Small business owners and start-ups are increasing by the minute.
And so are the new techniques scammers are into to reel the newbie to the trap.
Loan scammers target small businesses just as they do individuals. Fraudulent
operators might appear legitimate at first glance, presenting slick-looking ads
and websites featuring made-up testimonials from happy customers. Axis Capital Group Business
Funding in Jakarta reminds us to continuously be cautious of who
we deal with and be conscious of the warning signs.
1. Ask the loan company whether any advance payment is required.
If the answer is yes, it is a red flag. Legitimate loan companies disclose fees
up front and deduct them from the loan amount you receive, rather than
demanding money up front. Don’t be fooled by promises that an upfront payment
will guarantee you will get a loan.
2. Always consult legal advice for review of your loan agreement.
If a loan contract is bogus, a legal professional can detect a scam you might
miss. Avoid being rushed. High-pressure tactics and efforts to hurry you into
signing a contract are red flags suggesting you are dealing with a loan
scammer. Legitimate lenders will not object to a review by your legal counsel
and may even suggest that you do so.
3. Perform a search of the Better Business Bureau database.
Legitimate business funding should be a member of BBB. When you are not located
in the US, in Jakarta, Indonesia, for instance, you can check your local
government database available in every locality of the city.
4. Contact your state's attorney general, financial registration
agency or banking oversight agency. Loan companies and loan brokers are
required by law to register with state agencies in order to do business within
a state.
Avoid providing your business or personal bank account information
or your Social Security number in advance. You might find your business being
billed for fees and you risk having your identity stolen.
Beware of loan company websites that mimic well-known lenders and
financial institutions. Do not assume a copycat name implies any association.
This is a common tactic used by loan scammers. Finally, don’t assume a
professional-appearing website indicates legitimacy. Sophisticated scammers
often employ slick websites complete with blogs, informational articles and
other features to create the appearance of legitimacy. Always remember that
these people have become far more advanced nowadays so you have to be a step
ahead of them.
