‘Be very careful’ – Garda warning as fraudsters target people desperate for short term loans with ‘advance fee’ scam

People looking online for loans are being urged by gardaí to exercise extreme caution about who they deal with after a recent increase in the number of people falling victim to so-called ‘advance fee’ scams.

he scam is particularly callous in that it targets people who are desperate for money and cannot get credit through mainstream financial institutions.

While other phone and text scams, such as fake messages from government agencies like Revenue, still persist, the ‘advance fee’ scam is different in that the fraudsters wait for a desperate person to do an online search for credit, and then they take advantage of that person.

“How it works is a person goes online and searches for ‘quick credit’ or ‘fast loans’ in a search engine, and they will find a number of different companies offering their services,” said Detective Superintendent Michael Cryan of the Garda National Economic Crime Bureau (GNECB).

“Some of these sites might be legitimate, but a number of them will be scammers who have cloned or mimicked a legitimate site, and even make it look Irish although the chances are it is controlled from abroad.

“A desperate person fills in their details and then within minutes they get a phone call to discuss ‘the loan’ and they will be told that in order to qualify they will need to pay the first installment up-front as insurance, or to prove that they are legitimate.

“So if you’re looking for a €2,000 loan from them for a short term you will have to pay five or 10pc of it in advance. You pay the money over and you never hear from them again.

“While the amount stolen might appear small on an individual basis, it is often stolen from people who are already at their wits’ end financially, and it all adds up for the scammer.

“If you can take €50 from 1,000 people, that’s €50,000,” Det Supt Cryan explained.

He advised anyone who is dealing with any financial institution to check with the Central Bank website to ensure it is regulated by them.

“Be very careful to check the exact wording of the company name, because many scammers make their sites look almost identical to a company with a legitimate background, but maybe changing words like ‘credit’ in the title to ‘loans’,” he said.

He also warned that at this time of the year many students or their parents fall foul of accommodation scams for flats or apartments near colleges or universities.

He advised that people should only use recognised letting agencies or deal with people who are bona fide and trusted.

“Websites can be cloned. Check the URL to ensure it’s a real website and take note of the privacy and refund policy sections.

“Be very wary of social media advertisements or where a person letting the location will only communicate via messenger or WhatsApp.

“You should push for direct answers and if responses are vague, disengage immediately.

“Watch out for unsolicited contacts or where the contact appears to be based in other jurisdictions, and especially if there is a sense of urgency like a ‘one-time offer’.

“If you have decided to take up the offer, only use trusted money transfer systems. Never transfer money direct, pay cash, or pay into cryptocurrency wallets.

“Be wary if a website is asking you to send money to a random PayPal address, or asks you to wire it by Western Union, pay in iTunes gift cards or only deals in cryptocurrency.

“The majority of the time, those methods are done to avoid scrutiny and ensure that a transaction can’t be reversed.” 

Cryptocurrency itself as a source of investment fraud has also been highlighted by the GNECB.

With news this week that around half a million people now own cryptocurrencies in this country, gardaí fear that the lure of this invisible currency is strong and the risk of getting caught out by scammers is high as a result.

Earlier this year the GNECB said there had been a 120pc increase in investment fraud during the Covid pandemic. 

People searching online for somewhere to invest their savings or pension lump-sums are being lured by the promise of big returns but are often being scammed by fraudsters pretending to be legitimate financial companies.

Most investment fraud cases involve sums of more than €40,000, and the advice again from gardaí is to always check that the company you are dealing with is regulated by the Central Bank here in Ireland.

“If a deal or a return on an investment looks too good to be true then it most likely is,” said Det Supt Cryan.

“If you are looking for a loan, or to invest money, go to someone you can trust and get advice before you trust a website.” 

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