Fraudulent Loan Advertisements
Fraudulent advertisements for loans are being placed in newspapers using official financial institution logos to induce consumers to wire advance payments.
This practice is believed to affect as many as 50 financial institutions. Here's how the scam works:
The scam, which is believed to originate in Canada, begins with a fraudulent advertisement for mortgage, small business, debt consolidation or other loans placed in smaller-market or community newspapers. The advertisements include representations of official financial institution logos and are paid for with stolen credit cards. Contact with the newspaper is through prepaid cell phones obtained in Canada. The phone numbers in the advertisements are for the prepaid cell phones. The consumer (victim) provides application information, including his or her Social Security number, over the phone to a 'third-party consultant' and is told that a loan is 'granted.' A loan package is faxed to the victim and includes a request for bank account information. Many customers have also been asked to fax copies of their driver's licenses and Social Security cards.
The victim is asked to make an advance payment or deposit before the loan is advanced by wire transfer through Western Union. The deposit is wired to the 'third-party consultant.' Basically, the consumer in this scheme does not obtain a loan; rather, this is a method to obtain advance payments from the victim.
There are reports that a number of unsuspecting consumers have applied for loans and wired advance loan payments.
We encourage members to view with extreme caution any proposed transaction requiring you to wire funds outside of the banking system. Additionally, there is extreme potential for identity theft in this scheme. Be alert, be careful.