KUALA LUMPUR: How do you convince people that they will get cheap loans and then cheat them of millions of ringgit, all without even meeting them?
One way is to start with a persuasive script and saying the right things at the right time.
This is what the police discovered after busting a loan scam syndicate operating out of apartments in Kajang and Cheras recently.
Among the items seized was a guide book on what to say to potential victims during phone conversations or chats on social media.
Since 2016, the police have arrested about 3,600 people who used similar tactics.
Claiming to be licensed moneylenders, these conmen entice the desperate or greedy with the promise of low-interest loans.
These “borrowers” then fork out large sums of money for fake administrative expenses, stamp duties and legal fees.
According to the police, the scammers collected at least RM90mil over three years.
Thanks to technology, there is no need for face-to-face meetings.
These syndicates go online to promote loans at interest rates as low as 0.5% and usually communicate with their victims via WhatsApp.
Victims who take the bait are tricked into paying exorbitant fees but get no loans in the end.
Members of these syndicates, described by the police as “worse than Ah Longs”, are equipped with scripts that take them through the steps in manipulating their targets.
For example, when the “borrowers” ask whether they need to give deposits, the syndicate members are taught to reply that upon approval of the loan application, the only payment to make is for legal fees on the agreement.
If “borrowers” want to know why the fees cannot be set off against the loan, the “correct response” will be the “moneylenders” can only release the full sum of the loan.
Deputy Comm Datuk Saiful Azly Kamaruddin said no matter how absurd the fee, victims kept paying.
The Bukit Aman Commercial Crime Investigation Department (CCID) deputy director said that in some cases, the fees were even higher than the loans.
“In one case, a victim applied for a RM20,000 loan but ended up paying RM30,000 in additional fees,” he told a press conference.
DCP Saiful Azly said the scammers typically went after those who were financially desperate, naive or fuelled by greed.
“It is the classic three Ks of victimhood – kesusahan (hardship), ketamakan (greed) and kejahilan (ignorance),” he said.
“The cases are increasing every year,” he said.
DCP Saiful Azly said in 2016, the department recorded 1,505 cases, resulting in RM17.4mil in losses and 172 people arrested, followed by 3,458 cases last year with RM36.9mil in losses and 734 arrests.
“As of Wednesday, we’ve recorded 3,903 cases and arrested 2,698 people, with total losses so far this year at RM36mil,” he added.
These syndicates pretended to offer loans of between RM5,000 and RM100,000, he added.
“We believe they rake in between RM20,000 and RM50,000 in profits daily with an average two victims.
“The syndicate members are paid up to RM3,000 monthly. They also earn a 5% commission on each successful scam they pull off,” he said.
In the latest case, a loan scam syndicate said to be responsible for 32 cases and some RM500,000 worth of losses was busted following a raid on a house and eight condominium units in Kajang and Cheras on Nov 13, DCP Azly said.
Among the items seized were 53 mobile phones, three vehicles, five laptops, and 17 notebooks with the details of 1,707 victims.
CCID officers also stumbled upon drug operations linked with the syndicate and seized drugs including 6,270 Erimin 5 pills, over 1,600 Ecstasy pills and 1kg of ketamine.
“We arrested 21 Malaysians aged between 17 and 27, including the mastermind of the operations.
“We believe the syndicate started in August,” he said, adding that they moved their operations centre from time to time to avoid detection.
DCP Saiful Azly advised the public not to fall for such scams and to always be wary of loan offers, be it from individuals, financial institutions or money-lending agencies.
“Don’t be easily enticed by advertisements.”
Here is how the loan scam syndicates grab millions from victims.
1. Posing as licensed moneylenders, the scammers advertise online and communicate with victims via WhatsApp.
2. Each syndicate member has a guidebook detailing the steps to dupe victims.
3. After agreeing to take a loan, the victim is required to WhatsApp personal documents to the syndicate. He receives the loan letter through the same channel and he will be asked to pay an “agreement fee” of 6% of the loan amount.
4. After the victim transfers or deposits the agreement fee and shows proof of the transaction, the scammer tells him of a 10% “stamping fee”.
5. Next, the victim learns that he has been blacklisted by credit reporting companies and that he has to pay another 20% fee to clear that hurdle.
6. Finally, he must cough up a bank processing fee of between RM1,000 and RM2,000.
7. Once the victim has paid all the charges, he soon finds out that there is no loan and he can no longer get in touch with the syndicate.