial institution, ask for information on where the institution is regulated and who regulates it. In Canada, regulated financial institutions are supervised either by OSFI, or by a provincial or territorial authority or agency. A list of financial institutions regulated by OSFI can be viewed at http://www.osfi-bsif.gc.ca/osfi/index_e.aspx?DetailID=568.
- Report the email to law enforcement, and then delete it.
Canadian Residents:
- Send the email to Phonebusters. See www.phonebusters.com for more information. You can also contact the Royal Canadian Mounted Police, your provincial police service, or your city or local police.
- You can also contact Reporting Economic Crime On-Line (RECOL) at www.recol,ca. This service is a partnership between International and Canadian law enforcement agencies. Complaints will be directed to the most appropriate investigative agency.
US Residents:
Residents of other countries:
- Contact your local law enforcement (police) authority.
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