Report Unlicensed Money Lender: Protect Yourself from Financial Scams in Singapore

If you’re in need of a loan, it’s important to recognise the difference between licensed and unlicensed moneylenders. While licensed moneylenders are regulated by the Singapore government and operate within the law, unlicensed moneylenders are not, and often resort to illegal and unethical tactics to collect debt. If you’ve borrowed money from an unlicensed moneylender, you could be putting yourself at risk of harassment, intimidation, and even violence.

A person anonymously reporting an unlicensed money lender to authorities

Fortunately, there are steps you can take to protect yourself and report unlicensed moneylenders. The first step is to identify whether your moneylender is licensed or not. You can do this by checking the list of licensed moneylenders on the Ministry of Law’s website. If your moneylender is not on the list, it’s likely that they are unlicensed. You should also be wary of moneylenders who advertise their services through flyers, SMS messages, or social media, as these are often unlicensed operations.

If you suspect that you’ve borrowed money from an unlicensed moneylender, it’s important to take action to protect yourself and report the lender to the authorities. This could involve contacting the police or the Registry of Moneylenders, who can investigate the lender and take steps to shut down their operation. By reporting unlicensed moneylenders, you can help to protect yourself and others from the dangers of illegal moneylending.

Key Takeaways

  • Recognise the difference between licensed and unlicensed moneylenders.
  • Be wary of moneylenders who advertise their services through flyers, SMS messages, or social media.
  • Take action to protect yourself and report unlicensed moneylenders to the authorities.

Recognising Unlicensed Moneylenders

A person reports an unlicensed money lender to authorities

If you’re in need of a loan, it’s important to know how to identify unlicensed moneylenders. Here are some warning signs to look out for:

Warning Signs

  • Unsolicited loan offers: If you receive a loan offer out of the blue, it’s likely from an unlicensed moneylender. Legitimate lenders don’t typically cold-call or send unsolicited text messages or emails.
  • High-interest rates: Unlicensed moneylenders often charge exorbitant interest rates that can exceed the legal limit of 4% per month. Make sure you understand the interest rate and other fees before signing any loan agreement.
  • No contract or unclear terms: A legitimate lender will provide you with a contract that outlines the terms and conditions of the loan. Be wary of lenders who don’t provide a contract or who have unclear terms.
  • No due diligence: A legitimate lender will conduct due diligence to ensure you can repay the loan. If a lender doesn’t ask for proof of income or doesn’t care about your credit history, it’s likely they’re unlicensed.

Comparing Licensed and Unlicensed Practices

Licensed moneylenders are regulated by the Registry of Moneylenders and are required to follow certain rules and guidelines. Unlicensed moneylenders, on the other hand, operate outside the law and can be dangerous.

Here are some differences between licensed and unlicensed practices:

Licensed MoneylendersUnlicensed Moneylenders
Operate legally and are regulated by the governmentOperate illegally and are not regulated
Charge interest rates of up to 4% per monthCharge exorbitant interest rates that can exceed the legal limit
Have clear terms and conditions in loan contractsMay not provide a contract or have unclear terms
Conduct due diligence to ensure borrowers can repay the loanMay not conduct due diligence
May charge late payment fees and administrative feesMay charge excessive late payment fees and administrative fees
May offer secured and unsecured loansMay only offer unsecured loans
May lend to Singapore citizens, permanent residents, and foreigners with valid work permitsMay only lend to foreigners or Singaporeans who can provide collateral
Must display their licence number in all advertisementsWill not have a licence number

It’s important to do your due diligence and research any lender before taking out a loan. If you suspect a lender is unlicensed, you can report them to the police or the Registry of Moneylenders. Remember, taking out a loan from an unlicensed moneylender can lead to harassment, legal costs, and even physical harm. Stay safe and only borrow from licensed lenders.

Taking Action Against Illegal Moneylending

A person reports an unlicensed money lender to authorities, showing evidence of illegal activity

If you suspect that someone is operating an unlicensed money lending business, you should report it to the authorities immediately. Here are some steps you can take to report unlicensed money lenders:

Reporting to Authorities

You can report unlicensed money lending activities to the police by calling the police hotline at 1800-255-0000 or submitting an online report on the Singapore Police Force’s website. You can also report the money lender to the Registry of Moneylenders at 1800-2255-529.

Legal Recourse and Support

If you have borrowed money from an unlicensed moneylender, you should be aware that you are not legally obliged to pay back the principal, fees, and interest. You can seek legal recourse and support from government agencies such as the Ministry of Law, Credit Counselling Singapore, and ComCare.

Licensed moneylenders, on the other hand, are regulated by the government and must adhere to strict rules and regulations. You can borrow money from licensed moneylenders if you are in financial need, but you should be aware of the interest rates, repayment terms, and processing fees before signing a loan contract. You can find a complete list of licensed moneylenders on the Ministry of Law’s official website.

To borrow money from licensed moneylenders, you will need to provide your SingPass user ID and undergo face-to-face verification. You should also be aware that loan approval fees and GST may apply.

If you are a victim of loan shark harassment, you can seek help from the National Crime Prevention Council and the police. Loan shark harassment is a crime that carries a penalty of imprisonment, fine, and caning.

In conclusion, taking action against illegal moneylending is crucial to protect yourself and others from financial exploitation and harassment. By reporting unlicensed money lending activities to the authorities and seeking legal recourse and support, you can help to prevent and combat this crime.

Frequently Asked Questions

A person reading a "Frequently Asked Questions" report on unlicensed money lending. The report is open on a desk with a pen and a cup of coffee nearby

What steps should you take to report a loan shark in your area?

If you suspect that someone is operating as an unlicensed moneylender in your area, you should report it to the authorities immediately. You can do this by contacting the police or the Registry of Moneylenders. Be sure to provide as much detail as possible, including the lender’s name, address, and any other relevant information.

Can you tell me how to handle harassment from an illegal money lender?

If you are being harassed by an unlicensed moneylender, you should report it to the authorities immediately. Do not engage with the lender, and do not make any payments until you have spoken to the police or the Registry of Moneylenders. Keep a record of all communications and report any threats or acts of violence to the police immediately.

What are the consequences for someone caught engaging in unauthorised money lending?

The consequences for engaging in unauthorised money lending can be severe. Offenders can face fines of up to $300,000, imprisonment for up to 4 years, and six strokes of the cane. Repeat offenders can face even harsher penalties.

Could you explain the legal process for reporting illicit lending activities?

If you suspect that someone is engaging in illicit lending activities, you can report it to the police or the Registry of Moneylenders. The authorities will investigate the matter and take appropriate action. If the lender is found to be operating illegally, they may be prosecuted and face fines and imprisonment.

Where can you find information on the legislation regarding moneylenders and unlicensed lending?

You can find information on the legislation regarding moneylenders and unlicensed lending on the website of the Ministry of Law. The website provides information on the Moneylenders Act and the regulations governing licensed moneylenders in Singapore.

What term is commonly used to describe someone who lends money without a licence?

Someone who lends money without a licence is commonly referred to as a loan shark or an unlicensed moneylender. These individuals often use illegal and unethical tactics to collect debts and can cause serious harm to borrowers who are unable to repay their loans.

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