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Agencies Unite to tackle loan sharks

Published Friday, 11 October 2013

Agencies in Enfield pledged a zero tolerance approach to loan sharks, when they met to sign a charter against the crime on Monday (October 7).

illegal loan sharks

The England Illegal Money Lending Team, a specialist team who investigate and prosecute loan sharks, organised the event with Enfield Borough Council to bring together local organisations to explain what being done to tackle this crime and how their organisations can help. 

There is often a reluctance to speak about loan sharks, but the charter aims to start a conversation about the issue and in doing so reach those who are at risk- often some of the most hard to reach people.

Consumer Minister Jo Swinson attended the event to meet with the England Illegal Money Lending Team and other agencies to discuss tackling illegal money lending.

Enfield Council was recently commended for their outstanding work highlighting loan sharks, as national winners of the Stop Loan Sharks Award. The England Illegal Money Lending Team presented them with their award during the event and they also received £1,000 worth of proceeds of crime money taken from convicted loan sharks to fund further awareness raising in the borough.

The event provided an opportunity for representatives from local agencies to find out more about the issue, and spot illegal money lending in communities, enabling them to support and signpost anyone they meet in their day to day work who may have been a victim. There was also be a question and answer session with the England Illegal Money Lending Team and Enfield Trading Standards.

Nationally the Illegal Money Lending Teams have secured 266 prosecutions for illegal money lending and related activity, leading to more than 171 years worth of custodial sentences. They have written off £40.3 million worth of illegal debt and helped over 22,000 victims.

Loan sharks usually appear friendly at first but quickly trap their borrowers into spiralling debt. As the debts can’t legally be enforced many lenders will resort to the most extreme and callous methods to enforce repayment including threats, violence and intimidation.

Paperwork is rarely offered so victims are often in the dark as to how much they are actually paying.  Exorbitant extra amounts and interest are added at random- the highest interest seen by an illegal lender was equivalent to 131,000% APR. In some cases the loan sharks have been known to take items as security including passports, driving licences or even bank or post office cards with the PIN in order to withdraw directly from borrowers’ accounts.

Consumer Minister Jo Swinson said: “Loan sharks are a blight on society and this criminal activity needs to be stamped out. Violence, bullying and harassment go hand-in-hand with this type of lending. We need to clamp down on illegal lenders, prosecute them for their actions and make sure people are aware of the pitfalls. 

“We can stop the problem at the source by making sure people have access to affordable lending. They should know they can turn to free debt advice if they find themselves in financial difficulty and can speak to the Money Advice Service on 0300 500 5000 if they are in financial trouble. Government has also backed this up by announcing £38 million in additional funding to help the credit union industry.

“I am delighted to be here in Enfield to recognise and reward the hard work of the Borough. Enfield Trading Standards have worked tirelessly to stamp out loan sharks and educate the public about the alternatives. The Community Charter is an excellent example of how coordination between local agencies can help confront illegal money lending. The message is clear. Loan sharks are not welcome in Enfield.”

Enfield Council's Cabinet Member for Environment, Cllr Chris Bond, said: “Enfield Council has made tackling illegal money lending a major priority in order to protect our most vulnerable residents and I’m delighted those efforts have been recognised and we have won this prestigious national award.

"Our Trading Standards officers have demonstrated enormous hard work and dedication in helping to prevent Illegal loan sharks from spreading their pervasive influence in our borough.

Enfield Council’s Cabinet Member for Community Wellbeing and Public Health, Cllr Christine Hamilton said: “"Sadly the present financial situation means that more and more people are tempted to borrow from loan sharks to make ends meet, we're trying to demonstrate that borrowing money from a loan shark is never a good idea and can have unexpected and unpleasant long term consequences.

"If you need to report a loan shark or would like confidential advice from the Illegal Money Lending Team ring 0300 555 2222.”

Tony Quigley Head of the England Illegal Money Lending Team said “Illegal money lending is a despicable crime which causes nothing but harm to our communities. These lenders may appear to be offering a community service but borrowers are often forced to pay back far and above what they have borrowed and can afford. Many are subjected to threats, violence or other callous enforcement methods.

The charter brings together a number of local agencies to talk about loan sharks and make tackling them a priority. These agencies are our eyes and ears in our communities, and working closely in partnership with them we are able to create an effective approach to tackle this crime.

We would urge anyone who has been the victim of a loan shark to report them in confidence on 0300 555 2222, as we can help” 

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