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Pandemic creates environment ripe for financial scams: BBB

Last Updated Mar 1, 2021 at 7:26 pm PDT

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Summary

Advance Fee Loans top the list of the Better Business Bureau's Top 10 Riskiest Scams for 2020

Canadians lost an average of $1,400 per person to Advance Fee Loan scams — the highest median dollar amount

VANCOUVER (NEWS 1130) – If something is too good to be true, it probably is. That’s always sound advice, but especially now when many of us are short on cash due to the COVID-19 pandemic.

In fact, Advance Fee Loans top the list of the Better Business Bureau’s list of “Top 10 Riskiest Scams for 2020.” The BBB points out Canadians lost an average of $1,400 per person, the highest median dollar loss when compared to the other scams on the list. Online purchases followed at number two, while home improvement scams closed out the top three.

An Advanced Fee Loan is when you pay a fee upfront to borrow money.

“That is actually illegal in Canada,” says Karla Laird, Manager, Community and Public Relations at the Better Business Bureau serving Mainland British Columbia. “And so, a lot of people don’t know that, walk right into a situation where they’re paying money to get money and end up without the loan that they were promised and end up further in debt as well.”

She recommends you do your research before you try to borrow money.

“If they’re asking you for money up-front, walk away. If they say they can give you a loan guaranteed without a credit check, walk away,” she warns. “It’s likely to be a situation you don’t want to end up in.”

Her advice is to only borrow money from lenders licensed by Consumer Protection BC.

Here are the Top 10 Riskiest Scams for 2020:

1. Advance Fee Loan
2. Online Purchase
3. Home Improvement
4. Cryptocurrency
5. Employment
6. Fake Invoices and Supplier Bills
7. Credit Cards
8. Phishing
9. Sweepstakes and Lotteries
10. Counterfeit Products

Read the full report.