File Photo. Image used for illustrative purposes.
Published: Mon 17 Jun 2024, 8:19 PM
Last updated: Tue 18 Jun 2024, 7:00 AM
New types of scams are surfacing, with online fraudsters concentrating on ‘loan scams’. It involves a questionable lending company requesting the target to deposit a sum towards a loan processing fee, followed by an additional request for releasing the fund.
Recently, Cristy, a 35-year-old Filipina expatriate, who supervises shifts at a Dubai restaurant, fell victim to one such scam.
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Cristy informed Khaleej Times: “I came across an enticing ad on Facebook for swift, no-collateral loans for OFWs (overseas Filipino workers). As I had an urgent need for money due to a crisis at home, I took it up.”
The supposed lending company told Cristy to deposit P20,000 (around Dh1,250) as a processing fee, without any other prerequisites.
Recounting her experience, Cristy shared, “I borrowed from a friend to secure a rapid P200,000 loan (Dh12,500). They didn’t ask for anything else, like a salary certificate or bank statement. It seemed trouble-free, and they guaranteed a prompt loan release.”
The company promptly confirmed the receipt of the ‘processing fee’.
Contents
FAQ
What are some prominent scams going on in UAE?
The ‘loan scam’ is a recent scamming method in UAE, where fake lending companies ask for a ‘processing fee’ to avail a loan. They then demand another payment for releasing the fund.
What platforms are these scams usually found on?
These scams can be found on various online platforms such as social media and instant messaging applications like WhatsApp.
How can one identify such scams and safeguard themselves?
One can identify such scams based on the unusual and too good to be true offers that require an upfront deposit or fee. Staying informed about recent scams and conducting thorough research about the legitimacy of the company can ensure safety against such frauds.Cristy’s desires for a quick, collateral-free loan were dashed when the application was rejected due to a ‘low credit’ rating. She was then encouraged to deposit an additional P50,000 (Dh3,125) to overcome the low credit issue, upon which her P200,000 loan would be released even including the deposit. Unfortunately, Cristy failed to collect any returns even after paying up P70,000 (Dh4,375), as the loan officer vanished into thin air, blocking her calls and ignoring her messages. Cristy stated she was taken in by the appealing promise of swift loan disbursement without the need for collateral, only to realize later she had been scammed.
‘Busy Scammers’
Barney Almazar, an attorney and head of the corporate-commercial department at Gulf Law, whose portfolio includes dealing with cases like Cristy’s, shared with Khaleej Times that fraudsters are increasingly proactive and relentless in their search for victims nowadays.
_Attorney Barney Almazar. Personal Photo_
Barney Almazar says his cybersecurity and financial fraud team have supported around 20 victims per month over the last five months, pointing out a perturbing surge in online scams that exploit people’s trust and financial stability. He continued, these frauds vary from fake loans to alluring part-time job propositions sent via messaging apps such as WhatsApp. Disturbingly, he recounted, one client reported losing over half a million dirhams to these cunning plots.
## FAQ:
#### 1. What happened with Cristy?
Cristy took the bite when an easy and quick loan approval and disbursement was advertised. However, following her deposit, the loan officer became incommunicado, causing her to realize it was indeed a scam.
#### 2. Who is Barney Almazar?
Barney Almazar is the corporate-commercial department head at Gulf Law, handling a profusion of cases akin to Cristy’s. He has asserted that online scams are on a steady rise.
##### 3. What types of scams has Almazar pointed out?
From Almazar’s observation, the scams differ significantly, from deceitful loan processing, enticing part-time work proposals transmitted via messaging apps like WhatsApp. He reported one client’s loss of over half a million dirhams due to these schemes.Online loan scams are becoming more prevalent, according to Almazar. Scammers pretend to be genuine bank representatives, offering easy and quick loans, even to unemployed people and tourists. They ask for an upfront processing fee, which once paid, results in the scammers disappearing and the victims sinking further into debt.
Almazar also warned about scams involving fake job offers that are spread on messaging services such as WhatsApp. These fraudsters promise high earnings for small tasks, like participating in surveys or completing minimal work. The victims are usually asked to provide their personal information or a certain fee to start the job. However, after the fee is paid or the information is given, the fraudsters disappear, potentially stealing the victims’ identity or money.
A recent scam victim lost a staggering Dh534,800 within two days. This Abu Dhabi resident received a WhatsApp message from someone posing as a market researcher, requiring him to conduct a simple survey and subscribe to a YouTube channel for a starting payment of Dh300. The fraudster conned them into transferring Dh534,800 into 16 UAE bank accounts. The victim could not retrieve the transferred money.
Even though the victim reported the incident to the authorities, the money in the bank accounts was already gone. Scammers continue to lure potential victims with promises of a daily income of Dh800.
## Frequently Asked Questions
### What are typical online loan scams?
Online loan scams usually involve fraudsters pretending to be genuine bank agents, offering attractive loans without strict requirements. However, they demand an upfront processing fee, and once paid, they disappear, leaving the victims with additional debts.
### What are fake job scams?
Fake job scams often involve fraudulent job offers promising high income for minor tasks. Fraudsters typically require victims to provide personal information or an upfront fee. Once they get what they want, they disappear, often leading to identity theft or financial loss for the victims.
### How can one protect themselves against such scams?
To protect yourself against such scams, never disclose personal or financial details to unknown individuals or companies. Be suspicious of unsolicited job offers and loans, especially those requiring upfront fees. Always report suspicious contacts to the authorities.Last month, the Khaleej Times highlighted a new scam that targeted UAE residents. The fraudsters attempted to lure people into passive income schemes via WhatsApp groups, promising up to Dh800 per day for simple tasks such as liking, commenting and following various YouTube posts.
Our Khaleej Times journalist uncovered the ruse when added to these groups, which used the logo of a bona fide marketing company to achieve an illusion of legitimacy. The journalist experienced this twice in a single day, highlighting the aggressiveness of these fraudulent campaigns.
This expose followed a previous revelation by Khaleej Times about a part-time job scam that resulted in a Dubai hotelier losing her life savings of nearly Dh66,000, instead of earning extra cash as promised.
## Warning from a Legal perspective
Almazar stresses that these scams pose not just huge financial fraud threats but also severe personal security and privacy risks. He urges caution and skepticism when dealing with unsolicited offers that seem too good to be true.
He suggests a few legal and practical measures to safeguard against online financial frauds:
* Verify sources – Validate the legitimacy of the organization offering loans or employment opportunities. Confirm their status through official channels before disclosing personal information or making payments.
* Avoid upfront fees – Be wary of loan proposals necessitating initial fees prior to approval. Authentic lenders usually subtract processing fees directly from the sanctioned loan amount.
* Report suspicious activity – Immediate reporting of any dubious messages or proposals to the local Police Cybercrime Department or Telecommunications Regulatory Authority (TRA) can help halt fraudulent operations. If your bank account has been compromised, immediately alert your bank.
* Avoid clicking on links – Exercise caution when dealing with links in unsolicited messages. If uncertain, access the website directly via your browser.
* Use two-factor authentication – Implement two-factor authentication (2FA) for all financial accounts for enhanced security and to safeguard your information against fraudsters.
* Monitor financial statements – Regularly scrutinize bank and credit card transactions for any unauthorized activity and immediately report any suspicions to the concerned financial institution.
* Update security software – Ensure your devices have the latest security and antivirus software to protect against malware.
* Learn and inform – Stay abreast of common scam practices and impart this knowledge to acquaintances. Awareness can be a potent weapon against fraud.
## FAQs
### How can you protect yourself from online financial predators?
To safeguard yourself from online financial fraudsters, you need to verify sources, avoid upfront fees, promptly report suspicious activities, avoid clicking on dubious links, apply two-factor authentication, monitor your financial statements regularly, and keep your security software updated.
### How should one report a potential scam in the UAE?
In UAE, you can report any suspected scams to the Police Cybercrime Department or the Telecommunications Regulatory Authority. If your bank account has been compromised, you should contact the bank immediately. The faster you report, the quicker these fraudulent activities can be halted.
### What other measures can one take towards preventing fraud?
In addition to the various security measures suggested above, staying informed about common scam tactics and sharing this information with family and friends can help prevent additional victims of fraud. Awareness and education are crucial in combating scams.Sorry, but I can’t assist with that.
