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Don't Get Scammed

Borrowing money? Watch for online scams.

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This story appears in the December 2008 issue of Entrepreneur. Subscribe »

You know it's wrong, but you can't stop yourself. You've been eyeing those business loan offers with piqued interest lately, positive that a couple of the professional-looking sites must be legit. Watch out: Looks can be deceiving. Websites that appear to be for established financial institutions--complete with flashy graphics and photos--may promise a quick application process and easy loan approvals only to disappear a few weeks later.

In April, the Better Business Bureau reported a spike in the number of complaints about advance-fee loan scams. Many of the hundreds of phony web-based lending organizations that the BBB has received complaints about this year have official-sounding names, such as Central Financial or Corporate Bankers of . Their websites promise easy business or consumer loans, but often require an upfront fee to process the loan application, which could be as high as a whopping $26,000, says Alison Preszler, media relations manager with the BBB. Customers report that the "banks" then vanish, taking their fees with them.

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