North Dakota Attorney General Wayne Stenehjem is warning residents to watch for people posing as collectors of payday loan debts. The scammers call individuals and threaten legal action unless payment is authorized from a bank account.
In recent weeks, Stenehjem’s office and the North Dakota Department of Financial Institutions (DFI) have received calls from consumers concerned about such collection calls. The DFI regulates collection agencies and payday lenders.
Most of the consumers report they filled out an online payday loan application but never completed the process. In at least one case, however, the consumer reportedly took out a payday loan in the past from an online lender, but paid off the loan long ago.
The victims reported that the phone calls seem to originate from outside the U.S. Often, the fake collector already knows personal information about the individual, such as their name, Social Security Number and place of employment - which can lead the consumer to think the call is from a legitimate collector. The scammers may ask the consumer to confirm the accuracy of bank account and other information. The information the scammers have on the victim likely has been collected from the online loan application.
In almost every case, the bogus collector threatens the victim with legal action, including a lawsuit or arrest, unless a payment is made immediately. The scammers attempt to force the victim into authorizing a direct withdrawal from a checking account. Some victims reported that they authorized or made payments before realizing they have been scammed.