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Police arrest 11 after Hong Kong loan companies found charging up to 90 per cent service fees
PUBLISHED : Thursday, 13 August, 2015, 12:01am
UPDATED : Thursday, 13 August, 2015, 12:01am
Samuel Chan
[email protected]
Police said the suspects may have duped more people. Photo: Edmund So
Police on Wednesday arrested 11 people running two financial consultancy companies which charged debtors a service fee as high as 90 per cent of the loan itself.
Among the nine men and two women arrested in the raid were the directors and staff of the two companies which had offices in Tsim Sha Tsui. Officers took computers and documents for further investigation.
The suspects, aged between 19 and 32, were arrested on suspicion of conspiracy to defraud.
Police said the two companies had cheated at least eight people out of HK$2.6 million, but they suspected there could be as many as 100 victims.
The eight people who filed reports to police all received "cold calls" between June last year and last month.
"It operates like telemarketing, cold calling, and [fraudsters] would ask people to go to their offices to borrow money, receive help with debt restructuring or to borrow money from banks," said Calvin Mohammed, chief police inspector from the crime unit of Yau Tsim district.
In one case, the victim agreed to use the consultancy's service to borrow HK$200,000, only to find out later that the handling charge amounted to HK$180,000.
On average, the two companies charged their clients 50 per cent of the loan amount as a handling fee.
Whether the debtor succeeded in getting a loan or not, police said the company would still charge clients "exorbitant" fees.
In cases of a similar nature in the past, criminals charged annual interest rates of up to 2,000 per cent. The highest legal rate is 60 per cent.
