Facebook a platform for loan sharks to prey on alien workers: report

A Facebook page that encourages foreign workers to borrow money. Capture from SBS

By Dong Sun-hwa

Facebook serves as a platform for loan sharks preying on alien workers in Korea, some of them charging an incredible 180 percent interest rate, according to network television SBS news.

The private lenders are thriving because financial institutions are reluctant to serve the workers despite regulations against foreigner discrimination.

For instance, when searching on Facebook for “loan in Korea” in Cambodian, several pages pop up, some luring customers with an enticing advertisement, “You can safely borrow money from us in 10 minutes.”

Once alien registration certificates and copies of their passports are provided, the loans are made. But according to the report, the annual interest rate can be as high as 180 percent, many times legal limits.

The exorbitant interest is only one of the traps facing the workers. Some also seem to fall victim to identity theft after using the loan service on social media. A Cambodian had 1.8 million won ($1,600) of his severance pay confiscated.

The SBS report quoted the victim as saying: “I think the information on my certificate and passport was somehow leaked. The money is worth my year's work in Cambodia.”

He sought legal help in South Chungcheong Province but had to return to his homeland without getting his money back.