“Advance-Fee Loans” Scammers Target Entrepreneurs

Date: May 27, 2014

FTC Complaints Increase By 10,000 In 2013

With sources of capital still in short supply in
the wake of the financial crisis, small businesses are exploring
non-traditional means to secure funds. However, that has left some open to
complex scam artists. One such scam that has been drawing attention in recent
weeks is the “advance fee-loan.” The basis of the scam is for a self-described
loan broker to demand an upfront payment for a loan that never materializes. In
2013, there were more than 53,000 complaints about such loans filed with the
Federal Trade Commission, up from 43,000 the previous year.

Further Reading:

In addition to a
significant piece in the Wall
Street Journal,
the issue has also drawn the attention of local news outlets, such as WIBW-TV .

Related: Don’t Be a Victim of “Yellow Pages” Scams

This news article is intended to keep small business owners apprised of current events that may affect them. It does not necessarily reflect NFIB’s policy position on such issues.

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