SECP Warns Against Fraudsters Using Social Media For ‘Interest-Free’ Loan Scams

The Securities and Exchange Commission of Pakistan (SECP) continues vigilant monitoring of social media platforms to safeguard the public from falling victim to illegal and exploitative personal loan schemes. Following the successful crackdown on 141 unauthorized digital lending apps through the coordinated efforts of relevant stakeholders, operators behind such schemes have now resorted to alternative channels, primarily social media, to continue their fraudulent activities. The SECP has observed sponsored advertisements on platforms such as Facebook, falsely offering quick, interest-free loans with minimal requirements. The names of reputable organizations are being fraudulently cited in these promotions to falsely project legitimacy and gain public trust. These advertisements are being used to lure unsuspecting individuals into paying upfront charges under the guise of processing, registration, insurance, or account verification fees, or into sharing sensitive personal information. Once the payment or information is obtained, the scammers disappear without disbursing any loan.