Mexican loan apps lure young people into extortion and fraud

Unemployed and tempted by the above-average salary, Karen applied to work at a call centre for Mexican loan app CashBox — unaware that her job would be to threaten and intimidate anyone who failed to pay up on time.

In the five days she lasted in the job, bosses ordered her to harass clients as soon as they missed a repayment by mining their contact lists, text messages and pictures, to which the app had access — in violation of Mexico's privacy law.

“Many of us in the call centre were scared and didn’t even know if what we were doing was legal,” Karen, 28,  told the Thomson Reuters Foundation, asking to use a pseudonym for fear of reprisals.

“They take advantage of people in need of a job,” she said. Workers are routinely bullied by supervisors, made to work unpaid overtime and given no proper job contracts.

CashBox did not respond to requests for comment.

In August, the Thomson Reuters Foundation found that it was among 29 loan apps with millions of downloads in the Google Play Store that have been reported to authorities for unscrupulous lending practices such as sky-high interest rates and commissions and illegal debt-collection tactics.

These ranged from threatening phone calls and text messages to distributing among client’s contacts photographs edited into explicit images.

In August, Mexico City police raided seven call centres that served more than 90 loan apps including CashBox, making 27 arrests and seizing hundreds of phones, computers and SIM cards used for customer extortion.

After the raids, the capital’s mayor Claudia Sheinbaum urged job seekers to shun the scam call centres, saying “it’s a crime to participate in any sort of extortion”.

Workers who had to carry out the apps’ heavy-handed tactics are mostly young people drawn into the call centres because they have few employment options, said four former employees.

Six out of 10 Mexicans aged 15 to 25 are jobless while half of those in the labour force earn the minimum wage, forcing many to take whatever job they can find, according to a recent report from think-tank IMCO.

Abuse on WhatsApp

After Karen lost a job in construction shortly before the start of the Covid-19 pandemic, her friend suggested the CashBox call centre, which was looking for debt-collection agents.

The day she went for the interview, Karen was told she was hired and could start working, but she was not given a contract.

“It struck me as very odd right away. They didn’t even ask for my ID or tax information,” said Karen, who dropped out of law school for lack of money and has been doing odd jobs since.

As soon as she started work, she was told to watch how her co-workers verbally abused clients in WhatsApp calls.

“The supervisor would tell us to intimidate the clients by saying we'd go looking for them to beat them up, or that something very bad would happen to them,” she recalled.

The Thomson Reuters Foundation investigation showed borrowers granted the apps permission to access personal information on their phones due to unclear privacy policies, many of which breach Mexican legislation.

Police said that in August they received more than 15,000 complaints related to 679 fraudulent loan apps and websites operating in Mexico, of which 311 are still active. Many complaints related to use of personal data.

CashBox is still available on the Google Play Store, with more than a million downloads.

Dropouts

Recruiters for the loan apps being investigated by Mexican police advertise “phone executive” roles on Facebook for high-school dropouts or people with middle-school education. The Facebook groups have tens of thousands of members.

The roles, open to anyone aged 18 to 40, offer immediate hiring and monthly pay of more than 6,000 Mexican pesos (about $300), about 2,000 pesos more than Mexico’s minimum wage.

But former call centre collection agents said they received no formal employment benefits such as social security, were usually paid in cash and had harsh working conditions.

“The office was horrible, with improvised wooden tables and no computers to work on. Everything was done from our own cellphones,” said Enrique Hernández, 30, who has worked in three call centres since September 2021.

“It made me uncomfortable to use my phone number, so I brought another phone I rarely used,” he said. He needed the job to fund his studies.

Agents were forced to use their personal phones to edit client photographs and add captions such as “Wanted for paedophilia”, threatening to send the doctored images to close contacts to pressure them into paying.

“We specifically targeted contact names like Mom, Dad or Baby,” said Hernández.

In December 2021, Hernández found a new job in another scam call centre that collected money for loan apps Me Préstamos, Súper Préstamo, and Súper Pago, all of them reported for extortion and fraud.

None of the apps are still active on the Google Play Store, and no contact information can be found.

Karen and Hernández said they left their jobs due to the labour irregularities and worries about the legality of what they were doing. Both now work in formal call centres serving banks.

“It’s a bad way to earn easy money,” said Karen of the loan app call centres. “I wouldn’t advise anybody to do it.”

Thomson Reuters Foundation