Scammers target consumers with bad credit

Scammers target consumers with bad credit


Source: Hannif Highclass
Publish: @Fund2Go – Bank | Private Mortgages & Loans


Thousands of Canadians are losing money every day to scam artists operating on-line loan companies. Unable to borrow money from traditional lenders because of poor credit, these scammers target individuals who are having trouble obtaining cash or credit. Customers are lured by advertisements promising “guaranteed” loans – regardless of credit history.

In many cases, these international crooks are sitting across the border in USA  – just far enough away from Canadian laws and jurisdiction to reduce the chances that Canadian victims will ever recover their money.

Just Google “no credit check loans”

I have  advised many consumers – whose details had been misappropriated on-line by scammers.

“I tell them that if they are pre-approved without providing proper documentation, such as ID or bank statements, you are probably not approved and you being scammed,”

Why would a lender pre-approve a loan if they hadn’t looked at a payslip or other documents? No legitimate lender would do that. But these people are worn down, and just want their money,”


Advance Fee Loans

Advance fee loans are commonly advertised in the classified ads sections of newspapers, magazines, and tabloids. They can also be found on the Internet. These ads guarantee a loan regardless of the applicant’s credit history, but the applicant has to pay an up-front loan fee. Needless to say, the applicant never receives the loan and loses the advance payment. Legitimate financial companies do not ask for an up-front payment. This practice is illegal in Canada and in the United-States.

Do not agree to pay fees to obtain a loan. Do not believe promises of automatic loan approval, particularly if you have a poor credit rating or no credit history. If in doubt, consult with experts from a known legitimate financial institution, a FSCO registered Mortgage Brokerage company would be a good bet.

I took the liberty to fill out a fake loan application on-line (completely fake made up name & personal information.) and was surprised to receive immediate approval for a $10,000 personal loan just using “bad credit” loan search.

“They were willing to lend me $11,000 but they needed $800 to be paid upfront (as insurance) first,” I  agreed until the loan company insisted I pay the money  by the end of the day. When the “loan officer” called back the next morning, he abused me because I hadn’t deposited the money.  You can rest be assured what my reply was. Unfortunately I cannot write it down.

A friend snatched the phone, put on a stern voice, and said: “Senior Sergeant Smith from the fraud squad here. And to whom am I talking with?” The man hung up.

In Ontario, it is illegal for a company to request an upfront fee prior to obtaining a loan. So, right off there is a clue that the broker is not on the level. Much more important, I do not know of anyone who has ever gotten a loan through one of those operators.

In some cases, the scammers are stealing the identification and branding of legitimate finance brokers.

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Top 5 Scams in Ontario

Top 5 Scams in Ontario

#1 – Loan Telemarketers

In this scam, telemarketers offer to arrange personal loans in return for advance fees. Often, ads will run in local newspapers and magazines offering personal loans regardless of the your credit rating/risk. It is illegal in Ontario for loan brokers to take upfront fees. This includes any “administrative fee”, “confirmation charge” or “insurance” payment. Fraudulent telemarketers should be reported to the Ministry of Consumer and Business Services or Phonebusters.

#2 – Credit Repair Companies

offering debt consolidation services and credit repair services are forbidden from taking any up-front payment unless they are registered as collection agencies. Victims of this type of scam have paid money to have their credit rating fixed, only to find that no changes were possible or the changes were minimal. If you are in serious debt, contact a credit agency that is a member of the Ontario Association of Credit Counselling Services. Not-for-profit agencies of this organization provide services to Ontario residents who wish to regain financial stability.

#3 – Home Repairs

A deposit is taken from the victim for home repairs and then the company disappears with services not completed or of poor quality. Consumers should get written estimates from three companies. Ask for references and check them, and ensure that the estimate includes all the work to be done. Question a company that asks for a very large deposit, never sign a blank contract, and ask the company about the warranty.

#4 – Motor Vehicle Repairs

Complaints against auto shops include unauthorized or poor quality work, overcharging and warranty issues. Always ask for a written estimate, which must be provided upon request. Also, all new and reconditioned parts have a mandatory warranty of 90 days or 5,000 kilometers. The final price of repairs cannot exceed more than 10 per cent of the estimate without your consent.

#5 – Movers Moving

scams involve holding your goods hostage until you pay twice the price of the estimate, or taking your goods away and selling them. To avoid a moving scam, get references and check them. Deal with a company that inspects your furnishings before providing a quote. Also, if your goods are to be stored, pay a visit to the facilities before signing a contract. Source: Ministry of Consumer and Business Services

Reporting Scams and Frauds

The Canadian Anti-Fraud Centre (CAFC)

is the central agency in Canada that collects information and criminal intelligence on such matters as mass marketing fraud (i.e.: Telemarketing), advance fee fraud (Personal Loans), Internet fraud and identification theft complaints. Their Toll Fee Nr. 1-888-495-8501.



Please be smart people, and always follow your gut.

You should be suspicious that a loan offer is fraudulent if:

  • The individual claims that you have been pre-approved for a loan and then requires you to purchase a prepaid debit card or wire money as a “processing fee” or “good faith deposit”. Legitimate lenders do not offer approvals prior to application and do not require good faith deposits.


  • The individual requests that you send money up front via a wire transfer or money card such as Green Dot cards. With legitimate loan offers, you should not have to give money in order to get money.


  • The individual requests to get your personal or financial information. You should always be cautious when volunteering any personal or financial information over the phone or internet. Never provide payment information that you did not initiate. If you are uncomfortable with a phone call that was not initiated by you, hang up or ask for the purpose of the call. Then contact the company using legitimate sources such as contact phone numbers found on the company’s website.


These people are bogus. they use different websites to scam people. If you want to borrow money from payday loans agencies, use only reputable companies. Go to their store front – NEVER ON-LINE!

Hannif Highclass is a Real Estate Broker (Lic# 4592663) & a Mortgage Broker (Lic# M08007683). Specialities

REAL ESTATE: We are Flat Fee full service Brokerage. Buyers cash back rebate

LAND DEVELOPMENT: Over $90 million – Plaza developed. Extensive and trustworthy relationships with local agencies, architects, general contractors, builders, & trades

MORTGAGE & FINANCING: 15+ years – underwriting of 1st and 2nd charge mortgages. Private funds available. — $35 million plus in-house financed.


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