Protect yourself from loan scams
When we hear stories about people who have been scammed, we tend to think that it would never happen to us. However, scammers are true professionals in social engineering techniques.
Here's our guide to protecting you from personal credit scams.
How do personal loan scams work?
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No matter what the background, age, profession or education, anyone is susceptible to falling into the trap of a fraudster in a vulnerable situation (urgent need for money or a job, for example).
The purpose of these criminals is either to get money out of you or to steal access to an account in your name that will be used for illegal activities, such as receiving money from victims of internet fraud, money laundering, drug trafficking or financing terrorism, among a long etcetera.
Once your account is taken over, you become a victim of identity theft and a mule account holder, as this kind of fraud is known.
Vivid and SolarisBank monitor transactions to try to detect these cases, but that doesn't mean you are not susceptible to this type of scam. No matter how many verification and authentication measures are in place, if you don't keep your account access and data safe from third parties, you may be unwittingly collaborating with criminals.
How to identify a fraudulent credit offer?
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There are a number of common patterns that recur in these sorts of dishonest proposals. Be wary of any of these red flags.
Too good to be true
An offer of a loan of a large amount of money at very low interest rates, when other institutions have rejected your application, should give you cause for suspicion.
There are entities that offer loans to people in disadvantageous conditions or who do not have access to these products in traditional banks (e.g. they are on lists of defaulters), but in general, if the conditions are too advantageous, it is probably not legit.
Informal communication
The platform on which you find that wonderful credit that will fix your life gives you many clues as to the legitimacy of the offer.
If you find it on a website that doesn’t contain legal notices or the European Standardised Information of the credit, it may be a scam. Look for the padlock in the browser or https:/ in the web address indicating that the connection is secure.
Social networks such as Facebook and internet forums aren’t used by recognised institutions to negotiate with their clients. In the same way, if a moneylender writes to you through WhatsApp, you have reason to believe that this is not legitimate.
Appropriate language is also important. Spelling mistakes, grammatical errors or expressions that a native speaker would not use in a serious context are common in cases where scammers contact you from another country and use a translator to communicate.
Foreign entity
These fake lenders usually present themselves as a foreign-based entity, which makes it difficult for you to verify the trustworthiness of the company. In addition, if you need to take legal action against fraudsters, it will be much more costly to pursue them and apply your country's laws.
The reality is that it is unusual for a lender that is not based in your country to offer you credit. In case you don’t pay, it would be much more difficult for them to recover the money, so they would avoid taking that risk.
If you are asked to open a new account in a specific foreign bank to receive a loan, be sceptical and contact the bank first.
Not too many questions
No legal entity would lend you money without first checking that you are sufficiently solvent to pay back. Normally you have to answer a long questionnaire in which you are asked if you have a job, if your contract is temporary or permanent, what your income is, if you have a family, or if you own valuable possessions that you can put up as collateral. The amount they offer is in line with your profile and the purpose for which you want to use the money. So if they don't ask you any of these questions, it's another red flag.
Confidential data required
It may sound obvious, but the password to access your account, as well as the PIN of your card, and the codes you receive by SMS to authenticate yourself should never be shared with anyone, only secure digital platforms. Not even customer care agents in an authenticated chat will ask you for this information.
Fraudsters can also ask you to send them photographs of your ID card or passport without showing any respect for data protection laws.
Your card, since it gives access to funds in your personal account, should only be used by you. No one needs your card to transfer you a credit.
And of course, read the contract carefully. It should clearly spell out the conditions: the amount borrowed, the interest rate, the repayment period, the monthly instalments and the fees.
What to do if you think you may have been a victim of a credit scam or identity theft?
If you believe you may have been the victim of a scam, please report it as soon as possible to the police or the appropriate authorities in your country, and inform our customer care team if the fraud is related to your Vivid account. We will evaluate your case so that appropriate action can be taken.
Getting your money stolen is not the only danger. Having an account opened in your name that is being used for criminal activity can have serious consequences for you, starting with not being allowed to open bank accounts or borrow money in the future.
Be wary of cheap money and contact us if you have any concerns!