Scammers Claim Federal Reserve Program Offers Personal Loans

[Nov 17, 2008.]

When people are facing tough economic times there's always the potential for fraudsters to take advantage of them. According to the Federal Reserve, scammers are targeting people who need personal loans to try and gain access to their checking accounts.

The way the fraud works is consumers are contacted and told that they can borrow personal loans through a Federal Reserve lending program that doesn't actually exist. The scammer claims that people can work with a broker to receive secured personal loans. Then individuals are told to deposit a large amount of money into a bank account as a security deposit for the loan.

If you receive a solicitation of this sort do not answer it. The Federal Reserve is not involved with this program and does not directly sponsor consumer lending programs.

If you are interested in obtaining a secured personal loan find a few reputable lenders and compare the rates being offered. Ask friends and family for referrals to people they have used in the past. You can also apply for a personal loan at the bank where you have a checking or savings account.

If you decide to apply for an online personal loan make sure you know who you're dealing with. Even though your business is being conducted online, you should look for good customer service, low fees, and competitive interest rates when applying for a personal loan.

If any lender offers you a deal that sounds too good to be true or is reluctant to answer all your questions, move on. It's better to be safe than sorry down the road when a scammer has made off with your hard-earned money.

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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