ILLEGAL moneylenders are adopting increasingly sophisticated methods to deceive borrowers by presenting loan agreements purportedly prepared by lawyers, creating the illusion of legitimacy while concealing unlicensed lending operations behind official-looking paperwork.
Anti-loan shark activist Azman Kang Abdullah said his organisation has received multiple complaints involving loan transactions supported by documents allegedly drafted by legal practitioners, leading borrowers to believe they were entering into lawful financial arrangements.
According to Azman, the agreements initially appear genuine and professionally prepared, causing victims to lower their guard. However, concerns emerge when borrowers who fail to meet repayment schedules begin receiving threats and intimidation commonly associated with illegal moneylending syndicates.
“Without doubt, these are loan sharks or individuals providing loans without the required licence.
“The agreement said to have been prepared by a lawyer would also become an invalid document because there are elements of threats and intimidation against victims, which are practices commonly carried out by loan sharks,” he said.
The latest case brought to his attention involved a businessman who allegedly borrowed more than RM4 million before finding himself subjected to aggressive collection tactics and mounting financial demands.
Azman said the borrower was required to sign documentation prepared by a lawyer and initially believed the transaction was legally valid.
“However, questions arise when he begins receiving threats and is required to repay as much as RM6 million. If it is a legitimate transaction, why is there a need for threats? This raises doubts about the status of the lender involved,” he said.
The case has intensified concerns that illegal lenders are exploiting legal-looking agreements as a new tool to gain the confidence of borrowers while masking unlawful lending activities.
Azman warned that such practices could leave victims trapped in a false sense of security, believing they are protected by legitimate contractual arrangements when, in reality, they may be dealing with unlicensed operators.
He urged enforcement authorities to investigate the matter thoroughly, warning that the tactic could become increasingly widespread if left unchecked.
According to him, previous investigations and complaints had revealed the involvement of individuals acting on behalf of syndicates to recover debts through intimidation, threats and the use of fraudulent legal documentation.
“They also prepare illegal loan agreements or disguise them as property sale and purchase agreements.
“Issues such as these can damage the credibility of legal practitioners because victims believe they are dealing with legitimate transactions, only to discover later that they have been deceived,” he said.
The revelations highlight growing concerns over the evolving tactics employed by illegal moneylending networks, which are increasingly blending elements of legal documentation with traditional intimidation methods to target borrowers and evade scrutiny from authorities. - June 6, 2026
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