Council issues loan shark warning
Published by Max Salsbury for 24dash.com in Local Government and also in Communities, Finance, Legal
Harrow Council has warned local residents that loan sharks are operating in the area, preying on households hit by the government's benefit cuts.
The council issued the warning after Harrow Citizens Advice Bureau (HCAB) unearthed information about the bullying tactics employed by local loan sharks.
Practices include sending threatening texts and voicemails, and waiting outside schools attended by the children of people that they have lent money to.
One case in particular highlighted these practices to be reported among the borough’s Tamil community but it is clear that all vulnerable families in need, from whichever community, may be at risk of sharp and intimidating tactics.
In response to the threat, HCAB is to open face to face drop in sessions from next week to add to the existing telephone and email services, following additional funding by the council.
HCAB says that 65% of the issues it currently deal with are related to benefit and debt issues and it expects the number to increase.
The council is warning residents not to use illegal lenders or payday loan companies. Instead, it recommends those in need of funds to first seek advice from HCAB and then, if a loan is essential, to consider joining their local Credit Union – M for Money – a not-for-profit cooperative which caps interest rates and has a strict criteria for lending money.
It has also has set up an emergency relief scheme for those on means tested benefits who are in dire need of food or other essentials.
Council leader Thaya Idaikkadar said: “Harrow Council is providing extra support to some of our most vulnerable residents who are facing very difficult economic times and uncertainty around changes to their benefits.
“It is absolutely abhorrent that loan sharks are preying on vulnerable people who are struggling to make ends meet.
“We strongly advise our residents to seek the free support of HCAB and not be tempted to use illegal lenders or unscrupulous payday loan companies for a short term fix. The consequences can be devastating.”
Jill Harrison, chief executive of HCAB, said: “The reports of illegal money lending that are starting to come through to us are very concerning. Although they may be tempting to use, illegal lenders or pay day loan companies are not a solution to people’s problems because they are likely to cause even more problems further down the line.
“We find that in many cases after people speak to us, they in fact find that they do not need to borrow money and just needed advice on how to apply for benefits or manage their finances more effectively.”