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Guide Scams and phishing

Advance-fee loan scams: how to spot a fake loan and what to do

You need money quickly and find an ad on social media promising a loan in 24 hours, no credit check. The 'broker' approves you straight away – there's just a fee to pay first for the contract, insurance or verification. Then another, and another. The loan never arrives. Regulators on both sides of the Atlantic warn about it, and Czech police recently described a young man who paid almost 230,000 Czech koruna (about €9,000) in fees over two months. Here's how to spot the scam, how to check a lender and what to do if you've already paid.

Kyberkit editorial team · · reading time 5 minutes

Guide: Advance-fee loan scams

Key points

  • If you're told you've been approved but must pay a fee before the money is released, walk away. The FTC: any up-front fee a lender wants to collect before granting the loan is a cue to walk away.
  • Check that the lender is authorised – in the UK on the FCA Firm Checker, in the US with your state attorney general or banking regulator – and contact it only through those official details.
  • Scammers ask for fee after fee – insurance, verification, 'tax', 'unlocking'. Paying the next one never gets you the loan or your money back.
  • Already paid? Stop paying, call your bank straight away and report it (in the US to ReportFraud.ftc.gov, in the UK to the FCA and Report Fraud). If you sent ID documents, watch for identity theft.

What the scam looks like

Scammers advertise fast loans on social media and classified sites, often with "no credit check" or "bad credit, no problem". When you get in touch, they approve you at once – then ask for a fee before the money can be released: for "processing", "insurance", "paperwork" or identity checks. The FCA says loan fee fraudsters often get in touch after you've applied for a loan online, and push you to pay quickly by bank transfer, gift vouchers or crypto.

How an advance-fee loan scam works – from the ad to fee after fee with no loan1. Ad or message: "Guaranteed loan, no credit check"; 2. Instant "approval", request for ID and personal details; 3. Fee for paperwork, insurance or verification; 4. More fees: "tax", "unlocking", "anti-money-laundering"; 5. The loan never arrives and the broker disappears1Ad or message: "Guaranteed loan, nocredit check"2Instant "approval", request for IDand personal details3Fee for paperwork, insurance orverification4More fees: "tax", "unlocking","anti-money-laundering"5The loan never arrives and the brokerdisappears
Advance-fee loan scam (based on FTC and FCA warnings and Czech police cases)

Real cases

Czech Republic, 2026 – almost 230,000 koruna. A young man in Hodonín wanted to borrow 400,000 koruna. He found a broker on a classifieds site who claimed to work for a well-known German bank. He was told to install an app and enter his personal details, then spent two months paying fees – handling, verification, authorisation, brokerage, "blocking", a contribution "against money laundering" and a "government tax". Only when he asked at his bank did he learn that nobody had heard of the broker (Czech Police, 11 June 2026).

Czech Republic, 2024 – more than 30 victims. A couple offered loan brokerage online. One woman was promised a loan of a million koruna and paid 45,000 koruna in arrangement, notary and other fees. She got no loan and no refund. Over the year the couple targeted more than 30 people and took almost half a million koruna (Czech Police, 25 November 2025).

How to spot it

Any one of these is enough:

  • You must pay before you get the money – for paperwork, insurance, verification, "tax". FTC: "Any up-front fee that the lender wants to collect before granting the loan is a cue to walk away."
  • The loan is guaranteed, whatever your credit history. FTC: legitimate lenders won't promise or guarantee you a loan before you apply.
  • The offer came through social media, a messaging app, a cold call or a classified ad, and the "broker" won't say which firm they work for – or claims to be a big bank.
  • They want payment by transfer, gift cards or crypto, which are hard to trace and recover.
  • They say the fee is refundable. The FCA warns you'll get neither the loan nor the refund.
  • They rush you – "approval expires today".

How to check a lender

  1. Look it up. In the UK on the FCA Firm Checker (the FCA explains how) – check that the firm is authorised for this service and that its contact details match. In the US, contact your state attorney general or banking regulator.
  2. Contact the firm yourself, using details from the register or its official website, and ask whether your loan really exists.
  3. Don't pay anything to "unlock" the loan, not even a "refundable deposit".
  4. Take your time. Pressure to decide today is a warning sign in itself.

Already paid or sent documents?

Decision tree – what to do after dealing with a fake loan brokerDid you install an app they sent you? – yes: Disconnect the device from the internet, uninstall the app and call your bank; Did you give card details or online banking access? – yes: Call your bank now – block the card, change your login, review payments; Did you send a photo of your ID? – yes: Report it and watch for credit or accounts opened in your name; Did you pay a fee? – yes: Call your bank straight away – the sooner, the better the chance of stopping it; no: Report the scam and don't pay anything moreDid you install anapp they sent you?Disconnect thedevice fromthe internet,uninstall theapp and callyour bankyesnoDid you give carddetails or onlinebanking access?Call your banknow – blockthe card,change yourlogin, reviewpaymentsyesnoDid you send a photoof your ID?Report it andwatch forcredit oraccountsopened in yournameyesnoDid you pay a fee?Call your bankstraight away– the sooner,the better thechance ofstopping ityesnoReport the scam anddon't pay anythingmore
What to do, depending on what you gave the scammers
  1. Stop paying. Not even the "final" fee that's supposed to release the loan.
  2. Call your bank on the number on your card or its official website. Ask whether the payment can be stopped or recalled, and block your card if you shared its details.
  3. Remove any app the broker had you install, and change your email and banking passwords from a different, clean device. See I entered my details on a scam site.
  4. Report it. In the US at ReportFraud.ftc.gov; in the UK to the FCA and then to Report Fraud, as the FCA advises. Keep payment records, phone numbers, the ad and screenshots of the conversation.
  5. Beware of round two. Anyone who contacts you offering to recover your money for a fee is another scammer – see Recovery scams.
  6. Sent a photo of your ID? Freeze your credit or protect your details with your national fraud prevention service – see I sent a photo of my ID to a scammer.

If you need money

These scams target people who need cash fast and have been turned down elsewhere. If you're struggling, free debt advice or a conversation with your own bank is a safer first step than a loan from an ad. The FTC suggests free or low-cost credit counselling from nonprofit organisations. Only borrow from a lender you found and checked yourself.

FAQ

Is it normal to pay a fee before a loan is paid out?

Treat it as a red flag. The FTC says any up-front fee a lender wants before granting the loan is a cue to walk away, and that nobody legitimate will tell you paying a fee guarantees a loan. Real lenders may charge an application or appraisal fee, and in the UK authorised firms that charge an up-front fee must send you a formal notice you have to agree to first – but a broker on social media asking for a transfer or gift cards is a scam.

I've paid one fee and now they want another or I'll lose everything. Should I pay?

No. That's how the scam works: after the contract fee come insurance, verification, notary, 'tax' or 'unlocking' fees. The man in the Czech police case paid fees for two months and never got a loan. Paying more won't recover what you've lost – it only adds to it.

How do I check whether a lender is real?

In the UK, use the FCA Firm Checker and contact the firm only with the details listed there. In the US, check with your state attorney general or banking regulator, and search the company name or phone number with words like 'complaint' or 'scam'. Scammers often pose as well-known banks, so a familiar name on its own proves nothing.

I sent them a photo of my ID. What now?

Documents can be used to open accounts or take out credit in your name. Report it along with the scam, tell your bank, and keep an eye on your credit report and any letters from lenders you've never dealt with. In the US, follow the steps at IdentityTheft.gov.

Can I get my money back?

Sometimes, if you act fast. Call your bank immediately – a payment can occasionally be stopped. The FCA warns you won't get the loan or the 'refundable' fee from the scammer. And ignore anyone who contacts you afterwards offering to recover the money for a fee: that's a second scam.

Sources

  1. FTC – What To Know About Advance-Fee Loans (July 2022)
  2. FTC – Report fraud (ReportFraud.ftc.gov)
  3. FCA – Loan fee fraud (last updated 31 March 2026)
  4. Czech Police – He wanted to borrow money (Hodonín, 11 June 2026, in Czech)
  5. Czech Police – Don't respond to loan brokers on social media (Ústí nad Labem Region, 25 November 2025, in Czech)
  6. Czech Police – Beware of fake loans (Ústí nad Labem Region, 11 December 2025, in Czech)

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