People typically become victims of consumer finance scams when the mainstream channels for borrowing money, establishing credit or finding a job haven’t been successful. This is when people are at their most vulnerable.
When people are desperate or in great need, they are willing to pay a small amount of money to get any job that pays or to secure financing. They may be willing to pay an unreasonable fee for the guarantee of a loan or credit because their local bank or credit lender has turned them away. They may be willing to stay at home and stuff envelopes or assemble crafts to earn money because local jobs aren’t available. Unfortunately, their hard work and surrendering of money won’t be rewarded.
Scam artists take advantage of people’s desperation. They advertise in newspapers, through postal mail, at websites, on road signs and through spam emails. Different kinds of consumer finance scams include advance fee scams, credit repair scams, education scams, overpayment scams, pyramid schemes and work-at-home scams.
Typically, consumer finance scams require the victim to pay an up-front fee for the advertised service. The up-front fee can be disguised as a processing fee, a registration fee, a financing fee or any other creative title the scam artist thinks will convince the victim to surrender their money. The required up-front fee should be your cue to avoid the job, loan or credit offer. There is no such thing as a guarantee of profit or income or a get rich quick method that actually works.
Legitimate companies don’t charge prospective employees for submitting their resume. Legitimate loan companies don’t charge a fee to submit an application for a loan. Credit card companies don’t charge for submitting an application for credit. Any up-front fee is an indication of a possible scam.
Consumer finance scams will not get you the job, loan or credit that you desperately need. They will only separate you from your money that you can’t afford to lose and provide you with nothing in return.
You can file a complaint with the Federal Trade Commission in the USA or with the RCMP in Canada. Remember, “if it sounds too good to be true, it probably is." For a review about how to recognize potential scams, read this article.