Consumer Reports: Scammers target loan seekers amid pandemic financial woes

AM Jennifer Emergency Loans PKG.transfer_frame_1317.jpeg
Posted at 8:53 AM, Dec 30, 2020
and last updated 2020-12-30 09:53:57-05

NASHVILLE, Tenn. (WTVF) — This year has created hardships for many people and when some sought help in the form of a loan, they handed over what money they had and received nothing in return.

Now experts are warning that con artists are using emergency loans to prey on desperate people.

For Jessica Murphy, this year has been hard for many reasons.

"I had cervical cancer and I had to have surgery and for months I wasn't making any Monday," Murphy said.

She fell behind on her bills and her credit score dropped, so she took the advice of her friends and sought out a loan company.

"[I] filled out a form online, just basic information like my name and email and phone number and they called me," she said.

A man named Mike said she'd been approved for a loan, but first, she needed to send money for insurance.

"I tried to explain to this man, like, I have no money. All the money that I have is what I'm sending you so I can get a bigger loan to pay my bills because I'm about to have surgery. I'm a single mother of two," Murphy said.

Mike assured her, as soon as he got the money, she'd receive a $3,000 loan.

"He asked me yet again for a third payment and that's when I was like absolutely not, I was like not only did I already send you all the money that I have to my name, but I know that this is a scam," Murphy said.

In all, she lost $700 and didn't get any of the money back.

"We've definitely seen an uptick of these," said Angie Barnett, president and CEO of the Better Business Bureau serving Greater Maryland.

Barnett said it is illegal for any company to promise a loan and require payment before delivering.

"They do it under the name of COVID. They tell you, 'you are now eligible and all you need to do is pay money for processing fees, money for attorneys,' and people are actually sending their last few dollars to these scams," Barnett said.

These scams are strategically designed to bait people who need money the most.

"You're in your web browser and you put in the word loan," Barnett said. "You are looking for help, that's where they're catching us."

Murphy has finally received her unemployment benefits and now she's paying down her debt, but she wants to warn anyone else in a similar situation.

"I know just how desperate I was feeling at the time and this man, he just seemed so sweet and genuine," Murphy said. "But, I mean, these scammers, that's their life, that's what they do. They come off as real, kind people who are real companies and they're just not."

Not only are they taking your money, they’re also stealing personal information that legitimate lenders might ask such as bank account information or your social security number.

Before choosing any lender, make sure they’re registered with the state, have a good reputation, and take time to thoroughly research their website.