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Jul 4, 2011
Loan sharks masquerading as licensed moneylenders

They tout services via fliers, online ads, but are not on approved list
By Mavis Toh

ILLEGAL moneylenders pretending to be licensed operators are becoming brazen, dropping fliers and name cards at the doorsteps of flats and on car windshields across the island.

Some are also advertising their services on classified websites such as and

Touting themselves as licensed operators to unsuspecting borrowers, they offer quick, hassle-free loans at exorbitant interest rates through bank transfers - not unlike the way loan sharks operate.

A check by The Straits Times found at least 10 such operators advertising on various sites online. None of them is on the Insolvency and Public Trustee's Office's list of licensed moneylenders.

Some list company names such as Jenny Finance and Javier Credit. Others simply leave a number and go by names such as Apple and Ivan.

Several of them returned calls made to them last week using overseas numbers, and said they were based abroad but had workers in Singapore. One even said he had an office on Jurong Island.

All eight contacted asked for the caller's confidential SingPass information and passwords to access his Central Provident Fund accounts and get personal and financial data.

Access to the accounts will provide the illegal moneylenders with the borrower's address, contact number, bank account number, and also a means to check that the borrower has a stable income and is not bankrupt.

The illegal moneylenders typically charge interest rates of about 20 per cent and request that borrowers make weekly payments. There is no meet-up between parties, and all loans and payments are done through bank transfers.

When asked if they are licensed, all eight insisted they were operating legally, even though they were not on the approved moneylenders' list.

One operator - Ben Finance, whose fliers were spotted in areas such as Bishan, Hougang and Paya Lebar - said the company has its headquarters in Malaysia, with branches in Kuala Lumpur and Penang.

Asked if the Singapore operation had a physical office, as required under the Moneylenders Act, the operator said its office was on Jurong Island.

But he advised the potential borrower against heading to the office, saying it was more convenient to make the loan through bank transfers.

Another operator, who wanted to be known only as Tommy, said he offered both legal and illegal loans. While he does not have a licence, he would refer those who wanted legal loans to his contacts.

He said: 'The only difference is the method. If illegal, we have to go and check on the houses, and also if (borrowers) don't pay up, we use different means to get the money back.'

Salesman Vernon Tan, 35, is among those who have fallen victim to such moneylenders.

'When I defaulted, they came to my house and harassed me in front of my children and neighbours,' he said in Mandarin, adding that many desperate for money still turn to these dodgy moneylenders when the licensed ones reject them.

Mr David Poh, president of the Moneylender's Association of Singapore, said he is aware that illegal moneylenders are getting runners to distribute name cards and fliers.

Some of these illegal moneylenders operate from Hong Kong and Malaysia, and use pre-paid SIM cards that are hard for the police to trace, he said.

'A lot of people don't know they are not licensed, and this is dangerous because they can be misled,' he added.

Licensed moneylenders, he pointed out, do not ask for SingPass information. In most cases, loans are issued through cheques, not bank transfers, he said.

Licensed moneylenders are also required by law to tell borrowers upfront the terms and conditions of loans, and a written contract must be drawn up in a language that the borrower understands.

Mr Poh also revealed that one of the association's members recently lodged a police report after discovering that loan sharks had used his company name and licence number.

When contacted, a spokesman for the Registry of Moneylenders said that by law, a licensed moneylender must state his business' name in any advertisement or marketing material he issues. The registry will refer any false advertising claims of moneylending to the police.

The police advise the public against borrowing from illegal moneylenders.

First-time offenders convicted of abetting unlicensed moneylending can be fined up to $300,000, jailed up to four years and given up to six strokes of the cane.