Lending money to people without the licences and authorisations to do so is known as illegal money lending. These are sometimes referred to as ‘Loan Sharks.’
Those who borrow money from illegal money lenders are victims of crime.
If you have already borrowed from someone you believe is not licenced to lend, there is help and guidance available.
If you can answer yes to one or more of these questions, you may be borrowing from an illegal money lender:
- Were you given the amount you borrowed in cash?
- Were you not given any paperwork to confirm the terms and conditions of the loan?
- Will you have to pay back a significant amount more than you borrowed?
- Have you been threatened or are you fearful of the person or business you have borrowed from?
- Have any of your personal belongings been taken from you, for example a watch or other valuables?
- Have any of your identity documents been taken from you, for example your passport or bank card?
An illegal money lender will often deal in cash, not provide any paperwork, and will demand very high interest rates (or they may not be clear about what you have to pay back).
If you cannot make repayments, they may try to force you to do ‘favours’ for them, which may involve getting drawn into in criminal activity yourself. They may threaten violence or demand you give them valuable items instead.
Illegal money lenders often target people who believe they may struggle to borrow from well-known lenders such as high street banks. This may be because of a poor credit history or having low or no income.
Checking whether your lender is legal
All legal money lenders in the UK must be authorised by the Financial Conduct Authority (FCA).
You can search the FCA Register to check the person or business you are thinking of borrowing from is registered.
Reporting illegal money lenders or ‘loan sharks’
There are specialist teams in Great Britain and Northern Ireland that are there to help.
If you live in Great Britain (England, Scotland or Wales)
Stop Loan Sharks investigate and prosecute illegal money lenders and provide support to victims. If you have borrowed from a loan shark or are worried about someone else, they are there to help. They have specially trained staff that can provide emotional and practical support.
You can also contact by calling 0300 555 2222. They are available 24/7.
You can remain anonymous, and any information you provide will be thoroughly investigated and treated in the strictest confidence.
Stop Loan Sharks will ask for your name and contact details, but you do not have to provide them. By providing your contact details, Stop Loan Sharks will be able to fully investigate the loan shark and keep you informed on the case.
If you live in Northern Ireland
Report loan sharks to the Police Service of Northern Ireland who will investigate and prosecute.
You can also contact them on the non-emergency line by calling 101 or anonymously contact Crimestoppers by calling 0800 555 111.
Emergency situations
If you feel you are in immediate danger you should call 999.
Help if you are struggling
People may look to borrow money from loan sharks if they feel that they have no other options. There are sources of advice and support that can be used to help with household budgeting, financial difficulties, or debts that you are struggling to manage.
MoneyHelper offer advice and guides to help improve your finances and provide tools and calculators to help you keep track and plan ahead. They can offer support in person, over the phone and online.
You may also find useful information by visiting our Support during financial difficulties and Managing your money pages.