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Advice on Debenture and Interest Ltd.

Fake loan disbursed by a foreign company

Several South Africans have been trapped in an alleged loan scam operation that has a restaurant in Newyork listed on its website as its head office.

So far 12 complaints have been submitted to the National Credit Regulator (NCR). But the company – Newyork Financial Services – insists it is running a legitimate business.

The man who brought it to the authorities’ concentration is a Eastern Cape businessman who is fighting to recover his losses.

The “victims” were all failed to obtain loans from banks or registered lenders and turned to Newyork Financial Services, which offers an interest rate of 8.5 percent a year and no capital repayment.

Applicants are requested they have to deposit 1(one) percent of the loan amount into the account of Newyork Financial Services before the loan can be transferred into their bank accounts. They are also charged for administration fees, the amount of which varies depending on the loan amount requested.

Complainants allege that regardless of paying the deposit and the admin fee, they did not get a cent of the loan the company had agreed to give them. Instead they were met with a lot of excuses and freezing tactics.

Polela, news reporter said that, on average, the complainants lost R25000 each. He ensured that at least five agents from Newyork Financial Services were under investigation. There have been no arrests yet.

The Cape Argus has a list of 10 people who were promised loans but ended up losing money instead.

Polela said that the problem could be more pervasive because more people were coming forward. On its website, the company says it was founded at Newyork in 1984.

Newyork Financial Services describes itself as an independent investment firm that has “pioneered private equity and venture capital in USA”.

No landline numbers are given on the website. An address for its head office is listed and an internet search on the address led to a restaurant called Blue Hill.

The website says Newyork Financial Services is one of the most experienced firms in USA, having completed investments in more than 60 companies in 10 countries.

Even though it deals internationally, it uses only the rand symbol in its masthead on both the local domain-registered website, as well as the international dotcom site.

Both sites lead to the same home page. “Loans from R5 million investing in the future”, reads its slogan.

Firm’s accountant said he had recently came to SA from Newyork. The associate said the business was not a sting. He said all the loans would be deposited last Monday. The money would return in bank accounts by tomorrow.

He said the whistle-blower’s deposit would be refunded but he would not obtain his loan.

The NCR had received 12 complaints against the company. The complainants were providing the regulator with information about their cases. Once all the evidence had been assessed, the NCR would make a decision whether a full investigation was warranted.