Richmond.gov.uk

Don’t get targeted by loan sharks to cover Christmas

22 November 2022

Experts have warned that unscrupulous lenders could try to cash in on the festive period as households struggle to cope with rising food, fuel and energy bills. Loan sharks are targeting vulnerable people seeking credit and trapping them into a cycle of debt with exorbitant interest rates and threats of violence.

Experts have warned that unscrupulous lenders could try to cash in on the festive period as households struggle to cope with rising food, fuel and energy bills. Loan sharks are targeting vulnerable people seeking credit and trapping them into a cycle of debt with exorbitant interest rates and threats of violence.

Nearly one in ten people turned to loan sharks to cover the costs of Christmas last year.

More than half of victims turned to illegal money lenders in order to pay for essentials such as utilities, food and fuel in the first half of 2022.If you need financial support due to the cost of living crisis, there is help available. Visit the Richmond Cost of Living Hub to find out more.Loan sharks pose a dangerous threat to all communities. They charge exorbitant interest rates and target the most vulnerable with aggressive and exploitative practices. The impact of illegal money lending is severe and far-reaching, with devastating consequences for the mental health and wellbeing of those affected.The England Illegal Money Lending Team (IMLT) have published safety tips to help people to protect themselves and loved ones from loan sharks:

  1. If you're struggling to make ends meet and need cash fast, the thought of a loan shark might seem tempting, but remember these lenders are not your friends. Debt can quickly spiral out of control – it's important to think carefully before taking out a loan and consider other options
  2. Never send money or give credit card, online account details or copies of personal documents to anyone you don’t know or trust. This information is valuable so make sure you protect it from criminals who can use it to find and stalk you, harass you or threaten those you love
  3. If you’re thinking about borrowing money, it’s important to check that your lender is genuine. Loan sharks operate illegally without the correct permission from the Financial Conduct Authority (FCA). Do your research first and check the firm or person you're dealing with is listed on the Financial Services Register
  4. When exploitative loan sharks are preying on hardship, it’s vital for people to know there is an ethical, local, not-for-profit alternative available. Credit unions are a lifeline for many people, with their services helping members to save regularly, borrow responsibly and keep track of their finances. There are other community lenders who are mostly not for profit, and who reinvest any surpluses into serving vulnerable customers, which can be found on Finding Finance website
  5. Getting trapped in a never-ending spiral of debt after borrowing from a loan shark can have devastating consequences, not only on your finances but also on most other aspects of your life, including your mental health, work and relationships with your family and friends.

If you are worried about a friend or family member, or if you need help yourself, IMLT Stop Loan Sharks can offer confidential advice and support. Are you worried about a friend or family member who is being taken advantage of by a loan shark?Contact the Stop Loan Sharks 24/7 Helpline on 0300 555 2222 for support or visit www.stoploansharks.co.uk. Live Chat is available on the website between 9am and 5pm, Monday to Friday.

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Up to: November 2022

Updated: 22 November 2022

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