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Loan Sharks

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Stella Creasy MP quoted in The Sun yesterday

Labour MP Stella Creasy said credit unions were “only part of the solution” and called for a cap on rates.

 

http://www.thesun.co.uk/sol/homepage/news/politics/article4305486.ece

 

GREEDY lenders came under fire yesterday for charging hard-up Brits record interest rates of more than 6,000 PER CENT.

 

Millions use payday loan firms and even illegal loan sharks after banks refuse them credit.

Work and Pensions Secretary Iain Duncan Smith vowed the Government aimed to break the stranglehold of “predatory lenders”.

He called for more credit unions to be opened to offer low-interest loans to the less well-off — as his department released examples of sky-high rates charged by firms.

The full story link here on CAG http://www.consumeractiongroup.co.uk/forum/showthread.php?325085-Epetition-End-the-legal-loan-sharks.-Let-the-govt-know-how-you-feel.Biteback-time./page2

 

You will see the Epetition link on that thread.

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What total and utter bull. The Government will do nothing whatsoever about it. How can they complain about these lenders when they themselves actually sanction these high rates by giving out licenses to anyone who wants one and refusing to take them away no matter how many complaints are lodged or for what reason even lying, cheating and harrassment.

 

So that makes the Government complicit in all the evil surrounding this industry. They can't complain about the banks either, they own one but that lends nothing and rips off it's customers just like the pay day loan companies and the backstreet loan sharks. I would say that the ease of getting a license makes the Government actively encouraging this type of lending.

 

And let's not forget that it was Labour that started all this and landed the country with all these problems we now have so she is just trying it on.

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Regardless of whichever political party was responsible for the rise of the PDL 'market' it has been around a lot longer than the last Labour government was - it maybe has not been as 'high profile' as now since the banks have stopped lending to anyone for the least reason the 'market' needs reigning in and regulating now it is more 'mainstream'.

 

The likes of Wonga becoming a bank is frightening, and this 'espansion' into mainstream financial products needs to be blocked. Just because the company can 'attract the right investors' it does not mean it is 'fit for expansion into the mainstream industry'.

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What total and utter bull. The Government will do nothing whatsoever about it. How can they complain about these lenders when they themselves actually sanction these high rates by giving out licenses to anyone who wants one and refusing to take them away no matter how many complaints are lodged or for what reason even lying, cheating and harrassment.

 

So that makes the Government complicit in all the evil surrounding this industry. They can't complain about the banks either, they own one but that lends nothing and rips off it's customers just like the pay day loan companies and the backstreet loan sharks. I would say that the ease of getting a license makes the Government actively encouraging this type of lending.

 

And let's not forget that it was Labour that started all this and landed the country with all these problems we now have so she is just trying it on.

 

I do remember the Cons being the torch bearers for unregulated lending when they entered office in 1979, the meltdown began. Lending was controlled before.

 

Anymore comments on the politics may have to be continued here http://www.consumeractiongroup.co.uk/forum/showthread.php?347991-Whats-still-wrong-with-this-country.

 

It would be nice to have a comment from a Con on this subject, debate is helpful.

Edited by determindator

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What the stupid Government cannot see is that a cap on interest rates would allow for more affordable payments to be made. In turn the public who have to borrow for whatever reason would have more spare money to spend elsewhere - e.g. on the high street.

 

I wish the government would look into recruiting an economist!

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Can't help wondering if any donate to cam's lot.

 

Its just a shame their business must be fueled further by falling benefits.

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skkw_wfw_33.jpg

#SaveBianca! Ask Your MP to help end legal loan sharking on Tuesday 22 May 2012!

 

Hello!

skkw_debtpicture.jpg

The vote for proposals to tackle legal loan sharking will take place on Tuesday 22 May 2012. Please ask your MP to vote for amendment 40 of the Financial Services Bill and help give British consumers the same protection from payday loan companies other consumers across the world enjoy!

In a House of Commons debate in April the Government Minister responsible for this bill Mark Hoban agreed the Financial Conduct Authority should be able to regulate the cost of the credit, but refused to back this amendment which would explicitly authorise the FCA to do this. They plan to tell their MPs to vote against it and so stop this proposal becoming law.

Independent consumer legal advisers are clear – without explicit authority to do this the regulator will struggle to use new powers as these companies will contest any such action in the courts. The Office of Fair Trading has also admitted the involvement of ‘expensive lawyers’ in cases has influenced their ability to act, highlighting the need to address this problem.

This amendment is a key tool in the fight to tackle legal loan sharking - Fines will only have a limited impact on an industry which is making millions lending money at astronomical rates of interest to British families. On the otherhand, capping their charges could send a strong signal about what costs of credit will be tolerated in the UK. Its the first step towards securing industry wide caps on the total costs of credit, and so giving British consumers the same protection from these loans that others around the world enjoy.

Below is a sample text to use to email your MP to ask them to vote for this amendment - you can find the contact details of your MP here. You can also help by tweeting about the campaign using the #savebianca hashtag in reference to the recent Eastenders storyline on this subject!

Help me make a difference to the families in our communities struggling financially because of these companies by taking action- let's together end legal loan sharking in Britain!

 

skkw_stellasignatureshort_3.jpg

 

Stella Creasy

Labour and Co-operative MP for Walthamstow

p.s. Please also

share this email with your family and friends to ask them to defy the Government and support this amendment on Tuesday!

Suggested text to send to your local MP

Dear XXX

As one of your constituents I'd like to ask you to vote on Tuesday 22 May for an amendment 40 to Clause 22 of the Financial Services Bill to help tackle legal loan sharking.

In an industry making so much money from lending to people at excessive rates of interest, fines will do little to curb their behaviour-

one firm posted a pre-tax profit of £162m last year, and another paid its chief executive £1.6m. On the otherhand, giving the new regulator explicit powers to cap the charges they can set would send a strong message to this industry about the costs for loans that should be considered acceptable and the way they can treat British consumers. It could make a real difference to the millions across our country now struggling financially who are borrowing from these companies to make ends meet by encouraging firms to reduce their charges.

Ministers claim they support the spirit of the amendment but refuse to vote for it- legal advisors are clear that without explicit powers to act, these companies will be able to challenge action in the courts. Don't let the fight against legal loan sharking become a fee generating opportunity for lawyers- please vote for this amendment on Tuesday and join the fight to end legal loan sharking in Britain.

I look forward to reading that you voted for this amendment,

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My betting it 5,000% it will fail.

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It's been a little while since we've seen 'tawnyowl', but if you are monitoring your emails, I did send your suggested letter to my MP with an added sentence

 

"Failure to vote for will mean you condone the lending to the poorest with interest rates up to 8,000%. Why an MP would be in favour of allowing such rates is completely incomprehensible. You should also keep in mind that these are mainly overseas companies so the massive profits they make do not stay in nor benefit this country."

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All bull****, nothing will change, they haven't got the guts to do so.

 

I disagree. I think there will be some fallout :)

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I'm not saying they will stay exactly as they are now, but my money is on self regulation with the guidelines drawn up by the companies themselves and that they will not put a cap on the gross interest charged nor will they be curtailed in their harassment.

I think that covers just about all they are doing now.

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There will not be an interest rate cap. It is actually possible for a court to cap interest rates right now on all CCA regulated agremeents (including payday loans) via Time Order provisions. The OFT isn't interested in the mechanics of credit agreements moreso the behaviour of the creditors themselves. The FCA will be more interested in interest rates etc but they're not around just yet, sadly.

I'm pretty confident several firms will go. In fact I'm VERY confident :)

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Are they being tackled? My betting is they just went there for coffee, nothing will happen to them, it never does. They've already announced they will not be capping their interest rate.

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I am a little disappointed that so few consumers made complaints to the OFT and FOS.


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Apathy rules here I think CitizenB, many people who have taken PDLs and other subprime or even illegal 'back street loans' bury their heads even further in the sand with each

letter chasing the debt.


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Are they being tackled? My betting is they just went there for coffee, nothing will happen to them, it never does. They've already announced they will not be capping their interest rate.

 

 

Really?

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