For Immediate Release	CONTACT:	Holly Anderson, ext. 114
December 2, 1997
		(202) 835-3323

WASHINGTON, D.C.... The National Consumers League issued a warning today about advance fee loan scams. According to the League's National Fraud Information Center, complaints about advance fee loan scams are on the rise, as consumers look for ways to pay off extra bills and finance holiday shopping.

The typical scenario: a cash- and credit- strapped consumer responds to an advertisement offering "credit consolidation." The consumer is told that he or she qualifies for a loan, but that an advance fee is required. The consumer sends the required fee -- reports to the Center range from $300 to $5,000 -- and never gets the "loan" or hears from the company again.

"Cash- and credit-strapped consumers are looking for any way to get extra money to brighten the holidays. That's why these advance fee loans are so attractive to them," says Linda F. Golodner, NCL president. The con artist promises a large loan --usually for thousands of dollars -- in exchange for an advance-fee payment. "But remember, it is against the law for a company -- for anyone! -- to charge you up-front for a loan," cautioned Golodner.

According to NFIC reports, most of the companies are operating out of Canada.

Here are some warning signs and tips on avoiding becoming a victim:

• never pay a fee in advance to secure a loan

• if you need help consolidating your debt, contact a Consumer Credit Counseling Service. It is a national nonprofit organization that will help you reduce your debt. It may charge a nominal fee.

• be wary of companies that ask you to send money via a private, third carrier. Con artists try to avoid using the U.S. Mail because of federal law enforcement rules.

• check out an offer or file a complaint with the National Fraud Information Center using our toll-free hotline 800-876-7060 or the web <www.fraud.org>.

For more information, write or call the National Consumers League at 1701 K Street, N.W., Suite 1200, Washington, D.C. 20006, (202) 835-3323. Log on to NCL at www.nclnet.org and NFIC at www.fraud.org.

The National Consumers League, founded in 1899, is America's pioneer consumer organization. NCL's three-pronged approach of research, education and advocacy has made it an effective representative and source of information for consumers and workers. NCL is a private, nonprofit membership organization dedicated to representing consumers on issues of concern.