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Monday, April 9, 2018

Project Funding Scams

There are many people on the internet who say they can help fund projects, but can they? Here we list some ways you can protect yourself against these fraudsters.

Know The Finance Industry


When you apply for any type of loan, it can be hard to tell if the business offering project funding is a scam. It is important to work with lenders who have a history of funding projects. Whilst some funding coporations may not list whom their clients are for confidentiality reasons, there are ways you can check to see if they can be trusted with your money.


  • How well known are they?
  • Are they licensed/registered with a financial authority?
  • Listed on BBB/trusted websites
  • Main lenders or independent brokerage
If you are looking for International finance, there seems to be many businesses worldwide who provide this service. This is where we ask to yo take extreme caution. Many of these businesses are bogus and are only set up to take upfront fees. Some unscrupolous individuals have learned that it's easy to take advantage of people offering finance worldwide to desperate entrepreneurs.

Funder Scams

Taking on board the bullet points above, other points you can use to protect yourself when someone says they are a financial provider is:
  • Are they listed on a complaints/scam website?
  • What are their terms and conditions?
  • Where are they operating from? Are they incorporated there?
  • Where did you see their business advertised? In a search engine or forum?
  • What's the fee status and APR
  • Are they exposed on social media/ networking platforms or hidden entity?
  • Are they knowledgable in finance?
We have seen some very sophisticated scams on the internet. Scammers can go as far as passing themselves off as someone else. If you have an concerns with a business that say they are the lender. Do all the research you can about them first, don't just jump right in an believe they can help. Get to know the people behind the company.

Intermediary Businesses In Finance

The most common way is for individuals setting themselves up as intermediary businesses:
  • Do they exist on LinkedIn with Personal recommendations? 
  • Are they a well known company?
  • Does the business have a professional website?
  • Are they a registered business entity?
  • Do they use a business email?

Information People Provide Online


Emails
If you are applying for finance, one thing to question is the use of business or personal emails. Would you rather correspond to someone using:

joebloggs@gmail.com, prestigeintermediaries@gmail.com
or info@prestigeintermediaries.com 

Check where the email is being sent from vs where they say they are located? We often catch out service providers who's website says their office is based in one country yet their emails derive from another country. This can often be a red flag and a sign that the so called 'company' is just posing as a legitimate company.


One could argue whether there is a reason to conduct financial transactions using a personal email address for business reasons? 

Websites 
If they have conducted business in finance before, why haven't they got a website? (Watch out for the "free self build websites so commonly used such as WIX, Weebly or similar) Is the address on the website pointing to a home address or business? Are the intermediaries/funders exposed on the internet? eg do they seem established and open? Are they forthcoming with information? Do they have a willingness to help you or do they seem only to want money from you?


Knowledge In The Field
Do they understand the workings behind funding a project? Knowledge of finance is integral to the funding business. If the person is soliciting financial services to you, how much do they know about funding projects?
 
If you are applying through an intermediary firm, one important tip we want you to know is that they should not handle client money! They should only receive money upon successful placement.If the intermediary is asking for a fee for their service, stay away!