BBB warns to avoid advance-fee loan scams

March 07, 2014

Special note from Better Business Bureau of Acadiana President/CEO Sharane Gott: The Better Business Bureau of Acadiana is celebrating National Consumer Protection Week through March 7. Each day, the BBB will release a special tip on a variety of consumer issues.

Better Business Bureau of Acadiana is alerting consumers and small businesses with credit problems to avoid advance-fee loans, which are often scams.

It is easy to be tempted by ads and websites that guarantee loans or credit cards, regardless of your credit history. Legitimate lenders never "guarantee" or say that you are likely to get a loan or a credit card before you apply, especially if you have bad credit, no credit, or a bankruptcy.

Sure Signs of an Advance-Fee Loan Scam:


·        A lender who isn’t interested in your credit history. A lender may offer loans or credit cards for many purposes — for example, so you can start a business or consolidate your bills. But one who doesn’t care about your credit record should worry you. Ads that say “Bad credit? No problem” or“We don’t care about your past. You deserve a loan” or “Get money fast” or even“No hassle — guaranteed” often indicate a scam. Banks and other legitimate lenders generally evaluate creditworthiness and confirm the information in an application before they grant firm offers of credit to anyone.


·        Fees that aren't disclosed clearly or prominently. Scam lenders may say you’ve been approved for a loan, then call or email demanding a fee before you can get the money. Any up-front fee that the lender wants to collect before granting the loan is a cue to walk away.


·        A loan that is offered by phone. It is illegal for companies doing business by phone in the U.S. to promise you a loan or credit card and ask you to pay for it before they deliver.


·        A lender who uses a copy-cat name. Crooks give their companies names that sound like well-known or respected organizations and create websites that look professional. Some scam artists have pretended to be the Better Business Bureau, a major bank, or another reputable organization;some even produce forged paperwork or pay people to pretend to be references.Always get a company’s phone number and physical address from a phone book or directory assistance and call to check they are who they say they are.


·        A lender who asks you to wire money or pay an individual. Don’t make a payment for a loan or credit card directly to an individual. In addition, don’t use a wire transfer service or send money orders for a loan.You have little recourse if there’s a problem with a wire transaction, and legitimate lenders don’t pressure their customers to wire money.


BBB of Acadiana works for a trustworthy marketplace by maintaining standards for truthful advertising, investigating and exposing fraud against consumers and businesses. Find information at or call (337) 981-3497 around the clock for information on businesses throughout North America.


The BBB of Acadiana services the parishes of Acadia, Evangeline, Iberia, Lafayette, St.Martin, St. Landry and Vermilion.