Carmel on the Case: Loser Loan

WSVN -- Money, we all need it, and most of us never seem to have all that we need, and in this new year, between massive frauds like the alleged Madoff Ponzi scheme, losses on Wall Street and jobs being slashed nationwide, more people than ever will need help making ends meet.

It's the kind of environment in which fraudsters thrive.

Nichole Brown: "And he said my money would be in my account within 24 hours and it wasn't."

Nichole Brown trusted an out-of-state loan company she found on-line. She borrowed money to pay upfront fees that she thought would guarantee a $5,000 loan, but she never got the money and can't reach the company.

Nichole Brown: "Who's ever done this, I really don't know how they can go home and sleep at night because people work so hard for their money."

Cindy Guerra: "Absolutely we're seeing an increase in these kinds of scams."

Deputy Attorney General Cindy Guerra says advance fee loans, loans that require applicants to pay money upfront in the hopes of getting a loan, are for the most part too good to be true.

Cindy Guerra: "They're advertising all over the place. They're advertising in newspapers, Internet, faxes. Basically, they're preying on people that can't get loans from legitimate lending companies."

Some tip offs to a rip off: If someone guarantees you a loan, legitimate companies won't qualify a person without checking their background first. If the loan company wants payment right away to lock in a loan, hard sell tactics are a red flag.

If the money is being sent out of state or out of the country, in the event you get taken, chances of ever getting your money back are slim.

Cindy Guerra: "When people give them money upfront, sometimes they will either leave, skip town, never be heard from again, or sometimes they will stall and say we need a little more money, your credit's not good enough, so unfortunately some people are sending more money."

And that's just what happened to Nichole. She sent two payments of $900 and a third for $780. Now, when she calls the company, all she gets is a message.

The money came from her sister. On top of the bills she had before, Nichole is now paying that money back at the rate of $500 dollars every two weeks.

Nichole Brown: "I feel really bad because my sister's not well. She's on dialysis like three times a week, and I felt really bad.

Carmel Cafiero: "In Florida, most advance fee loans are illegal, although there are some exceptions. The best bet, check with the State Department of Financial Regulation and the Attorney General's Office before you give anybody any money in order to get money."

FOR MORE INFORMATION:

Florida Office of Financial Regulation
http://www.flofr.com

Florida Attorney General
http://myfloridalegal.com

IF YOU HAVE A STORY FOR CARMEL TO INVESTIGATE:

Miami-Dade: 305-627-CLUE
Broward: 954-921-CLUE
E-mail: clue@wsvn.com