Victim who 'lived in fear' warns others to avoid using loan sharks at all costs

  • ITV Wales' Consumer Affairs Reporter Kate Lewis has spoken to a mum from south Wales who turned to a loan shark

The festivities are over but in the cold light of January, it’s the real cost of Christmas that is at the forefront of people’s minds. In fact, for those already facing financial hardship it is often all they can think about and knowing where to turn for help and support can be daunting. 

For one young mum from south Wales, who spoke to ITV News anonymously, she knows firsthand how hard it can be.

A few years ago she was in need of some basic essentials for her children but living ‘pay cheque to pay cheque’ and having a poor credit rating meant she wasn’t able to borrow from a bank. So she turned to a local illegal money lender also known as a loan shark. 

The use of Loan Sharks is happening up and down the country, particularly in small, local communities, and is a huge underreported problem. 

It is breaking the law for anyone who is not authorised by the Financial Conduct Authority (FCA) to lend money but according to the latest figures by Stop Loan Sharks Wales, an organisation that investigates and prosecutes Loan Sharks throughout Wales, sixty per cent of those that now come forward have used an illegal money lender or Loan Shark to cover everyday expenses.

The young mother we spoke to initially began by borrowing around a thousand pounds.  Credit: ITV Cymru Wales

A few years ago, people would only tend to use them in order to purchase unexpectedly needed or significant items such as a new fridge, freezer or car. 

There has also been a significant change in the victim demographics in recent years. Now, more than 80 per cent of victims are in employment, albeit mostly part-time or on zero-hour contracts, compared to just 40 per cent pre-2022. 

For some people, it isn’t always obvious that lending money in this way is illegal or that they are victims of Loan Sharks. 

The woman we spoke to said she hadn’t realised that the man she was borrowing money from was a ‘Loan Shark’ and that what he was doing was a crime. She described how, in the early days, he seemed "kind" and "friendly" and "gained her trust".

"(He was) lovely, when I first started. I actually thought they were a friend," she explained.

"When I started saying I couldn't pay the amount I was paying, that was when things started to get a bit messy if you want to say….the threats then like the car, bailiffs things like that.”

She initially began by borrowing around a thousand pounds. 

Unbeknown to her, the interest he was charging ranged from thirty percent to a thousand percent. Soon the loan shark began taking every penny she had, including her child maintenance payment.  She said she was caught in a "spiral" of having to borrow more money from him to repay him what she owed. 

She said: “I'd tell him I don't have it and he wouldn't believe me so I'd send him screenshots of my bank but say there was £20 or £30 left in there he'd still want that so he'd take my last. I'd have to pay him whatever I had.

"I'd literally have nothing and then would have to go and borrow off friends and family then for essentials like bread, milk, nappies.”

The woman we spoke to said she hadn’t realised that the man she was borrowing money from was a ‘loan shark’. Credit: ITV Cymru Wales

She said she lived in "fear" and would forego paying other bills such as "council tax, rent, gas, electricity" just so she would have more to pay the loan shark and hopefully keep him away from her house and children.

Between the threats and being told by the loan shark that should anything happen to her, any debt would be passed to her children, she began to struggle with her mental health and could no longer work.

"I stopped leaving the house, I wouldn't go out anywhere," she added.

"I stopped going out with my friends. I literally stopped everything and it was just the anxiety that would sit with me like constantly I wouldn't sleep very well in the nights, nothing. It was just constant dread."

This went on for several years until she finally found the courage to report what was happening. She said it was a mix of emotions that kept her from doing so sooner. She described feeling "stupid" and "embarrassed".

She also said that despite everything the loan shark had put her through she felt she was "betraying him". 

However, after picking up the phone to Stop Loan Shark Wales she said she has not looked back. She has had support with all of her financial needs as well as housing. She said she feels complete "relief" at having broken the financial cycle she found herself in.

So what is a loan shark?

If you are worried that you, or someone you know, may be involved with a loan shark ask yourself the following:

  • Did they offer you a cash loan?

  • Did they not give you paperwork?

  • Did they add huge amounts of interest or APR to your loan?

  • Have they threatened you?

  • Are you scared of people finding out?

  • Have they taken your bank card, driving licence, passport, watch or other valuables from you?

If you can answer yes to one or more of the above you might be borrowing from a loan shark. You can find more help here on the Citizens Advice website and you can contact Stop Loan Sharks Wales.

Want a quick and expert briefing on the biggest news stories? Listen to our latest podcasts to find out What You Need To Know…