Charter launch to help step up campaign against loan sharks

A new charter is being launched next week in York in a bid to highlight the perils of dealing with loan sharks while council staff are given specific training to spot potential cases and prevent more people falling prey to the organised gangs of criminals.

It comes as the head of a national unit tasked with tackling illegal money lending has admitted the problem is becoming increasingly wide-spread across all sections of society as victims are driven to take out loans at exorbitant interest rates.

The England Illegal Money Lending Team has been operating in the North Yorkshire city since 2009 when a pilot project was first launched, but the threat of loan sharks has escalated to such an extent that the decision has been taking to instigate a dedicated agreement to tackle offenders. National research has shown the number of households using loan sharks has soared from 165,000 in 2007 to 310,000 last year.

The head of the England Illegal Money-Lending Team, Tony Quigley, said: “Illegal money lending is a despicable crime happening in communities all across the country. As it’s criminality it’s impossible to put a figure on the scale of the problem, but we know from research that an estimated 310,000 people across the country are in debt to loan sharks.

“We are continuing to crack down on loan sharks in York and across Yorkshire and are working with local partners to raise awareness in communities and encourage people to steer clear of loan sharks who will exploit and extort from their borrowers.”

York is the first area in Yorkshire and only the sixth nationally to draw up a specific charter to tackle loan sharks. Efforts are also underway to promote a credit union in North Yorkshire after the collapse of a previous scheme which led to the loss of hundreds of thousands of pounds of taxpayers’ money. More than 5,700 savers were affected when the North Yorkshire Credit Union was placed into liquidation in November last year after accruing outstanding debts of more than £400,000 since being launched in 2009.

The England Illegal Money Lending Team has now sponsored a new initiative with South Yorkshire Credit Union, which will mean the first 25 people who join the scheme at a launch event in York on Tuesday next week and continue to save will receive a £25 voucher paid for with proceeds of crime money taken from convicted loan sharks.

Property landlords and other housing professionals will also be offered guidance to help pinpoint cases where illegal money lenders are targeting tenants.

York Council’s cabinet member for crime and stronger communities, Coun Linsay Cunningham-Cross, said: “With more and more families facing problems with debt, it’s imperative people are aware of the dangers of borrowing money from illegal money lenders.

“With the charter we are launching with the England Illegal Money Lending Team, loan sharks operating in York will continue to be stopped by a specialist team dedicated to cracking down on unlicensed lenders. It is important people know that there are properly regulated financial alternatives to loan sharks which can give assistance to people going through tough times, and have safer access to loans.”

Some loan sharks operating in England are charging interest rates up to a staggering 130,000 per cent and have even forced victims into prostitution to repay debts as well as carrying out acts of extreme physical violence.

Nationally, 267 prosecutions have been secured for illegal money lending and related offences, leading to more than 172 years of custodial sentences. Specialist investigators have recovered £40.3m of illegal debt and helped more than 22,000 victims.