How housing associations are helping to stop loan sharks

Housing associations across the country are working in partnership with the England Illegal Money Lending Team (IMLT) to identify the signs of illegal money lending activity and help tenants who are in the grip of loan sharks.

Loan sharks are unregulated, often giving cash loans without any paperwork, and they can charge extortionate interest rates.

70% of victims supported by the IMLT during the past year pay rent for their property. Research shows that if a loan shark is operating in your area, rent arrears, anti-social behaviour and the number of void properties will increase. If a tenant borrows from an illegal lender to pay off rent arrears or for everyday living costs, you can be certain that they’ll soon be back in debt again.

This article highlights three examples of the work that IMLT have been doing with housing associations.

Working together: Operation Oche

The case of two suspected loan sharks operating on a social housing estate was referred to the IMLT by Stockport Homes. The couple were well known in the community for illegal money lending and were also involved with stolen property, drugs, ASB and other criminality.

There were huge rent arrears and depression on the estate, plus abandoned properties. The police installed a surveillance camera on a concrete pole – it was taken down over night and destroyed: the lenders clearly thought they were untouchable.

Carrying out a joint door knock, the housing association and IMLT worked together with the local police and partner agencies to offer debt advice and housing support whilst gathering additional intelligence from tenants in arrears.

The case resulted in four guilty pleas for illegal money lending, and under the Proceeds Of Crime Act, the lender’s house was confiscated and then bought back by the housing provider.

Saving together: Tenants

The IMLT are working with Clarion Housing, Lewisham Plus Credit Union and Contis who provide Engage – a pre-paid Visa debit card. The project is designed to help tenants manage their day to day finances using the envelope facility that the card offers.

• Users get access to the Engage card with mobile and contactless technology.
  
  
• Tenants can ring-fence essential bills on the account to help budget their weekly/monthly finances – at any stage, the user has access to finances.
  
  
• They can earn cashback rewards by using the card in certain high street stores.

The IMLT are covering the cost of the card for 12 months to allow vulnerable tenants to adopt new budgeting behaviours over this period.

Saving together: Staff

The IMLT have identified that new apprentices may be financially vulnerable when they first begin working, trying to learn how to budget, whilst waiting for their monthly wages.

All apprentices will be trained to help prevent them from becoming the victims of illegal money lending, and additionally to help them identify victims as they progress through their careers in housing.

The IMLT and Clarion are encouraging the apprentices to join their credit union and begin saving via payroll deduction. If the employees can save via their salary for three months, the Stop Loan Sharks Team will credit the apprentice’s account with £25.

Get in touch

If you would like to discuss ways of shark proofing your policies, book free bespoke training for staff or find out how to apply for up to £5,000 to raise awareness of loan sharks in your area, please contact:

• IMLT helpline: 0300 555 2222 
• Email: Catherine Wohlers 
• Alternatively, visit www.stoploansharks for more information about the IMLT.