Dealing with loan scams
A loan scam is when a criminal tricks you into paying upfront for a loan to cover insurance, administration fees or a deposit. This money is taken, but the loan is never provided and the person or company offering the loan disappears. Initial contact about the loan may be through an advert or direct contact by phone, SMS, email or social media.
Alternatively, you may be contacted about loan repayments for a loan you never took out and harassed into making repayments. Criminals may impersonate a legitimate lender that you have used before, convincing you to make payments into a fraudulent account.
As part of this scam, you may have shared personal information such as your banking details and identity information.
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Loan scams - Do this first!
Stop all communication with the criminals – Do not provide any more information or money. Do not respond to any further messages.
Legitimate lenders do not require upfront fees – Be extremely cautious if you are asked to pay an administration fee, insurance fee, registration fee or deposit before receiving a loan. This is one of the most common signs of a loan scam.
Report the incident to SAPS if you have lost money or believe a crime has been committed.
Contact your bank immediately – Explain what has happened. If the payment was made recently, the bank may be able to take steps to help protect your funds or investigate the transaction.
Change your passwords – If you logged into any accounts as part of the scam or shared any passwords, change them immediately. If you reuse that password elsewhere, change it on those accounts as well.
Approaches to dealing with loan scams
If you allowed remote access to your device - If the criminal asked you to install software or access your computer to help with the loan application:
Remove the software as soon as possible.
Run a reputable antivirus scan.
Check your device for any unauthorised changes.
Try to recover your money - Speak to your bank as soon as possible about the payment. Recovery is not always possible, but reporting the transaction quickly gives the best chance of preventing further losses.
If the criminal is harassing or threatening you then get help - If you are experiencing ongoing harassment, threats or intimidation, prioritise your safety. If you believe you are at immediate risk, contact SAPS.
Preserve evidence - Save all communications with the criminals, including:
Screenshots of messages.
Emails.
Transaction records.
Phone numbers.
Usernames.
Website addresses (URLs).
Any reference or case numbers.
If possible, create a timeline showing what happened and when. Preserving evidence may assist your bank or SAPS.
Review what information you shared - Make a list of everything you shared with the scammer, such as:
Passwords.
Banking information.
Identity documents.
South African ID number.
Contact details.
Change passwords immediately where necessary. If financial information was shared, notify your bank without delay.
Contact any impersonated company - If the scammer pretended to represent a legitimate organisation, contact that organisation directly using their official contact details. If you have an account with them, ask them to review your account security and recent activity.
Check your credit profile - Review your credit profile to identify any fraudulent credit applications or accounts opened in your name. South African credit bureaux can help you review your credit information and resolve issues caused by identity fraud.
Protect your identity – If you shared your South African ID number or other identity documents, consider contacting the Southern African Fraud Prevention Service (SAFPS) about protective registration and continue monitoring your credit profile for signs of identity fraud.
Beware recovery scams - After a loan scam, criminals may contact you pretending to be from the police, your bank or another organisation, claiming they can recover your money for a fee.
Do not engage with unsolicited calls, emails or messages offering to recover lost funds. Always verify organisations using their official contact details.
How do I reduce the chance of being caught up in a loan scam?
Be careful of unsolicited messages -Treat unexpected offers of loans, credit cards or other financial products with caution, particularly those received through social media, SMS or messaging apps. Contact lenders directly using their official website or published contact details.
Check if the lender is legitimate - Before applying for a loan:
Check whether the lender or credit provider is registered with the National Credit Regulator (NCR).
Be cautious of anyone offering guaranteed loans regardless of your credit history.
Never pay upfront fees before a loan has been approved.
Protect your identity - If you are concerned your identity information has been compromised, consider protective registration with the Southern African Fraud Prevention Service (SAFPS) where appropriate.
Monitor your credit profile - Regularly review your credit profile for unexpected enquiries, accounts or other signs of identity fraud.
Maintain good online security - Strong passwords, multi-factor authentication where available, keeping your devices updated and remaining cautious of unsolicited communications can significantly reduce the risk of becoming a victim of loan scams.
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