POLICE have warned of an ‘emerging fraud’ as an East Lancashire man said he was duped into paying cash upfront after applying for a loan.

Raymond Ince, 40, of Wytham Street, Padiham, lost £350 in an ‘advance fee fraud’.

A police spokesman said the scam was increasing, with 46 cases reported in the Lancashire force area last month. Part-time lollipop man Mr Ince wanted to borrow £1,500 to move house with his wife and two children. He searched the internet and asked North Yorkshire-based Loan Solutions to arrange the money.

The loan-broking firm warns applicants on its website to ignore telephone requests from anyone purporting to represent the company asking for cash to be paid up front ‘by Ukash or Western Union’.

Mr Ince received a call from a Glasgow number a few weeks later asking for £50 to finalise the loan by Ukash.

He paid and received a series of follow-up requests, paying a total of £350 but never receiving the loan.

He called the Glasgow number to complain, was asked for more money and then rang Loan Solutions to be told the calls were from scammers.

Mr Ince, who reported the case to the police, said: “I have been very naive and have lost £350 I cannot afford.

“I have been duped into paying money up front that I cannot get back.

“I can just warn other people not to do the same.

“I don’t know who the people in Glasgow were and how they got my number. They seemed to have a lot of detail about my application and were very persuasive.”

Detective Constable Scott Griffin, of Lancashire police’s Economic Crime Unit, said victims who searched the internet for loans were called by people purporting to be from a loan company advising their request was successful.

They are told before funds can be transferred, the ‘loan company’ requires an arrangement fee first. Then further high pressure calls are made requesting more money. No loan is ever received.

DC Griffin said: “I would advise anyone applying for a loan in these circumstances to stop and think — especially if a company asks you to provide money up front.

“Be especially cautious if asked to send money by money transfer providers.”

Julie Waddington, of Lancashire Trading Standards, said: “People need to beware of the danger of scammers posing as an existing legitimate company.

“It’s a common scam to ask for some form of payment in advance, with the payment being taken but nothing provided.

“It’s often applied to receiving a loan.

"Alarm bells should start ringing if anyone asks you to pay by giving them the details of a Ukash voucher over the phone."

Alex Lawton, a team leader at Loan Solutions in Yorkshire confirmed the company received a loan application from Mr Ince but ‘ nothing had been finalised’.

He said: “The people in Glasgow are nothing to do with us.

“These scammers use our name and make cold calls to people who have used loan comparison websites.

“The company tries to get people like this closed down.

“We have a warning on our website about paying money up front.”