A crackdown on loan sharks will tackle unlawful lending and increase support for victims.
From today, more than £5.5 million of funding will be provided to Britain’s Illegal Money Lending Teams (IMLT) and organisations in Northern Ireland to clamp down on illegal lenders and support their victims.
The IMLT will receive 16% more funding this year in a bid to stop illegal lending and £100,000 of money seized from loan sharks will be spent helping vulnerable people in England access safer forms of finance such as credit unions.
In Northern Ireland, an education project will be launched to raise awareness of the dangers posed by loan sharks.
It is estimated that more than 300,000 are in debt to illegal money lenders across the UK.
In England, the teams have made more than 380 prosecutions since they were set up in 2004, writing off some £73 million in debt owed by more than 28,000 people and leading to 328 years’ worth of sentences. Similar teams work in Scotland and Wales.
Tony Quigley, head of the England IMLT, says: “Loan sharks are a blight on society and prey on vulnerable people who struggle to make ends meet. These criminals use callous methods to enforce repayment and victims are often subjected to threats, intimidation and violence. We will not tolerate this sort of criminal activity in our country and loan sharks who are caught flouting the law will be pursued and prosecuted.”
The crackdown has been welcomed by debt charity StepChange. It says unlawful lenders often take advantage of households with the greatest levels of financial need. An estimated 1.4 million lower income households used high-cost credit to meet day-to-day living costs last year.
Peter Tutton, head of policy at StepChange, says: “Cracking down on the unconscionable activities of loans sharks is a very welcome step, but it needs to accompanied by a focus on the high-cost credit market more generally to reduce the harm being experienced by the vast numbers of households forced to borrow to make ends meet.”
Mr Quigley adds: “It is important for people to realise that alternatives to borrowing from loan sharks are available if you are in financial difficulty. Loan sharks are never the answer.”
If you have been affected by illegal money lending, you can call the Illegal Money Lending Team confidential hotline on 0300 555 2222.