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Loan sharks demand sex to pay debts; EXCLUSIVE Vulnerable women 'exploited by money-lenders'.

Byline: By Emma McKinney CONSUMER EDITOR

BIRMINGHAM loan sharks are forcing vulnerable women into having sex with them to pay off their debts as more people plunge into the red as the recession bites.

Staff at the Birmingham-based Stop Loan Sharks project say they are being contacted by an increasing number of women, particularly single mums, left distraught by sex fiend money-lenders if they say they can not afford to meet loan repayments.

Other borrowers of the illegal loans are beaten up or threatened with violence, while some sharks hold people to ransom by keeping their bank cards or Post Office books or even turn to their friends or relatives to pay-up the debt.

A spokeswoman for the Government funded project, said: "Loan sharks prey on the most vulnerable members of society and are often engaged in a wider web of illegal or dangerous activity.

"We have unearthed crimes including kidnapping, counterfeiting, assault, wounding, blackmail and sexual intimidation. They work within a community, often starting out as a 'friend', offering to help with someone in financial trouble, then becoming aggressive when that person can't pay.

"They charge extortionate interest rates, trapping their victims in a cycle of debt, lending money so they can repay an on-going debt, so the amount owed keeps increasing.

"We would urge people never to use them."

The Stop Loan Sharks project, which started as a pilot project in the West Midlands in 2004 but has proved such a success it has been rolled out to places across the country, has so far helped more than 7,000 victims, written off more than pounds 8 million of illegal debt, secured over 30 years' prison sentences and found log books containing pounds 4.6 million in loans.

The news comes as even legal creditors are getting tough as they fight to survive the recession, with some banks and loan companies forcing people to go bankrupt or lose their homes over debts as low as pounds 750.

Trading Standards officers at Birmingham City Council's Money Advice Service have been inundated by families on the brink of losing everything.

Now officers fear proposals under the Tribunals, Courts, and Enforcements Bill could enable creditors to push for bankruptcy at an even quicker rate and for even lower sums.

Chris Neville, head of Trading Standards, said the council is doing all it can to pressure the Ministry of Justice in a bid to stop the Bill from being passed.

"We will continue to lobby the Government over this," he said. "We are already finding, as the recession bites, that whereas this time last year the credit companies would have allowed us to negotiate a payment schedule for someone who owed money, they're now pushing for bankruptcy at an earlier stage than ever.

"People need to realise that any unsecured debt can result in them being forced to sell their house to settle a relatively small debt."

He described new figures revealing the average Birmingham householder is pounds 9,740 in debt, excluding mortgages, as "alarming".

Last year Money Advice Service helped 424 people with a collective debt of pounds 5.8 million, a figure which officers fear could double this year.
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Publication:Birmingham Mail (England)
Date:Jan 19, 2009
Words:530
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