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Avoid Loan Shark Scam Schemes In Singapore

Recently, many news features the various loan shark scam schemes. Watch out for these to avoid being victims of illegal money lenders in Singapore.

Recent News on Loan Shark Scam

Last June 6, a 19-year-old was apprehended along Woodlands Avenue 2. It was after reportedly splashing paint and creating loan shark-related graffiti on a residence at Tampines Street 45. Aside from the said case, the youth is a suspect for being involved in similar Bedok and Bishan activities.

On June 2, there were a report in the Criminal Investigation Department (CID) officers. Also, together with 6 other police divisions, stormed various locations across Singapore and arrested 104 suspects (18 to 72 years of age) for getting involved in loansharking activities.

Upon preliminary investigations, they discovered that four are runners who carried out ATM transfers and secured ATM cards for loan sharks.

Three were the harassers who vandalized walls and splashed paints on private properties. The last suspect provided a different home address when getting a loan from an unregistered moneylender.

The rest have to open bank accounts and give the ATM cards and PIN codes to loan sharks to facilitate the illegal moneylending business.

Another recent story of loan shark harassment was later in November last year. A Singaporean man shared his dilemma of owing $13,000 from a loan shark.

In desperate need of cash, he borrowed $700 from an illegal money lender. However, after failing to pay for a week, his loan interest grew. Thus, it made a full-blown debt out of it.

He shared that he regretted waiting too long to ask for help. Now, it drastically affected his whole family. The loan sharks began to knock on his door. Plus, the experience traumatized his youngest daughter for months.

Ah Long San, the Infamous Shark

For many years, Singapore has been battling loan shark scam schemes. It takes advantage of the people’s needs, posing as a quick help when in truth, they aim to milk all the money they could get from the borrower.

As a result, illegal moneylending has been a severe problem. During the 1990s, Chua Tiong Tiong, commonly known as Ah Long San, was still prominent.

Ah Long San is the infamous loan shark king. He led the 90’s multi-million illegal moneylending syndicate. That’s why he was one of the most feared and slippery criminals in Singapore’s history. However, he was able to dodge arrests by bribing nine police officers. As a result, those who have information about his whereabouts have kept themselves tight-lipped for fear of their loved one’s safety.

Ah Long San Scheme

According to The New Paper, Ah Long San would use the ‘profit-sharing scheme’ for his illegal money lending business. He will loan $50,000 to his senior assistants, who will lend them to needy Singaporeans. The senior assistants’ responsibility is to collect the money with ceiling interest.

They pocket half of the amount collected. If they can’t pay to deliver the boss’ money, they will be the ones in trouble. Thus, they have to do any illegal means, including unlawful measures, to get the money.

Loan shark scam usually charges 20% of interest to their loans. So, for example, when a borrower asks for a $1,000 loan, the lender will only give $800 and keep the $200 as interest.

If the borrower pays $600 for the next week, the loan status remains unpaid. The lender will count the payment as only $400 and pocket the $200 as interest. This way, the borrowers end up paying 100% interest.

If the borrower cannot keep up with the payments, the debt will increase. If they could not pay anymore, they might decide to turn into a runner or end up as the loan sharks’ pawns.

Tactics to Cover their Tracks

Illegal money lending is a serious matter for the police. Debtors use various ways to cover their tracks, usually using their own borrowers.

  1. Lenders only use the prepaid mobile numbers registered to their borrowers’ names. This way, they will be hard to track. Moreover, if the police try to trace the mobile number owner, they will only end up with another borrower.
  2. Debtors have to open banks accounts. Then, they hand the ATM card and access code to the lender. This way, the loan sharks can make anonymous withdrawals. However, the track will only lead back to the debtor.
  3. If debtors have no other way to pay, lenders convince them to gamble outside the country or in ships. If the debtors lose, they will only get more debts to pay. Plus, the lenders won’t have their names on anything.

The Danger in Social Media

Nowadays, people are negligent in putting their personal information online. Illegal money lenders use the information on your social media accounts to get personal data and other information. They can use it to blackmail you. So it is better to be wary when posing anything on the web than regret it later.

Also, secure your social media accounts with passwords and other security features offered in the social media apps. This way, your accounts won’t be easily hacked.

Illegal Moneylending Scam Schemes

Phone Calls

Loan shark scam uses abusive language when making a call. Also, they could be using another debtor’s number.

They will threaten you and make you pay for a loan that you did not even take. Usually, they threaten your loved ones and continue communicating via calls and SMS. In addition, they might even scare you to deposit money in their bank accounts.

If you have previous or existing loans with other loan sharks, they will take advantage of it. They will leak this information to the police. People who are usually a victim of this loan shark scam find it difficult to get help from authorities. There is for fear of embarrassment.

SingPass

It is illegal to keep another person’s SingPass. Even legal moneylenders prohibit such doing. If a loan shark scammer gets your SingPass, they can quickly get your personal information, including your financial data. Then, they can fake your identity and use it for other illegal transactions or get loans from other moneylenders. So, you will end up paying for loans you did not use.

Letters and Harassments

Some loan sharks use letters to threaten their victims. They will keep on sending letters though you might have not even borrowed anything from them.

If they can’t get in touch with you by chance, they will even paste the letter on your door for passersby to see. Since Singaporeans value their reputation, embarrassment is unthinkable. Sometimes, loan sharks even lock the debtors inside their homes using bicycle locks. Other set fences and gates on fire.

Facebook and other Social Media

Harassments don’t just stop at the victim’s doorstep. They now use Facebook and other social media platforms to harass their victims for all on the web to see. Plus, they even send a friend request to the family and friends about the debtor’s loan.

Debtors Turned into Runners

The loan shark scam thrives on fear, emotional stress, and humiliation. No matter what happens, despite the enormous need for quick cash or ominous threats they use, never succumb to loan sharks. Remember, they only bring spiralling debt. If trapped, Singaporeans cannot get out of the loan sharks’ grip turn into runners.

The Consequence of Falling into a Loan Shark Scam

Unfortunately, many loan shark victims get involved with the illegal moneylending business to repay their loans. However, despite the pitiful state of the victims and their desperate situation, the court is firm to implement the Moneylenders Act, or else the cycle of exploitation will never end.

The runners harass other debtors in exchange for their unpaid loans. However, they should know how stressful and fearful it is to be hounded by loan sharks.

Despite diverse situations, there should not be enough reasons to do it to another person and make them feel the same helplessness they endured first-hand. In the first place doing business with an unlicensed moneylender already violated the Moneylenders Act.

First Offence

Those who demand or collect money open a bank account, provide a prepaid SIM card, keep business records, provide collected personal information of another person, and participate in banking transactions. Let’s own premises used for or by a loan shark. They are subjected to imprisonment not exceeding 4 years and a fine of not less than $30,000 and not more than $300,000 with 6 strokes of the cane.

Second Offence

For the second offence, the convicted has to be imprisoned for 7 years and pay a fine not less than $30,000 and not more than $300,000 with 12 strokes of a cane.

Guilty

Those who are found guilty of harassing a person, either attempted or committed in behalf of a loan shark will be imprisoned for no more than 5 years and has to pay a fine of not less than $5,000 and not more than $50,000, and has to receive not less than 3 and not more than 6 strokes of the cane.

Time to Step Up Against Loan Shark Scam Schemes

The serious problem on Ah Longs (illegal money lenders) has been battled for quite some time now. For this reason, the regulations in money lending have been more uptight. However, the campaigns against ah longs are still at their heights, promoting legal moneylenders with flexible loans instead of loan sharks.

At Cash Mart has always supported various campaigns and movements against loan sharks. We have always been creating flexible loans with terms personalized for each client, and our staff practice professionalism at all times. The team behind Cash Mart never stops finding ways to cater to products available for Singaporeans and foreigners in Singapore from all walks of life.

Suppose you have any information on any ah long related activities or person. In that case, we encourage you to call 1800-X-AH-LONG or 1800-9-24-5664, the Police Emergency Hotline (999) or get in touch with the Registry of Moneylenders at telephone number: 1800-2255-529 or at its e-mail address: OneMinLaw@mlaw.gov.sg and rest assured your identity will be kept anonymous.

Ministry of Law | Loan Shark Scams Schemes

If you know someone currently in the grip of a loan shark, please help them by reaching out on the X-Ah-Long Hotline. It is time to work together and put a stop to the terror brought by loan sharks in the lives of our fellow Singaporeans.