FOR IMMEDIATE RELEASE:   May 8, 2002

EAST LANSING. The Michigan State Police is warning Michigan residents about a loan scam originating out of Canada that could cost victims thousands of dollars.

The scam, sometimes called the Advanced Fee Loan Scam, is promoted through local newspaper advertisements that read, "In Debt, Need Money? $$$ Loans, Loans, Loans! Call Toll Free 1-800-XXX-XXXX, Good, Bad, or No Credit." According to MSP officials, once the victim is "hooked", the company will ask for an advance fee ranging from less than $100 dollars to thousands of dollars. Once the money is sent or wired, the victim may receive a rejection letter indicating they were turned down for the loan. Advance fee loans are illegal in the United States and Canada.

In one recent case, the MSP Criminal Intelligence Unit received a call from a citizen in April after he became suspicious about a consolidation loan he had applied for in an advertisement in a Sault Ste. Marie newspaper. According to F/Lt. David Peltomaa of the MSP Criminal Intelligence Unit, "The victim was faxed what appeared to be official looking forms from a company called Fairfield Insurance out of Toronto, Ontario. The company proposed to find the best company to provide a loan." Peltomaa went on to say, "We checked the validity of the company and could fine no such organization in Toronto." Officials reported that the loan company recommended to the victim, Millstone & Shapiro in New York City, also could not be located. "In this case, the victim almost lost $1200 to this scam," stated Peltomaa. The incident remains under investigation by State Police detectives in Sault Ste. Marie.

The MSP CIU reports that numerous scams of this type are originating out of Canada. MSP has notified the Canadian Better Business Bureau as well as the New York State Police Criminal Intelligence Unit. The public is cautioned that legitimate lenders never "guarantee" or say that you are likely to get a loan or a credit card before you apply, especially if you have bad credit, no credit, or a bankruptcy.

More information can be found at the Canadian Better Business Bureau site located at: