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MAINE BUREAU OF CONSUMER CREDIT PROTECTION
35 SHS, Augusta, Maine 04333
State Regulators Warn Consumers About Fake Lender: “North Lake Equity Group”
June 13, 2011
A company claiming to be located in Maine that has offered loans by telephone and over the internet is a scam, say state financial regulators at the Bureau of Consumer Credit Protection.
The company, which uses the name North Lake Equity Group, has been telephoning consumers in several states offering personal loans, if the consumers make several payments to the company in advance. The caller knows a great deal of financial information about the consumers, perhaps from unauthorized access to their credit reports.
The company representative, using the name William Gibson, claims that the company is located on Sanford Road in Wells, Maine. However, the Wells Police Department indicates that no company by the name of North Lake Equity Group exists at that location. The company is not registered with the Town of Wells as a business, nor with the Maine Secretary of State’s Office as a corporation. The address is fictitious, and corresponds to an undeveloped lot between Wells High School and the Wells Town Office.
Consumers from Kentucky, Florida and Tennessee have called Maine’s Bureau of Consumer Credit Protection to ask whether the company is real. One consumer had already paid $887 to the fake company, while another had provided bank account numbers and other personal information.
David Leach, Principal Examiner with the Bureau, is investigating the cases. “All lenders must be licensed,” he said, “and when the first complaint came in we determined that this company did not hold such a license.”
“We next checked the supposed address,” Leach said. “The Wells Police Department looked into the location, and found no such company in that area. In fact, this company is not located anywhere in Maine.”
“The Kentucky consumer was told to make four monthly payments of $230 up front before the loan proceeds would be released; the Florida consumer reported a request for five up-front payments of $177.50; and the Tennessee resident made five such payments before realizing she’d been scammed,” Leach said.
The company’s website has been taken down, but the phone calls have continued. “Consumers should never pay in advance for a consumer loan,” said Leach. “Consumers should not send money to a distant lender through a money transmitter, and they should not reveal their bank account numbers to anyone when the consumers did not initiate the call. These companies can be located in Canada, or on an offshore island, or even in Europe or Africa, and once the consumer sends the money or permits it to be debited from their account it’s impossible to get that money back.”
Leach explained that all states regulate consumer lenders. He warned consumers that if they receive an offer for a loan from an unknown source, they should never commit funds without first checking with authorities in their home state to determine whether the company is licensed and whether other consumers have filed complaints against the company.
“These are difficult economic times,” Leach said, “but consumers in need of a loan must always verify that they are dealing with a legitimate, licensed lender. If they ask for money up front, that’s the biggest indication that it’s a fraudulent scheme.”
The Maine Bureau of Consumer Credit Protection was established in 1975 to enforce a variety of credit-related consumer laws. The Office licenses lenders, creditors and collectors; conducts periodic examinations of creditors to determine compliance with state laws; and responds to consumer complaints and inquiries. The Office also conducts educational seminars and provides speakers to advise consumers and creditors of their legal rights and responsibilities.
Last Updated: June 13, 2011 12:13 PM
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