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Govt blunts teeth of loan sharks

19/09/2007

The government claims to have launched the biggest ever nationwide crackdown on illegal lending, with additional funds of almost £3 million allocated to "hunt down" loan sharks across the country.

According to ministers more than 165,000 households facing debt problems are exploited by loan sharks each year, with those living in deprived inner-city areas most likely to fall prey to their advances.

Officials say that people who borrow cash from loan sharks are charged "astronomical" interest rates and often face violence, intimidation or blackmail if they fall behind with repayments.

In a fresh bid to tackle the problem additional funds are to be allocated to support the work of specialist anti-loan shark teams.

Since September 2004 teams of specialist trading standards officers have identified more than 200 illegal lenders and shut down loan books worth more than £3 million in Birmingham and Glasgow.

Following the success of the pilot scheme in the two cities, the initiative is now being rolled out to other areas across England, Wales and Scotland.

Areas where anti-loan shark teams will be operating in future include the London boroughs of Hackney, Newham and Tower Hamlets, while Nottingham, Leicester, Derby, Bristol and Plymouth are among the other locations which will now be covered by the scheme.

Commenting on the roll-out of the scheme business and enterprise secretary John Hutton said: "Loan sharks are criminals who prey on vulnerable and desperate people. We are committed to shutting these thugs down and bringing them to justice.

"Our targeted teams will make sure anyone who feels trapped or scared has the confidence to report these crooks and put a stop to their illegal behaviour," he added.