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Advance Fee Scheme! How To Avoid Falling Victim To This Fraud! What Is an Advance Fee Scam?

Updated on May 1, 2012

What is an Advance Fee Scheme?

An Advance Fee Scheme happens when a victim pays money to somebody with an expectation of acquiring something of much greater value. This could be in the form of a loan, a contract, or a gift. Once the money is paid the victim obtains nothing of value in return.

The diversity of Advance Fee schemes can be as imaginative as the con artist is able to think of enacting.

It might comprise the sale of products or services. It might be an offer of investment or even lottery winnings, any other found money or various other opportunities.

There are con artists that will offer to provide the victim with some sort of financing if the victim pays the finders fee in advance.

They will compel the victim to sign contracts agreeing to pay the fee once the victim has been introduced to a source of financing.

The victim learns after the fact that they are indeed ineligible to attain financing. This is only disclosed once the finder's fee has been paid according to the signed contract.

These agreements may even be considered legal. It can only be shown to be illegal if it can be proven that the finder never had an intention or an ability to supply any financing for the vicitim.


Some ways to avoid falling victim to Advanced Fee Schemes

If you receive an offer that seems so good it could not be true, you are more then likely correct. Follow the proper procedures for conducting business.

A legitimate business does not run a cash only business on a street corner. Use common sense!

Always be aware of who you are conducting business with, if you have never heard of either the person or the company that you are thinking of doing business with, investigate and find out more about them first.

Subject to the amount of money that you are considering spending, you may wish to visit the location of the business itself. You can check with your local Better Business Bureau, or inquire with the bank you conduct your business with. Call your attorney, or even contact your local law enforcement first.

Advance Fee Loan Scams

Before you enter into any business arrangement, be sure you understand all aspects of the agreement you are entering into.

If you are unable to understand the terms of the contract , have them evaluated by a knowledgeable attorney.

If a business does not have an actual street address but operates through Post Office boxes or mail drops, this is a sign to be cautious.

If the person you are attempting to conduct transactions with does not have a direct phone line, is never available when you call, but never fails to make a return call to you later. Beware!

Be suspicious if part of your business dealings entails you signing a nondisclosure or non-circumvention agreements. These documents are constructed to prevent you from freely validating the legitimacy of the people who you are preparing to conduct business.

Con artists will use these non-circumvention agreements to attempt to make threats to their victims with a Civil Suit if the victim reports them to Law Enforcement Agencies.


Always be aware of the people you are prepared to do business with.

Do not feel that you would be betraying their trust by looking into the legitimacy of their business.

Any legitimate business would be more then happy to provide you with as much information pertaining to their company that you would request.

Be Aware, and Be Cautious!


The materials available on this hub are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. All materiel are copyrighted properties of the author and may not be used without permission of the author.

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