Money-lending scam
from Canada hits isles
The state issued a warning yesterday about a money-lending scam supposedly based in Maine that apparently has hit some Hawaii residents who lost money paying "advance fees."
How to avoid being scammed
>> Do not respond to unsolicited e-mails that ask for personal information.>> Be suspicious of lenders that ask for an advance fee. Legitimate lenders will always conduct a credit check before approving a loan.
>> If a lender seems questionable, check with other financial institutions in the jurisdiction to verify whether the lender in question is legitimate. Usually, lenders are familiar with their competition.
>> Before responding to advertisements for loans, do some research on the lender. Call the local regulatory authority to make sure the lender is licensed with the local bank examiner. In Hawaii, call 586-2820.
>> Consumers who suspect that a lender or business is illegitimate or who are victims of a scam can call the Office of Consumer Protection at 586-2636 to file a complaint.
Regulators in Maine said they have been flooded with calls from consumers, some of them from Hawaii, who have responded to advertisements offering consumers quick and easy loans, according to Hawaii's Department of Commerce and Consumer Affairs.
Direct Finance Co. is placing print advertisements in newspapers across the country listing a Web site, a toll-free phone number and an address for the company's headquarters in South Portland, Maine. Maine officials said those ads were paid for with stolen credit card numbers.
Regulators with the Department of Professional and Financial Regulation in Maine said there is no such company, which is using names similar to legitimate mortgage loan businesses. Maine officials said the office at the address listed by Direct Finance was empty.
According to regulators, Direct Finance is a scam operating out of Canada.
It is unclear whether the company has advertised in Hawaii. But Bill Brennan, spokesman for the state Department of Commerce and Consumer Affairs, said the phone calls from Hawaii to Maine regulators are an indication that the ads may have been circulated locally and that Hawaii residents are responding.
The ads urge consumers to call a toll-free number or to visit the Web site www.DirectFinanceLoans.com and "apply" for a loan. They are notified that they have been "approved" and are directed to send an advance fee of hundreds of dollars to a Canadian address.
The Office of Consumer Protection in Honolulu has not received any complaints, but Executive Director Stephen Levins said consumers should always be suspicious of lenders that guarantee loans in return for an advance fee.
"It's absurd to think that any legitimate lender will guarantee a loan without doing a credit check," Levins said of Direct Finance's guaranteed loan approval. "People don't give away free money."
Should complaints start coming in, Levins said his office will likely coordinate its investigation with those of other jurisdictions where residents also were victimized.
