Dear Consumer Ed:
I applied for a loan online. I then received a call from business reps from an out-of-state bank telling me that my loan had been approved but that I had to pay a $120 processing fee via Green Dot MoneyPak card. I got the card and gave the number to the business rep, who then asked for $300 for another processing fee. I bought another card and gave them the number. They then asked me to pay another fee, and I realized I was being scammed. Is there any way I can get my money back?
Consumer Ed says:
It is a violation of Georgia’s Fair Business Practices Act for someone engaged in telemarketing to employ a scheme to defraud another person or to commit theft. If the bank violated the telemarketing laws when they called you about the loan, you may want to consult a lawyer to learn about potential legal claims against the company. You should also report your situation to the Attorney General’s Office and the Department of Banking & Finance in the State in which the bank is headquartered. They may be able to take action if the bank engaged in illegal activities.
However, it is important to realize that the representative who called you may not have actually worked for the bank, and that, unfortunately, you may have been the victim of a scam. In that case, you are very unlikely to recover your lost money since the representative who called you will not be easily traceable. Regardless of whether or not this was a scam, you should also report your situation to the following government agencies in order to attempt to recover your money and to spread the word about the possibility of a scam:
While this will not assist you in retrieving your money in this instance, you should take the following steps in the future when attempting to obtain a loan:
- Don’t pay up front. Legitimate offers of credit generally do not require an up-front fee. Any fees are taken from the amount borrowed after the loan is approved.
- Don’t fall for promises that you’ll get a loan regardless of your credit record. If you have poor credit or haven’t established a good credit record yet, it’s unlikely that a reputable company will lend you money.
- Do business with licensed companies. Ask Georgia’s Department of Banking and Financing (http://dbf.georgia.gov/general-information) if the lender operating in Georgia has complied with the licensing requirements. If it has not, then you should not do business with that company.
- If you can’t get a loan yourself, get a co-signer. Having a co-signer may allow you to obtain a loan from a reputable lender when you would ordinarily not be able to. A co-signer, usually a friend or relative, is someone willing to apply with you for a loan. You and the co-signer would both be equally responsible for the loan payments.
- Get all the costs and other details before you decide. Shop around for the best loan rates and fees. Research several lenders, and look for consumers’ reviews of the different lenders.
- Have proof of what you were promised. Make sure to get the loan agreement in writing or in an electronic form that you can use to document the deal. You want the deal in writing so you know the precise terms of the agreement and so the lender cannot change the terms after you enter into the loan agreement.
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