Reader Warning: Fake Loan Scams

It's a terrible scam and one that has exploded on scene over the last year. Advanced-fee loan fraud takes thousands and sometimes even tens of thousands of dollars from unsuspecting victims hoping to get a loan. The frequency of cases reported to us has recently slowed down a bit, but there are still new victims of this scam emerging. John wrote in with his story:

I recently attempted to secure a loan in hopes of taking care of medical debt. With the promise of a loan, I sent my entire monthly income as a deposit to the company to secure the loan as I was instructed. Now, I'm left with nothing. My wife and I cannot buy groceries, make our mortgage payment, feed our dogs, pay our electric bill, or even purchase toilet paper.

It's a sad day in the United States when a disabled/blind Air Force veteran, 44 years of age, is defrauded of his only income and cannot receive help from any charity. My wife, age 48, recently became unemployed due to the business she worked for closing. That combined with our financial situation has brought on severe depression and illness for her.
Since this has happened, we have learned we are not alone. We have gotten several phone calls from people wanting us to tell them what to do! There are no resources for those of who strive to be good citizens of America.

Yes, we know NOW it is illegal for a company to ask for money upfront but everything looked and sounded legit at the time. We are going to lose our home and car.

I beg you to please help or give our information to anyone who will help.

Our team of experts put together a warning article for consumers when we first heard of this scam last summer. If you are contacted by a lender asking you to wire cash as a "deposit" or "insurance" payment, don't do it.

If you have already been a victim of this scam, please take the time to report it to the FTC, the FBI, PhoneBusters (most incidents seem to involve wiring money to Canada), your local police and your political representatives.

As they say: "Sunlight is the best disinfectant."  One way to stop these criminals is to bring their scam into the light. If everyone is aware of this fraud, the fraudsters will hopefully be put out of business.