Loan sharks lying about liabilities

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Loan sharks lying about liabilities

Last month, Mr. Park received a call from a private lending company. The voice on the other end informed him that his mother had applied for a loan and needed a witness. Would he agree to play that role?

Mr. Park checked with his mother and agreed to be a witness for the loan application. He specifically asked the private lender if he was jointly liable for the loan. The company assured him he was not.

But when Mr. Park’s mother missed interest payments on the loan, the story changed. The lender said Mr. Park was jointly liable and he had to pay off both the loan principal and the interest.

The Financial Supervisory Service Tuesday warned against frauds like the one that befell Mr. Park. It said such cases of misstated liabilities for loan payments have been increasing.

The most common tactics employed by private loan sharks are the kind that snagged Park. In another case, a Seoul resident named Kim was asked by a friend in March to sign up for joint liability on a loan. Kim was told the liability would automatically expire after two months. It was a complete lie.

In February, a Seoul resident was asked by a colleague at work to sign on for joint liable for a loan and received a call from the loan shark. It turned out the work friend had loans with joint liability from four lenders,

“The best way is not to respond to calls or text messages on loans that you have little or no information on,” said a FSS official.

The FSS suggested that people record all conversations that are made about loans so it can later be used as evidence. All frauds should be reported to the FSS.


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