Unscrupulous lenders are taking advantage of seniors with offers of pension advances in which borrowers sign over part or all of their pension payments in exchange for cash.

The lenders aren't making clear that these pension advances are loans – loans that carry interest rates of 27 to 106 percent, according to a review by The New York Times of more than 24 contracts for pension-based loans.

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Just to qualify for the loans, borrowers sometimes have to purchase a life-insurance policy
designating the lender as the sole beneficiary. Seniors face a loss of their retirement savings and a plunge into high-cost debt, The Times reports.

The lenders are particularly targeting people with public pensions — military veterans, teachers, firefighters and police officers, for example.

The pension-advance companies generally aren't subject to state and federal banking regulations, but Congress and the Consumer Financial Protection Bureau are starting to pay attention, according to The Times.

The paper couldn't determine how many financially struggling people have opted for pension loans. But legal aid offices in Arizona, California, Florida and New York report a rush of complaints from retirees who are in trouble because of the loans.

Editor’s Note: Put the World’s Top Financial Minds to Work for You