DON’T GET TRAPPED BY LOAN SCAMMERS

Technology has evolved after COVID-19 takes place across the world. The same goes for scammers in Malaysia; their syndicate has advanced quite well as they managed to deceive more victims during this pandemic. They disguise as bank officers using fake licenses and scam their victims through email, phone calls, social media, and SMS.

The police have reported 4,423 cases involving loan scams during the current pandemic, with a total loss of RM48.72 million. It was 8% higher than the previous year, which was 4,063 cases with total losses of RM39.33 million.

Here is the scenario (example):

Aaren is a restaurant owner that has operated his business for five years. Recently, his business performance is not doing well. So, he decided to apply for a quick loan. Unfortunately, Aaren found an online advertisement from a lender known as Bank A that provides loans. He managed to get in touch with a scammer; in disguise as the "bank officer" from Bank A. Without checking Aaren's past credit history, Bank A has approved his loan amounting to RM50,000 within several days of applying.

Before Aaren proceed to receive the loan, the bank officer (scammer) informed him that he needs to pay a processing fee of RM30,000 as part of the loan terms. Without hesitating, Aaren paid the amount requested by Bank A within several days. However, he has not received any feedback from Bank A. He tried to contact the bank officer, but there were no answers. Now, he realizes that he might have lost all his money given to the scammers.

How to avoid getting scam:

It is a common scenario, especially in times like today when you can find many phishing cases. Nonetheless, there are few ways to spot these scams:

If you ever apply for a loan before, it is common that the lender checks your credit history to make sure that you are eligible to take the loan. However, if the lender does not even bother to ask for your credit history, there must be something wrong.

Scammers do not care about your credit history. They are even more than happy if your credit history is bad. Why? Because they are not even a lender. They take money from you.

Usually, online lenders will try to push you to give your personal information or pay installments before getting any paperwork. They will try to convince you that this is only a one-time offer, where if you apply now, you will get interest-free installments from them.

Make sure to go through all the documents before you apply, especially when it involves money.

If your loan lender asked you to pay processing fees or insurance fees before approving your loan, then it is a scam. In most cases, legitimate lenders will not ask the borrowers to pay anything before giving the loan.

Most of the time, A legitimate personal loan lender does have a website that looks legit. If they are not, then the chances are you might have stumbled on a fraud company. However, you can check their website through scam adviser, SCAM.my, and many more to ensure authentication.

If the lender asks for your personal information, do not simply give them. Banks or financial institutions would never ask for personal banking information such as Transaction Authorisation Code (TAC) or Personal Identification Number (PIN) or username and password.

If you are applying for a loan, make sure to take note of the advice given. Do not get fooled easily by these online scams. For more information regarding loan scams, you can go to SEMAK MULE provided by Malaysian Police to identify potentials scammer.