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Payday loan scam involves fake FBI officials

[Dec 3, 2010.]


People with payday loans are being targeted by scam artists posing as Federal Bureau of Investigation (FBI) agents. The scam occurs when a caller tells the victim that he or she is delinquent on a payday loan and demands repayment--to the caller. How do you know whether you are being targeted for fraud?

Impersonating federal officials

The callers in the payday loan scam claim to be from the FBI or to represent other federal agencies or law firms, according to the Internet Crime Complaint Center (IC3). They also say that they are collecting on loans for companies like United Cash Advance, U.S. Cash Advance, U.S. Cash Net and other Internet check cashing services.

Unfortunately, the scammers seem to have personal information about their intended victims, such as social security numbers, birth dates and bank account numbers. It is unclear how the scammers got the information, but in some cases victims said they had previously applied for loans or credit cards online.

Harassing victims to pay loans

It's bad enough when legitimate bill collectors harass you day and night. But having to deal with harassment from fraudsters is especially galling. Victims of the payday loan collection scam were called repeatedly at home and at work. Some people also reported that their friends, relatives or employers were harassed. Scammers threatened to arrest or even physically harm victims if they didn't pay up. Some victims were told to fax a statement saying that they agreed to use a prepaid debit card to pay a certain amount of money by a specific date.

Know your rights

Keep in mind that under the law, debt collectors cannot threaten you verbally or physically. The Fair Debt Collection Practices Act also prohibits debt collectors from lying about who they are; they cannot say they are government officials or attorneys. They also cannot threaten you with being arrested if you don't pay a debt.

Signs of fraud

If you believe that you are being targeted by a scam involving a personal loan, contact your local law enforcement agency, especially if you have been threatened with bodily harm. Also let your bank or credit card companies know that fraudsters have gotten access to your personal information. Ask the three major credit reporting agencies (TransUnion, Equifax and Experian) to put a fraud alert on your file.


About Author:

Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.

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