​Loan scam rackets can bring in millions nationwide in a very short time. Unsuspecting people send in a fee in return for a promised loan. Because interested individuals are often in debt trouble, the loss of the fee through this fraud is especially devastating.​

Typically, advertisers place a three to four line in-column classified or late-night broadcast ad offering personal or debt consolidation loans. Amounts of potential loans are often included. Rarely is a company name or street address location given, ​but there is either a toll-free or a 900 toll number provided.

When a citizen does call, a minimal amount of information is asked for. Then, a so-called "approval call-back" is made to the consumer. Virtually everyone is "approved". Telephone operators are trained to say they are not the actual lender. They claim instead to have located a lender who will work with the borrower. The citizen is then asked to send a fee, often by overnight mail, or by courier to avoid federal mail fraud prosecution. They are also asked to send other information such as a copy of their driver's license, a copy of their last pay stub, a copy of their social security card, etc.

If pressed, such firms often say they are licensed (even if they are not). They may have a legitimate-sounding answer to almost any question.