Somerset says no to loan sharks
Prospects in Somerset has teamed up with other advice and support agencies in the county to support the Illegal Money Lending Team England (IMLT). During September our advisers from Work Programme
worked with customers to raise awareness of the dangers of illegal lenders, also known as loan sharks by promoting the “say no to loan sharks” message. The aim was to encourage people to turn away from illegal lenders and help them feel confident to report the crime if they have borrowed.
An estimated 310,000 households across the country are in debt to a loan shark. These criminals 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 - 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.
Shona Howes, Prospects Team Manager said “We work with many vulnerable people who are mandated to attend our sessions. They are often fearful that their benefits will be stopped and feel that loan sharks are the only solution left open to them. We were keen to get involved in this initiative to highlight this issue and to ensure our customers understand that there are other ways to solve their money problems including local credit unions for those who may need to borrow money.”
Government policy states for those who can work most will be better off if they do work. During September we supported 38 customers and 45 customers in October across Somerset to get into a job, ensuring they are now better off working.