Borrower who was hit with 72 per cent service charge on US$32,000 loan among victims of unscrupulous money lending practices in Hong Kong
- Intermediary said a loan had been arranged but a service fee of HK$180,000 would be charged, leaving just HK$70,000 for the borrower
- Hong Kong’s consumer watchdog releases study on borrowing with an analysis of more than 300 complaints against money lenders
A Hong Kong borrower secured a loan of HK$250,000 (US$32,000) from money lenders only to be told later that more than 70 per cent was to be deducted as a service charge.
The complainant, dubbed “C”, received a call from a man who claimed to be a “bank employee” and was then introduced to an intermediary, who asked him to sign an agreement for arranging loans with money lenders.
Later, the intermediary told C that a loan of HK$250,000 had been arranged but a service fee of HK$180,000 (US$23,000) would be charged, leaving just HK$70,000 (US$9,000), or 28 per cent of the money, for the complainant.
C refused and was then threatened by the pair.
In another case, a complainant signed an agreement with a financial intermediary, allowing it to arrange a HK$130,000 loan from another money lender to pay off debts and filing fees for a bankruptcy petition.
