Misleading advertising and debt money scams on social media.

There has been a proliferation of false, misleading advertising and debt money scams in recent times.

Desperate consumers are lured by scammers, only to realize the company in question has no contact details and has disappeared with their money.

Consumer Debt Support hope to add value to this journal for consumers, https://www.debtcenter.co.za/ advising them to take extra care with whom they contact to do business. This article is in line with the serious warnings issued by the National Credit Regulator (NCR) to consumers, urging them to be extra vigilant in order to ensure they deal only with registered debt counsellors. Unregistered individuals and companies are using scams to steal consumers’ money.

It is becoming the norm for companies to use social media platforms to sell their services and share information about new products. Users of Instagram, Facebook, LinkedIn, Twitter, and Google, amongst others, are exposed to a flood of advertising. They provide easy options to connect with these companies by having an agent contact you directly.

Misleading and false adverts to avoid:

1. Ads enticing consumers to take up debt consolidation;
2. Ads for debt mediation to pay less on your debt;
3. Ads guaranteeing Debt Review removal;
4. Ads about “government methods” to write off debt;
5. Ads aimed at women over 50 who can allegedly have their debts written off;
6. Ads with no visible NCRDC number;
7. Ads promising paying 50%;  63%; 70% or 80% less on debt;
8. Ads offering Debt Mediation and alternative to debt review;
9. Ads promising your debt paid over 18 -24 months, then you debt free;

The only motive of these ads is to steal consumers’ hard-earned cash. This makes such advertisements a criminal activity.

Finding these dodgy companies is an impossible task. NCR task teams try to investigate these companies. Their contact numbers often don’t work or cannot be found on the mobile and Telkom servers.

Consumers must be aware of the fact that there is no magical cure for debt problems!

There are no quick fixes or debt write-offs available to you. There are no government methods available to have debts written off and there is no special relief if you are over a certain age. There is no High Court Ruling that allows any person to have their debts written off after having entered into an agreement to pay the relevant debt for the money you borrowed. No individual has a magic wand to make debts disappear! There is no easy way to dismiss debt and remove default information from a credit report.

These companies are merely after your cash and have no magic wand to wave to make your debt or debt review status disappear. They usually:

1. Charge R5 000, R6 000 or R8 000 and more for a debt review removal;
2. Charge a fee up to R12 000 to apply on your behalf for debt removal from a credit report;
3. Offer to reduce your monthly debt repayments in debt mediation. They then charge you to, pay them your reduced instalment towards fees for the first and second month.
4. Charge R8000 to terminate the debt review with the NCR letter, form 16’s that is fraudulent documents used to make consumers believe the process is legit.

Be aware: companies or individuals can’t offer these services if they are not registered with the NCR. Registered credit providers will not work with these companies as debt review is the only method available to consumers. If you engage with such a scammer, your money will be lost, and you will have paid for a non-existing service. You will realize too late you have been defrauded of your money.

How to verify the validity of a company or individual:

1. Visit Hello Peter to look for complaints;
2. Visit the NCR website to check the register of registrants;
3. Call the NCR if there are complaints against an advertiser offering debt exits;
4. Search Google for businesses and check the reviews by clients;
5. Request a copy of the valid debt counselor certificate;
6. Let the person prove they are registered with a valid PDA (Payment Distribution Agent) who receives and distributes your hard-earned money to your creditors;
7. Form 16 must have all the details of the debt counsellor, company name, registration number, full disclosure of address and contact details;
8. The NCR register will verify all the details on the Form 16;
9. Electronic signing, do not send your signature via email or WhatsApp to any person;
10. Do not share your ID numbers or documents until you verify who you are dealing with;

If the company is not registered, please do not share your personal information with them.

It is time to get back to basics.

If you cannot identify the person advertising a service, it is hidden for a purpose. This purpose is to hide their identity so you would have no recourse (no claim or ability to lodge a complaint with the NCR) and eventually realize you have been scammed!

If your bank is not willing to grant you a new loan, credit card or a consolidation loan, the reason for this is because you can’t afford to repay the loan. When you are granted a consolidation loan with a company, you have to pay money to improve your credit score before that loan is paid to you. This should be a clear warning to you that something is not in order.

Only registered debt counsellors can assist you with your debt, and if there is no “NCRDC” registration number with a physical business address and legitimate, working phone number provided, they are most likely not registered and trained persons who can assist you with your debt situation. Check Hello Peter for scam alerts before answering any advertising.

No one but an NCR registered debt counsellor can fulfil the duties of a registered debt counsellor.

1. ADR can’t fulfil the duty of the debt counsellor;
2. An attorney can’t fulfil the duty of the registered counsellor; unless registered as a debt counsellor;
3. No individual or company not registered with the NCR can offer the services of a registered debt counsellor.

Interesting 2021 NCR statistics:

• Currently, 1 607 registered debt counsellors are active in South Africa. Remember, always verify a debt counsellor’s details on the NCR’s register of registrants first;
• There are four registered Payment Distribution Agents (PDAs) with the NCR. PDAs collect consumers’ monthly payment, distribute DC fees and pay creditors monthly;
• There are seven registered Alternative Dispute Resolution (ADR) registrants with the NCR. These agents offer mediation and various products to deal with issues around outstanding balances and disputes with creditors and paid-up debt being collected by debt collectors;
• There are 43 credit bureaux;
• There are 8 237 registered credit providers with 37 313 branches across South Africa;

What are the facts about debt review removals?

As to “debt review removals”, three High Court judges ruled that there are very specific circumstances in which consumers may be removed from debt review. This is contained in an official guideline issued by the National Credit Regulator.

Here are the debt review removal guidelines:

https://www.ncr.org.za/documents/27%20May%202021-Debt%20Withdrawal%20%20review.pdf

Only a registered debt counsellor can satisfy the requirements for a debt review removal inquiry and update the consumer’s status with the NCR. It’s in your best interest to make sure you are dealing with a legitimate person to give you the correct information regarding the debt review inquiry.

Recent NCR media release during March 2022:

A recent NCR media release warns consumers to be careful and aware of misleading advertising on social media platforms. Read the full media release here: https://www.ncr.org.za/index.php/latest-news/8-latest-news/127-misleading-advertising-on-social-media-platforms-regarding-debt-counselling

Debt counsellors and all other stakeholders are encouraged to post this NCR press release in the comments section of all false and misleading advertising to warn consumers and force the removal of these damaging posts.

Be part of the solution now.

Consumers and any other stakeholders are encouraged to report this type of advertising to the National Credit Regulator to be investigated. Complaints can be referred to complaints@ncr.org.za.

If you are a consumer who has been scammed, contact the NCR via their website to see if they can assist you. Stay safe and be vigilant! Your money, your responsibility!

In conclusion:

There is no easy solution when it comes to ridding yourself of debt. Misleading advertising is used as bait to lure struggling consumers into more hardship. Scammers offer false promises about reducing debt payments, consolidating debt, and exiting debt review with their “guaranteed” promises. The content of this journal covers everything you need to know about verifying who you are dealing with. If it is not a registered debt counsellor, walk away! The author Annienne Nel – NCRDC2452

*** Some of the content are extracted from the NCR misleading advertising media release ***