Man Goes to Prison for Payday Loan Scheme
A crime of a different color
Most of the payday loan related crimes I write about involve petty thieves pointing guns in people’s faces and taking off with a bunch of cash. Today, however, I came across a payday loan crime of a different type.
From the Baltimore Business Journal:
Alvin Allister Ambrose, 37, formerly of Broadwater Road in Clarksville, was sentenced by Howard County Circuit Court Judge Timothy J. McCrone to eight years in prison, with all but six months suspended, and ordered to pay $602,790 to investors.
Ambrose was convicted on June 28 on charges stemming from his misuse of $5.04 million in funds invested by more than 180 investors to provide payday loans to clients of Ambrose’s cash-advance business with a promised high rate of return to investors, the Attorney General’s office said. The state’s investigation determined that, of that amount, Ambrose invested only $261,932 in payday loans, the Attorney General’s Office said.
Prison for payday loan fraud
Ambrose was charged with “fraudulent misappropriation by a fiduciary.” I wonder how long it will take him to pay back the $602,790? It’s odd to me that he was sentenced to eight years in prison but will really only go there for six months, but this type of thing happens all the time so I guess the justice system knows what it’s doing.
This just highlights the fact that there are a whole lot of scammers out there. Sometimes it doesn’t matter how well you research a person before letting them handle your money, but it never hurts to thoroughly check out a business, individual securities broker or anyone else who you’re allowing to invest your money.
Federal Trade Commission cracks down
Last month, the FTC once again announced it would strengthen its efforts to reduce fraud and scamming. The FTC web site says:
The Federal Trade Commission today announced a law enforcement crackdown on scammers trying to take advantage of the economic downturn to bilk vulnerable consumers through a variety of schemes, such as promising non-existent jobs; promoting overhyped get-rich-quick plans, bogus government grants, and phony debt-reduction services; or putting unauthorized charges on consumers’ credit or debit cards.
Phony debt reduction and unauthorized charges? Pretty scary stuff.
Debt consolidation scams
Often the debt consolidation scammers pretend that they’re a debt consolidator and tell you they’ll give you a loan which will pay off all of your debts, and then you can just pay back the loan.
However, what often happens is that the fake debt counselor will collect a big chunk of money as a down payment for the loan and then just disappear, leaving your debt fully intact.
Do your homework
I know I already said this, but make you you do careful research when selecting a financial expert for any reasons. Scammers have also posed as fake mortgage modification companies.
Alvin Allister Ambrose isn’t the first person to lie about what he is doing with people’s money, and he won’t be the last.