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Hundreds fall victim to loan scam

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In response to the SMS, she emailed her details and the amount she wanted to borrow. She received an SMS confirming receipt of the email and an application form was emailed directly to her.

“It was very convincing. It had a proper letterhead with director names, registration numbers and even the FSB [Financial Services Board] registration number,” says Patricia, who adds that she only became suspicious when the company asked for her to pay an amount of R2 425 for “attorney fees” to secure the R20 000 loan.

“I work in the financial industry and I had a funny feeling about paying the upfront fee because I hadn’t heard of that before, but then it made sense that it was for attorney fees,” says Patricia, who adds that in one of the emails the company explained that they did not do ordinary bank loans but raised money from investors.

Patricia thought the administration fees could relate to the work done to find investors to fund loans.

Wonga.com’s high profile and extensive advertising made Patricia feel confident that the loan was genuine.

Although a voice at the back of her mind was raising concerns, she paid the money into an Absa account and was told she would have the loan within 24 hours. Two days passed and she received another email, saying they required an additional R1 500.

“When I saw this, I phoned the number on the application form immediately and spoke to someone called Roberts Scott and told him it was illegal to charge an additional fee. He said it was a requirement, but asked me to put my concern in writing.”

Despite emailing her complaint, all Patricia got in response were further emails, urgently asking for the R1 500.

“I became really suspicious when I realised they were using a different bank account for the second payment,” says Patricia, who again phoned “Scott” and told him she wanted to cancel the application and have her money refunded.

“He said I would be reimbursed, but that was the last time I heard from them.”

At this stage, Patricia still believed she was dealing with Wonga.com and lodged a complaint on website Hellopeter.com. Two hours later, Urquhart contacted her directly and told her about the scam. Fraudsters posing as Wonga.com were conning people into paying for nonexistent loans. One victim paid up to R24 000 to the syndicate in the belief they were applying for a R2 million loan.

The scam has been going on for several years, but Urquhart says there has been a strong resurgence in recent months and a far broader base of individuals have been targeted – Wonga is receiving about 300 calls a week from people who have received the SMS. Wonga is aware of at least 200 victims, but that figure could be much higher because these are only the reported cases.

This suggests the syndicate has obtained a database of cellphone numbers, allowing it to be far more prolific.

Patricia says that since falling victim to the Wonga.com SMS scam, she has received multiple offers for loans from various companies – suggesting the group may be operating several loan scams.

“The syndicate has certainly become more sophisticated, using dormant bank accounts within banking institutions. The swiftness with which they are opening and closing these bank accounts shows the level of cunning and sophistication,” says Urquhart.

The modus operandi appears to differ depending on the financial sophistication of the potential victim. In the case of domestic worker Thomas, when he called the number on an SMS offering a “Wonga loan”, he spoke to a woman called Cindy. He provided his ID number and banking details and was offered a R15 000 loan if he made a deposit of R1 500.

In this case, he was asked to do a money transfer through Shoprite Checkers. The money was withdrawn at a Shoprite in Yeoville, Johannesburg.

He called someone called Cindy when he did not receive the loan and was asked to pay a further R1 350. Because he only had R600 left to his name, he transferred this amount, again via Shoprite. He received an authentic-looking SMS that purported to come from Nedbank confirming that the loan amount of R15 000 would be transferred into his FNB account. No funds materialised.

Though individuals who have been scammed have no recourse with either the bank or Wonga.com, Urquhart says Wonga.com is working with all the banks to try to find the perpetrators.

“There was a breakthrough last year by working with companies tracking the various IP addresses and emails as well as the bank accounts. This information was handed to the police and the Hawks – we are doing all we can to help,” says Urquhart.

She adds that it is important for the public to be aware that Wonga.com never does direct marketing and existing clients will only receive marketing material if they selected the option to do so. Unsolicited SMSes or emails from Wonga.com will always be fraudulent.

Lucas Venter, senior manager of analytic and forensic technology at Nedbank, says these types of scams are a version of an advance-fee scam – also known as a 419 scam.

“If someone has been offered a loan and is asked to pay upfront fees, they should always confirm the arrangements directly with the company concerned via their advertised call centre – not the number on the SMS. No company will ask for fees to be paid via a money-transfer system,” says Venter.

Earlier this year, the SA Reserve Bank and the Financial Intelligence Centre released a statement calling on everyone with a bank account to ensure that their correct details were lodged with their respective banks to help protect bank customers from fraud, money laundering and similar crimes.

A spokesperson for the Financial Intelligence Centre says: “There are many criminals who try to steal bank customers’ identities, and offer products such as easy loans. Often, these are scams designed to trick people into losing their money or identities, which are then used to commit further crimes.”


WHAT ABOUT FICA?

With all the rules and regulations that surround the opening of a bank account, how are criminals still able to use bank accounts to launder money?

Kalyani Pillay, CEO of the SA Banking Risk Information Centre, says that “to launder money, criminals use accounts that have been opened in full compliance with the requirements set out in legislation, and not only accounts opened with fraudulent documentation”.

“In our experience, the use of false identities or identities that have been tampered with for the opening of bank accounts is declining. As soon as money laundering activity is detected, banks comply with their reporting obligations.”

The Financial Intelligence Centre informed City Press that banks determined and applied their own risk and compliance measures to their various products and services, “including any threshold they wish to apply in respect of certain products. This applies equally to the management of dormant accounts.”

It would appear the syndicates are aware of the reporting and surveillance methods of the banks, so they change bank accounts regularly, withdraw the funds immediately and also ensure the amounts deposited into the accounts fall below the Financial Intelligence Centre Act (Fica) requirement limits.

Syndicates are known to bribe legitimate banking clients to use their accounts to transfer funds.


HOW TO REPORT THE SCAM

Wonga.com is appealing to people to notify it even if they have not acted on a scam SMS using their name, because the more information Wonga has, the more able it will be to track the IP addresses and cellphone numbers, and hopefully tighten the net around the syndicate that’s involved.

If you have been a victim of the “Wonga scam” or received correspondence from the criminal syndicate, please forward the information to Wonga’s fraud hotline on 0861 966 424 or to za.fraud@wonga.com.


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