Friday, August 12, 2022

Sketchy TikTok ads tout high-interest payday loans

A group of secretive TikTok advertisers are using sketchy tactics to advance massive loans that experts say may violate deceptive advertising laws, The Post has learned.

Some ads tout “almost instant” five-digit deposits despite bad credit, while others imply that they are part of the government’s “inflation program” and use the logos of news organizations such as Nation World News.

Many ads ask cash-strapped borrowers who click on the link to have sensitive personal information, including their Social Security and bank account numbers.

“At best, these videos are designed to give you information you shouldn’t, which will result in more solicitations,” John Breuault, vice president of the National Consumer League’s advocacy group, told The Post. “At worst, it is an outright scam designed to either take your money or information for fraudulent purposes.”

A typical TikTok lending ad opens with a shot of the words “US Government Inflation Program 2022” on a video from the US Capitol.

Some of the advertisements appear to be part of the government’s “inflation programme”.

A voiceover in some broken English says, “The US government’s inflation program helps Americans get loans, even with bad credit.” “You can get up to $50,000 just by filling out a simple form.”

The ad then cuts to one shot from the perspective of a man holding a stack of hundred-dollar bills in a car.

Voiceover says, “I’m using my money to cover my bills, get some gas for the rest of the year, and meet my medical needs.” “Click on the link below, fill out the form in as little as 60 seconds and see how much you can get. Thank you later.”

Those who click the link, which leads to a site called “Lavish Finance,” are asked to fill out a form with personal information, including bank account details, Social Security numbers and addresses.

Lavish Finance says it then forwards applicants’ information to lenders, who can respond to loan offers with annual interest rates of up to 35.99% over a period of up to four years. If one were to take out a loan under the site’s maximum terms — $50,000 paid back over four years at a 35.99% APR — the user would eventually be on the hook for more than $137,000.

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tiktok logo
Experts say that the sketchy strategy of TikTok advertisers for giving massive loans could be do away with the deceptive advertising law.

Breyald said the loans advertised by Lavish Finance and similar sites are “terrible” for the vast majority of consumers.

“The 35.99% APR is higher than some of the highest credit card loans out there,” he said.

Breault and Bartlett Naylor, both a financial policy advocate with consumer rights group Public Citizen, said the ads run the risk of violating Federal Trade Commission rules on deceptive advertising.

@Loanssy TikTok ad for a loan
Other ads use the logos of news organizations such as Nation World News.

“If it’s implied that it’s a government program and you click on it and it’s not a government program, then my advice is: you’re being scammed,” Naylor said, advising people to “stay away.” Took a tough line against the individual for giving and calling on Tiktok. Loan Advertisement.

After TikTok was contacted by The Post for comment on ads from Lavish Finance and other companies, the social media site removed them for violating its advertising policies, which ban “misleading, unverified and deceptive behavior”.

A TikTok spokesperson told The Post, “Advertisers and advertising content must comply with our Community Guidelines, Advertising Guidelines and Terms of Service, and content that violates these guidelines will be removed.”

When Post emailed the only available email address on the Lavish Finance website for comment, the messages came back. A phone number listed on the site went straight to a voicemail box, which was full. The Lavish Finance site lists an address for a building in Dover, Del., that sells “virtual office services” for $50 per month.

The FTC said it does not comment on “whether it is investigating any specific company, individual or business practice.” The agency has not announced action against any of the sites in this article, but it often sues companies that the agency says are falsely claiming to be affiliated with the US government.

Lavish Finance is far from the only advertiser using questionable techniques on TikTok. An ad that links to a site called PersonalLoanPro shows what appears to be a fake Nation World News segment. It shows “breaking news” that “Americans can now claim up to $50,000.”

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“They’re showing it again,” says one man as he is showing the segment on a TV. “That’s how I got my money.”

The camera then spins across the man’s face as he says, “A new benefit was released last week, allowing Americans to claim up to $50,000. You don’t need any credit history – no bank requirement.” No. I did it myself and got $8,000 in two days.”

A similar Facebook version of the video was slapped with a “misinformation” warning in May — but as of mid-June, it was still being advertised on TikTok without any disclosure.

@Loanssy TikTok ad for a loan
Some loan sites ask people to enter sensitive information, including their Social Security number.

Other ads that link to PersonalLoanPro contain various narratives about receiving cash through the site. In one, the text “got $45,000 almost immediately” appears onscreen as a female narrator walks up to a man and says, “Babe, where did you get all that money from?”

The man shows an online banking account on his phone and says, “This is really crazy. I just got a loan of $45,000 and it’s already in our bank account.”

In another ad, a male narrator sitting in a car holds stacks of hundred-dollar bills and describes a loan as “the last-minute miracle I absolutely needed.”

Like Lavish Finances, PersonalLoanPro asks people to enter sensitive information, including their Social Security numbers. It says it will refer them to lenders who can offer them loans with interest rates of up to 35.99% APR over tenors of up to 15 years.

“Basically they say something like, ‘No one else knows about this, I wish I knew about this sooner’ — and they show you piles of cash,” Breuault said. “It’s laughable on its face, but it’s a common tactic.”

PersonalLoanPro’s site says it is owned by a Durango, Colo.-based company called On The Barrelhead. Email inquiries sent to both PersonalLoanPro and On The Barrelhead went unanswered, while calls from On The Barrelhead’s site to a phone number went straight to voicemail.

Nation World News Desk
Nation World News Desk
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