These Scammers Claim To Be From “Financial Crimes Division”

September 11, 2008

The Better Business Bureau has recently heard from consumers who have received calls from someone claiming to represent “the Financial Crimes Division.”  The scammer claims that the consumer owes on a payday loan taken out years ago but not paid back. These scammers appear to operate using a list of people who have used payday loans at some point in the past.

People called by these scammers are confident that they repaid their payday loans, but the scammers are using scare tactics that have prompted some consumers to make additional payments.  In one case, a consumer told the BBB he used a prepaid Visa card to make four payments totaling $2000, only to be told that he must pay an additional $1,600 "within the next 20 minutes."

The scammers have in some cases contacted consumers at work, and in these cases the consumer is still working at the same place of employment that the consumer had when the loan was taken out.

Based on news reports that have come to the BBB’s attention, it appears most people targeted by this scam may have taken out payday loans through websites. The West Virginia Attorney General’s office believes the scammers may be operating using personal information stolen from one or more Internet payday lending services.

Scare tactics used by the scammers have included:

  • If we must go to court to collect this debt, it will cost you $25,000 and we will go to court unless you pay us right now.
  • Consumers have been told that police will arrest them at their place of work or at home unless they pay within the next 20 minutes, or right now.
  • The scammers use phrases that sound like legal terms, such as saying they have “affidavits,” as another intimidation technique.

The consumer has sometimes been asked, “We have your Social Security number, will you verify it for us?” It is unclear whether or not the scammer actually has the victim’s Social Security number or is only trying to trick the consumer into providing that number.

Threatening a debtor with arrest as a debt collection practice is illegal and violates the federal Fair Debt Collection Practices Act.

If you are contacted by someone claiming to be from “the Financial Crimes Division” or any other official-sounding entity, don’t be intimidated into making payments that you don’t believe you owe. Instead, demand that the caller provide proof that the debt is owed, and call your Better Business Bureau (in the Louisville area, call 583-6546; in other parts of Kentucky or Southern Indiana, call 800-388-2222) to report the call or to check out whether any suspicious call is a scam attempt.