MORE AREAS TO BENEFIT FROM TEAMS TO TACKLE LOAN SHARKS
More areas are being given funding to help deal with the problem of illegal money lending following the success of pilot projects in Glasgow and Birmingham, where local authority trading standards officers and the Department of Trade have worked together to tackle loan sharks who often use intimidation to extract big repayments. The Treasury and the Department of Trade have announced 1.2 million pounds of funding for the expansion of the idea into new areas including Sheffield, West Yorkshire and Liverpool.
The pilot schemes in Scotland and the West Midlands are seen by the Government as an important complement to its strategy of making affordable and appropriate sources of credit more easily available for people facing financial exclusion. For the past two years specialist teams have operated in the two areas, working to overcome the difficulties of enforcing the law in cases where victims face fear and intimidation. The teams have been responsible for a number of high profile prosecutions of loan-sharks in Birmingham and Glasgow.
The teams were set up by the DTI in partnership with local trading standards offices. The new funding will allow for the continuation of the projects and their extension into new areas during 2007-08. The existing Birmingham team will be responsible for training and management in the new areas and will act as an English centre of expertise in undermining illegal lending.
During a visit to the city, Ed Balls the Economic Secretary to the Treasury said the scheme had helped to give victims in the West Midlands the confidence to come forward and an awareness of better ways to borrow as well as helping to build evidence against loan sharks to bring them to justice. Research from the DTI found that the UK’s efficient and diverse financial services market meant this country had a lower incidence of illegal lending compared to other European countries but that about 165,000 households here use illegal money lenders. Up to half of these are in the poorest parts of the country, often on deprived urban housing estates, where legal alternatives are hardest to access.