TOUGHER measures will be introduced to root out aggressive loan sharks in Wrexham.
Wrexham Trading Standards confirmed it has secured council approval for the Wales Illegal Money Lending Unit to begin operating in the town next month.
A looming recession, shortage of available credit on the high street and lenders charging colossal rates, as much as 117,000%, have prompted the move.
Evidence from pilot schemes elsewhere in Wales has also convinced Wrexham County Borough Council of the unit’s effectiveness.
In the last 12 months, there have been 36 reported cases of illegal money lending, 13 people have been arrested, with 17 charges. More than £900,000 has been seized.
At a council briefing Wrexham senior trading standards officer, Peter Brown, said: “We’re still in the formation stage.
“However, evidence from Cardiff indicates illegal money lending is widespread.
“So it’s reasonable to assume so in a town the size of Wrexham.
“Under the Consumer Credit Act 1974, people who lend money have to be licensed and operating from a trading premises.
“The unit, whose measures will be enforced by Trading Standards, will investigate illegal money lending and support people who’ve got into problems with loan sharks.
“Some are charging 100% APR to 117,000% APR rates, so short term loans can very quickly escalate.
“It won’t be easy to investigate because people are reluctant to come forward.
“Illegal money lenders have been found to resort to violence and intimidation.
“When people come forward and provide evidence they’ll be given protection.”
Leader of Wrexham Council, Cllr Aled Roberts, said the unit’s presence will be part of the authority’s overall anti-poverty strategy.
He said: “Wrexham Council already has strong links with the Citizen’s Advice Bureau (CAB) and Credit Union.
“Given the effects of the credit crunch, those at the bottom level of the lending ladder tend to fall out of the system.
“Loan sharks prey on these, some of the most vulnerable people in society.
“There are four Community First areas in Wrexham and CAB statistics show levels of debt enquiries have grown.”
The unit’s 24-hour confidential hotline can be contacted on 0300 123 3311.
