Trading Standards issue advice about loan sharks

Trading Standards has issued advice about how to spot the signs and what to do if you or someone you know is borrowing money from a loan shark.

The Public Protection Partnership covering West Berkshire, Bracknell and Wokingham said that loan sharks are people who lend money without having the authorisation from the Financial Conduct Authority (FCA) to do so.

It also said that loan sharks come in all shapes, sizes, ages, ethnic groups, social backgrounds, and genders, and can include a friend of a friend, a neighbour, work colleague or someone who is part of an organised crime group.

It is estimated by the England Illegal Money Lending Team that 1.08 million people are using a loan shark in England.

Red flags to look out for include no contracts to sign, no proof of income required from the borrower and no receipts given for payment.

Loan sharks will lend to anyone, including children, and take cash, goods or in kind payments to repay the loan. New borrowers are found via word of mouth, a loan shark rarely advertises their business.

A loan shark will often start out friendly at the point of borrowing and convince the borrower they are doing them a favour.

Unfortunately, when the borrower misses a payment, increased penalty charges, threats, intimidation, blackmail, and violence generally occur.

The borrowing may start out as a small amount, but soon rises.

The Illegal Money Lending Team provide an example of a victim of a loan shark who originally borrowed £500 for household bills, three years later and after paying back a total of £18,000, the victim continued to owe the £500.

West Berkshire Council leader Lee Dillon said: “With Christmas fast approaching and the cost of living crisis continuing to impact on finances, more people are having to borrow money to meet their basic financial demands such as housing, food and utility bills.

“Loan sharks prey on our most vulnerable in society, their actions of lending money are illegal and can cause both psychological and physical harm to their victims.

“I therefore urge any resident across the partnership who is or suspects a relative or friend to be borrowing money illegally, to contact the England Illegal Money Lending Team, and those who currently find themselves in financial hardship to contact their local Citizens Advice Service for confidential, free and impartial advice.”

To contact the England Illegal Money Lending Team, call 0300 555 2222, email reportloanshark@stoploansharks.gov.uk or live chat at www.stoploanshrks.co.uk