illegal money lending - a short guide

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Illegal Money Lending

Short Guide

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Key Project Objectives

Achieving and understanding of the nature and scale of the loan shark problem

Reducing the incidence of illegal money lending Addressing the climate of fear that works against

reporting Changing the perception that lenders can operate with

exemption from punishment Supporting victims in finding viable alternative sources of

credit following the removal of an illegal lender

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Background cont/

InvestigatorsLiaise

Work from regionWork from BirminghamBest Practice

Specialist skills Safe and efficient systems

• We consist of investigators, Liaise Officers Operational managers, intel team, admin assistants and press office.

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The Issue

“The activities of illegal lenders are profoundly damaging to both individual victims and the communities in which they operate. Illegal money lending locks in and reinforces financial and social exclusion, compromising the viability of household and family budgets and degrading quality of life, not least through the exacerbation of anti-social behaviour, drug use, violence and crime in areas in which these issues

are already deeply problematic.”¹

¹Policis/PFRC study for DTI “Evaluation of the illegal money lending pilots”, February 2007

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The illegal money lender

• A person who, not being the holder of a license¹, lends money (lending in the course of trade or business) and charges interest, especially at an exorbitant or unlawfully high rate.

• Synonyms: Loanshark• Criminal offence: s39(1) Consumer Credit Act 1974

¹The Consumer Credit Act 2006 requires most businesses and individuals that offer goods or services on credit or lend money to consumers to be licensed by the Office of Fair Trading (UK). Trading without a licensing arrangement is a criminal offence and can result in a fine and/or imprisonment.

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The Victim

Previous research suggests that a person in Great Britain taking an illegal loan tends to be:

• At a vulnerable stage in life• On tight budget margins• In deprived, low-income areas• Over 50% of victims have exhausted all legal credit• Around 30% have drug, alcohol or mental health

problems¹

BUT LONDON SEES A MUCH BROADER RANGE OF PEOPLE THAN THIS!

¹Information based on, Policis/PFRC study for DTI “Evaluation of the illegal money lending pilots”, February 2007

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DO• Actively encourage victims of loan sharks to telephone

the stop loan shark hotline.• Pass information onto the stop loan sharks hotline

number or to your local liaise officer about suspected issues of loan shark activity in your community.

• Raise awareness verbally and visually about the Stop Loan Sharks Project in your community for example putting posters up in your Offices and notice boards.

• Contact your LIAISE officer to speak about ideas for awareness raising in your community

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DON’T• Ever put yourself or anyone else in danger or

at risk

• Ever approach someone you suspect to be a loan shark

• Actively go out to find out information about someone you suspect maybe acting as a loan shark.

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Remember……

• victims are not in any trouble if they take out an illegal loan.

• Once the illegal lender has been arrested, the victim NO LONGER HAS TO PAY!

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Remember……

• Illegal lending is a crime (2 years imprisonment)• victims are not in any trouble and do not commit a

criminal offence if they take out an illegal loan• An illegal debt is not enforceable (s40 CCA)• A national 24/7 hotline exists for advice and to report

Illegal loans cannot be recovered through the county court

• Persons who lend money need a license – free OFT public register at www2.crw.gov.uk/pr/Default.aspx

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Do you know a victim?

• Owe money to a friend?• No paperwork?• Loan that just keeps growing?• What you can do:

– Pass the intelligence to us– Support the individual to talk to us– Arrange a meeting with a LIAISE Officer for a

discussion about what support is available

• Every piece of information can help

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How to contribute:

To pass information to the team you can:

• Call the hotline on 0300 555 2222 at anytime• E-mail:

reportaloanshark@stoploansharks.gov.uk • Text ‘Loan shark (+ your message)’ to 60003

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Regional Contacts• Steve Ward, East Midlands• steve.ward@birmingham.gov.uk• Ailsa Guard, South West of England• ailsa.guard@birmingham.gov.uk• Wendy Loades, South West of England• wendy.loades@birmingham.gov.uk • Jo Clarke, South East of England• Joanne.clarke@birmingham.gov.uk• Lin Fisher, South East of England• Lin.fisher@birmingham.gov.uk• Denise Meek  - North East Region

denise.meek@Birmingham.Gov.uk• Natalie Barker, - North East Region• Natalie.barker@birmingham.gov.uk• Nadeem Mahammed, West Midlands• nadeem.mahammed@birmingham.gov.uk • Christopher Connor, West Midlands

Christopher.Connor@Birmingham.Gov.uk

• Anna Fraser, East of London• anna.fraser@birmingham.gov.uk• Karen O’Neill, South of London• Karen.o’neill@birmingham.gov.uk• Jo Hartley, North West Region• Joanne.Hartley@birmingham.gov.uk• Tracy Fairhurtst, North West Region• Tracy.Fairhurst@birmingham.gov.uk• Aidan Wheller, Yorkshire and

Humberside • Aidan.Wheller@birmingham.gov.uk>

Mike McAughtrie, Yorkshire and Humberside

• Mike.Mcaughtrie@birmingham.gov.uk• Matt Thubron, EETSA• Matthew.Thubron@birmingham.gov.uk• Patrick Brown, EETSA• Patrick.Brown@birmingham.gov.uk

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Contact details

• Anna Fraser

• 07557 203 150

• LIAISE Officer for London Region

• 0300 555 2222 is the Stop Loan Sharks hotline, open 24 hours a day, seven days a week.