WAR ON THE USURER

Press, Volume XLIX, Issue 14758, 30 August 1913, Page 8

WAR ON THE USURER

THE TOUTING MONEY-LENDER IN ENGLAND. SOME FACTS ABOUT HIS TRADE. (from a corrf-sponivent. , * LONDON. July 31. No one who has lived long in London at what is known here as a "good address," can fail to be impressed by the fact that tho English aristocracy is the most philanthropic in the world. It is just burning to lend you money, without security and at a ridiculously low rate of interest. Hardly a post arrives without a letter offering any sum from £ 1 20 to £'25,000 on your note at hand alone, and if you happen to have a birth, or death, or engagement, or any other expensive emergency in the family, your lotter-box is fairly choked with missives on thick cream-laid crested paper bogging you to accept a small loan. If the Bill which has boon introduced in the House of Lords uy Lord Newton, and which has passed its second reading, becomes law. there will be a groat change in the signatures of these attractive letters. Lord Newton has set himself to deal with tho professional moneylending evil, one of the most difficult and persistent in England to-day; and tho method which lie lias adopted is publicity. His Bill would compel every money-lender to use his own name in all correspondence, and furthermore forbid him to send circulars to any one who had not asked for them. Newspaper advertising, under their own names, would be permitted to moneylenders.

The f-yil with which Lord Newton has sot himself to deal is one which has puzzled English l-nw-niaker.-s for generations. It is hn-rd to protect an adult fool from the oonsequenor-s of his foily, .and the minor i'ool is already protected.. It is ndmittwl, too, that the moneylender liiks a certain legitimate sphere. There aro plenty of people in good positions who aro sometimes ur'p;entlv in ni'cd of money, and to whom the'professional money-lender is a godsend. 'I hoy lravo no securities on winch they could money from their bankers, and thov do not 'care to borrow from tlioir friends. They r..re willing to pay high rates for tomp'orary awommodation, know perfectly well what thov are doing, and aro usually abio to dvivo a fair enough bargain. It is not such customers, however, that tho ton tin-: money-lender is keen on securing. The young man who needs money urgently to conceal an escapndo from his father, tho girl who has lost heavily at bridge and fears disgrace if sno dot's not pay, tho bank manager who has "borrowed" for a flier on ihe market that has gone wrong, and is faced with prison if ho cannot make good the deficiency— these aie the customers in whom the money-lender delights and whom he makes pay "through tho nose" for his services. Then the country clcn-'v-m.-ui ami tho widow or spinster in'a small town who find themselves temporarily embarrassed too often are caught by tho nlhirincr letters which aro sent broadcast, and sometimes fail to extricate themselves before they have repaid three, or four times th P sum borrowed. Were is an actual letter received the oWier day by a clergyman in Derby •— ' sir,—The fact that bankers are unwilling to allow one to overdraw their acoou-nt without security is what can only bo expected owing to the imsiness methods, on which banking is conducted. b

.Io those unablo to meet tho requirements of hankors T shall bo pleaded to advance cash in sums from £50 upwards for a short or Jong peri c<l at a special reduced interest to the clergy only without security. Jlooayinents by monthly or quarterly in.sta'ments or upon my oiv-n special system to suit clients own convenience — business completed by post. No interview is necessary Xo charge, of ,my description unless business actually completed "All communications absolutely , private and confidential. "It has become necessary +o state that my special reduced 'interest k quoted only to the clergy.—Yours faith-

. , , "J. MOSS." As a rule tho victims seldom dare to resist the lender's demands in the Courts, for that moans the exposure to avoid which was the reason for the loan. When they do the judges usually reduco tho claim to repayment of the principal and interest at'6o per oent per annum, holding that 60 per cent, is fair remuneration for the risk undertaken.

Even this, however, is taken advantage of by tho lenders while dealing with inexperienced people. How this is done was told to mc the other day by a London County Court iudgo who continually has suits against small borrowers in his Courts. Ho cited a typical example which came before him tho other day in which a small shopkeeper was tempted by an alluring letter to ar>ply for a loan. Tho circular stated that fifteen inonthlv payments of £1 13s -Id would nay off a bill or promissory note for ,£2.5. This looked, of course, like a philanthropic transaction, in which no interest was charged. When the time came for an interview, however, it was carefully explained to the borrower that he would only receive £17 for his note for £25, but that this deduction only represented about 30 per cent, interest on the loan, wliile the Courts allowed on ncr cent. Not being a financier the tradesman believed what was told him and concluded tho bargain.

"Now," said my friend the judge, "lot tfs sec what happens. The borrower has the use of £17 for one month only, at tho cud of which he nays £1 13s 4d. This loave.s £lo 6s Bd. of'which ho has the use for one month when a. second instalment reduced it to £13 13s -Id, and so on. When all theso sums arc added together wo find that he has had the us<* of £95 6s Sd for one month, which is equivalent to the wso of .C 7 19s for a year. But h<> ha-s paid £S for the accommodation, which, of course, works out at more than 100 per cent."

It :s said that the London moneylenders aro not content with alluring circulars to entrn.p their victims. There are said to be regular gangs working in the "West End clubs who fasten on a young and foolish son of wealthy parents, introduce him to a stage giri, who is well paid for her work j.s a <'(•- coy, and who runs him" heavily into debt for jewels, dresses, etc., w.i.oh'.'uc supplied by other members of the ganc. If possible, he is persuaded to gamole, and when he is at his wits' ond for money he is introduced to the pr'•■> cipal of tho gang, a nionpy-10-ndor. who, of course, drives a hn r d bargain. V'hon the young man hns finally reached tbo end of his tether, his fanr'ly usually pays up to save its honour. One of the most iniquitous phases of the money-lending cvi\ is what may bo termed the money-lenders' intelligence service. T know of a case in which a money-lender actually apnroachrd a bank manager and offered him a handsome commission if he would supnly th-? names of customers of the bank who had overdrawn their accounts or wpre in difficulties. In this cn.se the offer was indignantly refill, but thee can bo no doubt that in others it 3as tven accepted. The touting letters too ofl«n com* 1 at the psychological moment to be tho result of mere coincidwe.