Illegal money lending project
Illegal moneylenders, or loan sharks, are those who lend money to people without a credit licence. Loan sharks prey on some of the most vulnerable people in society and cause immense misery. It has always proved very difficult to bring them to justice.
In 2004 BIS provided funding for two specialist enforcement teams based in Glasgow and Birmingham City Councils to investigate offences of illegal money lending. Prior to this, illegal money lending was largely a hidden crime and local authorities lacked the specialist skills and training needed to tackle it effectively.
The work of the two pilot teams made a huge contribution to raising awareness of the nature and impact of illegal lending; understanding how best to tackle the problem; and understanding the need to help victims of loan sharks access affordable credit and other sources of support. Building on the success of the pilots, the project was rolled out in 2007 with regional teams providing cover throughout England, Scotland and Wales.
Stop Loan Sharks Campaign
In addition, a single national hotline number (0300 555 2222) and a Stop Loan Sharks website were launched to warn against the dangers of illegal lending and encourage greater reporting of loan sharks on a national scale. Further details can be found on the Directgov website at: Directgov - Stop Loan Sharks.
Future Funding Announcement
On 29 December 2010 Consumer Minister Edward Davey announced that BIS will continue to fund the IML project throughout 2011/2012. The project will receive funding of approximately £5.2million and it is expected to be similar in 2012/2013. However, in order to deliver even better results and more efficient service the structure of the teams will be reorganised – moving away from regional teams to a structure that will see one team across England alongside national teams in Scotland and Wales. Action to tackle IML in England will be co-ordinated by a Birmingham based team that already covers 5 regions and has proved to be extremely successful. Expanding its role will bring efficiency savings but should also bring better results – with independent research showing that larger teams have proved more successful than smaller ones.
