At CEL Solicitors, we regularly review complaints where the loss suffered from a client originates from a loan, or multiple loans taken out for the purposes of a scam. Scammers will regularly place pressure on their victims to take out these loans and when the scam is revealed their victim is left with the debt and the reoccurring interest payments which in many cases can financially cripple a UK household.
The use of loans to fund a scam are especially common within Investment scams, scammers regularly advise their victims that the possible profits of investing the loan will be greater than the required monthly interest payments. In the current economic circumstances, a UK homeowner may find these promises incredibly appealing. As experts in the sector, we can assure anyone who is being approached by an individual asking them to take out a loan to fund an investment is falling victim to a scam and should cease contact with the individual.
The real issue behind these manipulative and crippling tactics employed by scammers is the debt their victims are left with as a result, this can cause lower credit ratings and legal action from the debt holder, in the form of an IVA or CCJ.
These consequences can be life changing and damaging to individuals who wish to obtain a mortgage, further loans or a credit card, many landlords and estate agents will ask prospective tenants if they have any IVA’s or CCJs which may have a negative impact on renting a home.
At CEL Solicitors we care deeply about our clients and the impact these scams have had. We encourage anyone who has taken out a loan for the purposes of a scam to report the scam to their loan provider, in some cases, when we have reached out to the loan provider and explained the context behind the loan, interest payments have been frozen or removed.
Support is out there for those who are in crisis as a result of a loan:
- StepChange is a charity set up where individuals can seek debt advise and tailored plans at your own pace.
- The National Debtline provides free, confidential, and independent advice on dealing with debt problems within the UK.
- You are also able to speak with your bank, many of the High Street Banks have teams in place to talk you through your money worries and can offer support in managing debt.