Councils caution against turning to loan sharks to cope with cost-of-living crisis

Ted Peskett, local democracy reporter

Councils have urged members of the public not to consider turning to loan sharks after a regulatory body said it feared a rise in people taking desperate measures to deal with financial pressures.

The Shared Regulatory Service (SRS), which provides regulatory services for Cardiff Council, Vale of Glamorgan Council and Bridgend County Borough Council, said it has received intelligence that suggests an increase in people turning to loan sharks amid the current cost of living crisis.

SRS operational manager Helen Picton said at a committee meeting this week that there are “real concerns in the number of loan shark cases” the service is facing.

She said: “Clearly there are people out there who need help. The more we can do to raise awareness, the better.”

Spiral of debt

A Cardiff Council spokesperson said: “Borrowing money from loan sharks is the worst possible option, as it causes a spiral of debt which often is never paid off, due to eye-watering levels of interest and penalties imposed by the illegal lender.

“Loan sharks are not regulated and they often prey on vulnerable people, dominating their lives to take as much money from them as possible.

“If anyone in Wales has been a victim of a loan shark, or is concerned that a friend, neighbour or a family member is, please contact us. Any intelligence received will be investigated, with the aim to bring these unscrupulous individuals to justice.”

Vulnerable

The Vale of Glamorgan Council is working to support the Wales Illegal Money Lending Unit in their work to stop loan sharks and support those who may be vulnerable to illegal money lending.

The council also said that the pressure brought on to peoples’ lives by the cost of living crisis is driving people towards loan sharks.
A council spokesperson said: “These circumstances will make more people vulnerable to illegal money lenders.
“The new Cost of Living Hub on the council’s website provides information on lots of support, including the latest phase of cost of living grants, available to residents as well as lots of wellbeing and money advice.”