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A customer of mine has been offered
a large loan. The borrower owns and operates a farm in
Southern California and, frankly, could use a large
infusion of cheap money. I have been aware of this
ongoing loan for some weeks and had expressed MAJOR
CONCERNS that the broker (an Ohio company) had already
received $5,000 to “get started”. I warned my
customer that “up front” brokerage fees are
usually prohibited or at least severely regulated by
the appropriate licensing agencies.
The oldest scam in the book is to
offer large amounts of cheap “foreign” money to
businesses for commercial projects that are “desperate
for cash”. Over the years I have seen scams that
have involved from $10,000 to $30,000 “up front”
commissions to arrange $1 million, $2 million and $10
million off shore loans. Unfortunately, businesses and
borrowers truly in need are often the most gullible.
Sure enough, my customer received a
multi-page loan agreement that he sent to me for
review. The agreement asked for more fees (in
certified funds) to continue with this multi-million
dollar loan. The best part was that the agreement
stated: “none of this documentation can be shared or
disclosed to anyone other than your business partner,
accountant or lawyer as this may be construed as a
violation of Federal law”, i.e. please keep this a
secret. |
Fortunately for my client, the person
signing the letter had a VERY unusual first name. I love
unusual names, as they are very easy to check out. Simple
names like John Smith are almost impossible. Within five
minutes I discovered seven CRIMINAL complaints filed against
this individual and one criminal complaint filed against a
person with the same last name also associated with this
company. Fortunately my customer did not pay the last two
fees requested and was able to stop payment on one of two
checks previously submitted.
Please remember this scam. It’s one of
the oldest and it truly victimizes desperate people who
often borrow the up-front fee, thinking that they will
receive a windfall in a short period of time. If you are in
the process of applying for a large real estate loan or
business loan, be very careful. If you know the company that
you are dealing with and the fees are truly appraisal fees
or toxic inspection fees, that is one thing. If large
up-front fees are involved PLEASE, PLEASE, PLEASE refer this
to your business attorney or CPA. The naivete of otherwise
intelligent people paying $10,000 to $30,000 to an unknown
company is truly amazing. Please have a company like this
checked out from stem to stern before dishing out large sums
of money in the hopes of obtaining those cheap offshore
funds.
Peter Rosenthal
VIP Trust Deed Company |