August 9, 2013

Loans available at 3 % p.a in India fraud

Before you read further, please AVOID talking to anybody advertising such loans.

Hope the catchy title got your attention. Really? Can you get a loan at 3 % per annum?! Hope you're not kidding me. How is that possible? Is RBI your baap? Or is Sonia Gandhi your maa?

Oh, it's because the loan providers who advertise in the papers (mostly Times of India) are able to get funds from the US at 1-2 %. You see, these people are the ones that fund the US govt. They have so much money, they don't know what to do with it. That is why they are willing to accept such low returns on their investments.
So was looking through the paper to find out what kind of requirements does one have for business loans.
Deccan Herald- Sunday Aug 4, Classifieds, page 4.
Came across this gem

So I called the first number and a gentleman by the name of Mr Kunal Sriwastav answered my call (or rather prayers :) )

I gave him some details and after the initial conversation, he mentions that they give loans at 3 % p.a. I'm like you mean 3 % per month, right? He says no. 3 % p.a. I'm not able to figure it out (also, the voice was not clear on the mobile.)
Still not getting it, I ask him to repeat month or annum. I then ask him, please do not mind my curiosity but pray, where do you obtain funds at such a low rate from? Reply, the US. I'm like bhai, I understand the interest rates are 1-4 % there but when did you become Warren Buffett or P & G or the Fed Reserve that generous you are offering us credit starved Indians such a good deal?

He replies, our boss is based in the US and after getting loans there, he thought Indians should have this opportunity too. (How sweet of him.)

So incredulous at this point that if something is too good to be true, then it might not be true, I call him from another number and try to clarify matters a bit more. Same reply, 3 % p.a sir. And we do business all over AP and TN, Guntur, Nellore, Vizag, Vishakapatnam, Madras, Salem blah blah.

I ask them where they are based, he replies, Andheri, Bombay(but the mobile trace of this Kunal's number is from Delhi.)

So I try looking up the company, no sign of it there. He tells me to send him an email with the requirement, so after talking to him, I send him an email. After 20min, I get 2 calls from him but I don't pick it up. At this point, I am quite keen to dig deeper and see what's behind all this.

Googling for "loans at 3 p.a india fraud" leads me to the consumer court website.

So this is what is the bigger picture. This is very profitable racket these guys are running there. Our version of the Nigerian 491 scams.

These guys are running a fraud scheme on a big scale(for small fish). And others are jumping into the fray so as to make quick profits(please see ads below.)

How do they not get caught?
They are all based in the NCR(national capital region) but advertise in far away cities like Pune, Bangalore, Madras and smaller towns and cities so that the victims who are dire financial need not come to pursue this case in the NCR due to lack of knowledge and time.

They use mobile numbers that they dispose after one fraud(10k-1.5Lakh) and borrowed or colluded bank accounts. They have valid bank accounts but nobody cares pursuing this.

How can one catch these bastards? 
Simple, file an FIR with the local police station.
For all the mobile numbers, get registration details. Get call records and sms'. This will be provided to you by the police station.

After filing the FIR with the police station, please approach the local branch of the bank that you deposited the money in. They will give you a copy of the bank statements for the past 12 months and registration details of the people/company.

Once you get these details, you have to pursue these people on their own(I doubt the local police is interested in small frauds like this.)

You could find more ads like the one below by going to

and type in "loans 3" in the search box. A number of results come up with many of them offering you 1 lakh a month as commission for being an agent.

To see archive of such ads, you can go back and search through TOI's epaper archives.

Loans at 3 % p.a fraud listings