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Internet Lending and Financing Terrorism – Is there any connection?

Lending Times Daily News analysis and data for p2p and marketplace lending

 

Authorities have now learned that a deposit of $28,500 was made to the bank account of Syed Farook (the San Bernardino terrorist) two weeks before the tragic shootings. The deposit came from WebBank.com – an internet lending operation. It has been suggested that this deposit was a loan arranged by Prosper Marketplace Inc and then issued by WebBank – a Utah based lender. This assumption has not been confirmed – and other explanations could be possible – such as the deposit being a transfer directed by someone else.

Believing that this $28,500 deposit was the result of a loan obtained online has caused the fear mongers to already be decrying the internet lenders and the scary outcomes that could be possible. Those that seek internet lenders do so because they are typically faster to process and also open up possibilities to younger people with shorter credit histories who would have a more difficult time with traditional bank loans. Some offer different interest rates based on the amount of information that is provided – and whether parents or others could participate as a backer of the loan. This opens up a new world to milllenials who might otherwise be frozen out of the market.

These loans are not faster because of less due diligence or vetting performed, but because of a more efficient vetting process and 21st century technology. Internet lenders (such as Prosper – and their collaboration with WebBank) have very strong ordinances for KYC (Know Your Customer) and Anti MoneyLaundering. They use their own research tools, have sophisticated fact-finding procedures and follow all regulations and guidelines. These lenders are certainly astute enough to carefully scrutinize all clients as they try to grow their operations and become respected entities with sterling reputations.

If it is confirmed that Syed Farook was actually granted a loan from WebBank, we must assume that he raised no red flags and passed all careful scrutiny – just as he raised no red flags with the FBI, Homeland Security, US Customs, US Immigration or any other national or international agency. Sometimes people are able to operate under the radar and do slip through the cracks as Farook and his wife apparently did. Our most elite agencies had no idea of their intentions, so Prosper or WebBank could never have been expected to predict their awful intentions.

Even if WebBank issued this loan to Farook as alleged, we can never really know what the money was to be used for. It has been suggested that the money was to be used for the benefit of Farook’s child. But, in another vein, what could we learn from this apparent use of internet lenders to finance terrorism – if this is truly what it was? Moving forward, any agency that has any information about possible terrorists – should share this information with lending institutions (internet based or otherwise) just as they share it with airlines to create “no-fly” lists. If internet lenders had access to a “no-lend” list, we could prevent any use of internet lending to potentially finance any act of terrorism.

All of our caution notwithstanding, America can never be a country that denies a loan to anyone based on their religion, the color of their skin or how you pronounce their last name.

Author : Linda Melchione

About the author

George Popescu

Serial entrepreneur.

George sold and exited his most successful company, Boston Technologies (BT) group, in 2014. BT was a technology, market maker, high-frequency trading and inter-broker broker-dealer in the FX Spot, precious metals and CFDs space company. George was the Founder and CEO and he boot-strapped from $0 to a $20+ million in revenue without any equity investment. BT has been #1 fastest growing company in Boston in 2011 according to the Boston Business Journal and the only company being in top 10 fastest in 2012-13 as it was #5 in 2012. BT has been on the Inc. 500/5000 list of fastest growing companies in the US for 4 years in a row ( #143, #373, #897 and #1270). After the company sale in July 2014 until February 2015 George was Head-of-Strategy for Currency Mountain ( www.currencymountain.com ), a USD 100 million+ holding company focused on retail and medium institutional currencies, precious metals, stocks, fixed income and commodities businesses.

• Over the last 10 years, George founded 10 companies in online lending, craft beer brewery, exotic sports car rental space, hedge funds, peer-reviewed scientific journal ( Journal of Cellular and Molecular medicine…) and more. George advised 30+ early stage start-ups in different fields. George was also a mentor at MIT’s Venture Mentoring Services and Techstar Fintech in NY.

• Previously George obtained 3 Master's Degrees: a Master's of Science from MIT working on 3D printing, a Master’s in Electrical Engineering and Computer Science from Supelec, France and a Master's in Nanosciences from Paris XI University. Previously he worked as a visiting scientist at MIT in Bio-engineering for 2 years. George had 3 undergrad majors: Maths, Physics and Chemistry. His scientific career led to about 10 publications and patents.

• On the business side, Boston Business Journal has named me in the top 40 under 40 in 2012 in recognition of his business achievements.

• George is originally from Romania and grew up in Paris, France.

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