By Sarah E. Needleman and Ruth Simon Tisto Chapman, an owner of a Powerhouse Gym in Burbank, Calif., said that in August he paid a St. Louis broker thousands of dollars to help him obtain a bank loan to upgrade his facilities and refinance debt. It seemed like a no-lose proposition, in part because the broker, Richard Saddler, promised to refund him the $12,500 fee if the loan didn't materialize, Mr. Chapman said. In the next month and a half, Mr. Saddler repeatedly reassured Mr. Chapman that the loan was being processed, according to the gym owner. But in the following month, he tried to contact Mr. Saddler more than a dozen times by phone and email, he said, and never heard back.Mr. Chapman later learned that Mr. Saddler had been indicted on three counts of wire fraud. Mr. Saddler pleaded guilty in March and is scheduled to be sentenced July 1. He declined to comment for this article.The scam that Mr. Chapman said he was victimized by is common, government officials said, adding they have been receiving more complaints about such crimes in recent years. "Advance-fee loan schemes," as the swindle is known, have been around for years. Self-described loan brokers demand upfront payments for loans that never materialize.But the scam has intensified since the financial crisis, as banks tightened lending standards, making it more difficult for small businesses to obtain financing.In 2013, there were a record 53,833 complaints about advance-fee loans and credit arrangers filed by entrepreneurs and consumers to the Federal Trade Commission, up from 43,070 in 2012 and 44,504 in 2011, according to the government agency. Most of the complaints have to do with loans that never arrived despite the payment of upfront fees, according to a Wall Street Journal review of the FTC data. A spokeswoman for the FTC said its year-by-year count increased partly because it expanded the number of external civil and criminal law-enforcement agencies from which it collects complaints. "We continue to see suspicious-activity reports on variations of advance-fee schemes," said Steve Hudak, a spokesman for the Financial Crimes Enforcement Network, a bureau within the U.S. Treasury Department.Robert Kynoch, chief of financial investigations at the Florida Office of Financial Regulation, said that his staff is investigating 15 advance-fee schemes targeting small businesses.Florida opened 21 advance-fee investigations involving businesses or consumers in 2013, up from seven in 2012, and an additional 10 cases so far this year. In one case that resulted in a guilty plea last year, a small-business owner paid $55,000 to try to secure a $10 million loan.Entrepreneurs tend to get duped by advance-fee scams because they are confident in their ideas and can overlook some of the red flags that should scare them off, according to consultants and white-collar-crime lawyers.Some small-business owners are targeted via email, while others become victims when they look online for lenders after being turned down for conventional financing."The vast majority of people who pay the advance fees to these unregistered entities do not receive a loan," Florida's Mr. Kynoch said.Businesses with $1 million to $50 million in revenue are the most common targets, according to Alabama Securities Director Joseph Borg, whose office is investigating a half dozen or so advance-fee loan arrangements.In one recent case involving courts in Philadelphia and Michigan, five men pleaded guilty to charges of bilking borrowers of more than $26 million between 2005 and 2011. A sixth was convicted at a trial.Among those who pleaded guilty was the founder and chairman of Remington Financial Group, later renamed Remington Capital, who was sentenced in March to 220 months in federal prison for committing fraud and owing more than $1 million in back taxes. Last year, while awaiting trial, he also was accused of running another advance-fee scheme in Australia.Remington employees "were making promises about what they could deliver, whether they could guarantee them or not, and they just weren't true," said David Axelrod, an attorney for the U.S. attorney's office in Philadelphia who prosecuted the case.Roughly 1,900 victims were identified, including the owner of an independent film company and real-estate entrepreneurs such as Gene May of Park Rapids, Minn. Mr. May said he paid Remington $55,000 in 2005 for help securing a $1.2 million loan he never received. "They totally pulled the wool over my eyes," he said. He had sought the loan to purchase a 35-acre lakeshore property that he intended to sell in lots to buyers for developing vacation homes.Mr. Chapman, the gym entrepreneur, said he sought the advance-fee loan to pay off a high-interest loan from a nonprofit lender and to make upgrades to the rental property where his nine-year-old business is located. His loan broker, Mr. Saddler, who had a firm that went by the name Omicron Capital LLC, accepted roughly $250,000 from customers, telling them he would use the money as a down payment for their promised refinancing deals or for appraiser fees, according to a grand-jury indictment filed in July 2013 in U.S. District Court in St. Louis.Mr. Saddler used the money to make payments on his mortgage, which was in foreclosure proceedings, and for airline tickets, meals and other "personal day to day living expenses," according to court filings."It was a costly lesson," the 50-year-old Mr. Chapman says. "There's no need to upfront money for a loan." Write to Sarah E. Needleman at sarah.needleman@wsj.com and Ruth Simon at ruth.simon@wsj.com