Taking Out a Loan With No Intention of Paying
This written piece could also be entitled, “Doing a Runner On Owing Money”
And also, “How We Commit Loan Fraud”.
You should be, as there are things we do that in the eyes of a bank or lender, could be viewed as loan fraud.
But first, here is a question I have been asked many times over the years:
Can I Take Out a Loan and Then Just Do a Runner to Another Country and Never Pay the Loan Back?
The answer: Sure you can, but it is not that simple.
First you need to be approved for the loan. Which usually means you have a job here in the UK, you live here, may have family here, bank here, and are fairly established here in the UK.
So do you get the loan and then run off?
How much of a loan is worth packing your life up and just moving on?
Then the follow-up questions are, will the bank chase me for payment, and how would they find me?
The wheels grind slowly, buy yet they grind.
If you move to the EU there are for now, laws allowing cross-country collections. If you were to moved outside of the UK and EU, the collection process gets more complicated.
Accounts/debts get sold onto collection agencies around the world all the time, which they can then be collected in that country. So you really have not skipped out on anything.
In addition, just because you have left the country doesn’t mean the debt is no longer owed. Should you return to the UK, the collection process can start all over again.
Then the question, can I return to the UK owing money in the UK.
Yes, you can return to the UK owing money, as long as no criminal charges have been brought against you.
Technically taking out a loan with no intention of repaying it, is not in the true sense fraud. It is also not criminal, it is ethically wrong, and some may debate morally wrong, but not a crime. At the time the bank approved the loan, you were loan worthy.
Now the question, but how will my creditors find me should I do a runner?
They may not find you, but in this “ever changing world we live in” as per Sr Paul, there are ways. Many collectors use social media to find debtors; things like Facebook, Twitter, etc. You’d be surprised how you can be found.
A bit scary isn’t it, “Big Brother is Watching”!
So why go through all that in the first place. Take out a loan and pack up and go. It would need to be a big loan to make life worth living somewhere else.
But lets’ look at some real ways people fraud a bank or lender.
The old inflating income trick. The bank asks how much you earn and you bump it up a few grand a year.
Simple enough, until the bank asks for wage slips, bank statements, etc, and they may. However, they may not.
If they do, there are those that make changes on these statements when they copy them, and that my friend is true fraud.
Now one could argue if the lender does not follow through with due diligence and request actual statements, they are at fault and a party to the fraud, but you would be wrong.
Inflating income is a big way people commit fraud for loans.
Will they go to jail if caught? Probably not, these are small offences and not worthy of the court’s time. However, larger fraud cases may be.
Using someone’s else’s identity is fraud as well. In addition to being ID theft.
As many application for loans are done online, the lender may never actually see the borrower. It is all done online, via credit scores and the such, so you just use someone else’s name and address, and your bank account details.
This also ties in with creating false credit reports. This is difficult to do, but it can be done, and there are companies offering fresh starts by creating new credit histories for you. Still a bit of fraud.
Not Disclosing Facts
Here is a bit of a grey area, the non-disclosure of some facts.
You may be asked a question on a loan application form asking if you have ever been bankrupt. You answer no, but perhaps you were bankrupt but in another country.
The loan application is quite broad, it is not specifically asking, have you ever been bankrupt in the UK, but you make the assumption that is what they are asking.
Technically that is non-disclosure, which can be considered a form of fraud if found out.
How will “they” find out you ask again, they have their ways. But again, they may never find out.
This is not the only way people can commit fraud on applying for a loan, and people do forget and make mistakes when completing loan applications, these are mistakes and not meant to be fraudulent.