THE Bangko Sentral ng Pilipinas (BSP) has cautioned the public against an increasingly prevalent auto loan “pasalo-benta” or assume balance scams.

In an advisory Wednesday, Sept. 29, 2021, it said perpetrators of the assume balance/pasalo scheme, also known as the pasalo-benta scheme, target vulnerable car buyers hoping to save money on their car purchase and sellers who need to transfer their liabilities.

Under this scheme, a syndicate member would buy a vehicle from a seller with an agreement to assume payments for the auto loan.

However, the syndicate member has no intention of paying the remaining amortizations and will sell/dispose of the vehicle to an end-buyer to gain profit using falsified documents, giving the end-buyer no rights over the vehicle. As a result, the original seller defaults on his/her auto loan and the car gets repossessed, leaving the end-buyer with nothing.

The BSP called on banks to prevent these crimes by reinforcing the conduct of customer identification and verification procedures as part of the customer due diligence. It also explained other types of car-related illegal activities including the rent-tangay, rent-sangla, loan accommodator scheme, and labas-casa scheme.

The BSP also advised banks to strictly observe and strengthen the implementation of Anti-Money Laundering (AML) regulations on customer identification and verification procedures, ongoing monitoring of customers and their transactions, suspicious transaction reporting, and continuing AML training program including controls relating to partner/accredited car dealers.

Banks are also reminded to file suspicious transaction reports, when warranted. (CSL)