Thus, violence was an important tool, though not their only one. I think it's fair to say that he's moved past desperation and is now up to exploitation You're a hypocrite if you don't display anger over the exorbitant student loans given freely to young and vulnerable people every single day. See Wikipedia's guide to writing better articles for suggestions. MP shocked by 'legal loan shark' school involvement". A fair odds bet:
These loan sharks operated more informally than salary lenders, which meant more discretion for the lender and less paperwork and bureaucracy for the customer.
They were also willing to serve high-risk borrowers that legal lenders wouldn't touch. Threats of violence were rarely followed through, however. One possible reason is that injuring a borrower could have meant he couldn't work and thus could never pay off his debt. Many regular borrowers realized the threats were mostly bluffs and that they could get away with delinquent payments. A more certain consequence was that the delinquent borrower would be cut off from future loans, which was serious for those who regularly relied on loan sharks.
One important market for violent loan sharks was illegal gambling operators, who couldn't expose themselves to the law to collect debts legally. They cooperated with loan sharks to supply credit and collect payments from their punters. Thieves and other criminals, whose fortunes were frequently in flux, were also served, and these connections also allowed the loan sharks to operate as fences.
Violent loansharking was typically run by criminal syndicates, such as the Mafia. Many of these were former bootleggers who needed a new line of work after the end of Prohibition. Towards the s, loan sharks grew ever more coordinated, and could pool information on borrowers to better size up risks and ensure a borrower did not try to pay off one loan by borrowing from another loan shark.
The fearsome reputation of the Mafia or similar large gang made the loan shark's threat of violence more credible. Although the reform law was intended to starve the loan sharks into extinction, this species of predatory lender thrived and evolved. After high-rate salary lending was outlawed, some bootleg vendors recast the product as "salary buying". They claimed they were not making loans but were purchasing future wages at a discount. This form of loansharking proliferated through the s and into the s until a new draft of the Uniform Small Loan Law closed the loophole through which the salary buyers had slipped.
Organized crime began to enter the cash advance business in the s, after high-rate lending was criminalized by the Uniform Small Loan Law. The first reports of mob loansharking surfaced in New York City in , and for 15 years, underworld money lending was apparently restricted to that city.
In the beginning, underworld loansharking was a small loan business, catering to the same populations served by the salary lenders and buyers. Those who turned to the bootleg lenders could not get credit at the licensed companies because their incomes were too low or they were deemed poor risks.
The firms operating within the usury cap turned away roughly half of all applicants and tended to make larger loans to married men with steady jobs and decent incomes.
Since the mob loans were not usually secured with legal instruments, debtors pledged their bodies as collateral. In its early phase, a large fraction of mob loansharking consisted of payday lending. Many of the customers were office clerks and factory hands. The waterfront in Brooklyn was another site of extensive underworld payday advance operations around mid-century. Over time, mob loan sharks moved away from such labor intensive rackets.
By the s, the preferred clientele was small and medium-sized businesses. Business customers had the advantage of possessing assets that could be seized in case of default, or used to engage in fraud or to launder money. Gamblers were another lucrative market, as were other criminals who needed financing for their operations.
By the s, mob salary lending operations seemed to have withered away in the United States. At its height in the s, underworld loansharking was estimated to be the second most lucrative franchise of organized crime in the United States after illegal gambling. Newspapers in the s were filled with sensational stories of debtors beaten, harassed, and sometimes murdered by mob loan sharks.
Yet careful studies of the business have raised doubts about the frequency with which violence was employed in practice. Relations between creditor and debtor could be amicable, even when the " vig " or "juice" was exorbitant, because each needed the other. FBI agents in one city interviewed customers of a mob loan business but turned up only one debtor who had been threatened. None had been beaten. Organized crime has never had a monopoly on black market lending. Plenty of vest-pocket lenders operated outside the jurisdiction of organized crime, charging usurious rates of interest for cash advances.
These informal networks of credit rarely came to the attention of the authorities but flourished in populations not served by licensed lenders. Even today, after the rise of corporate payday lending in the United States, unlicensed loan sharks continue to operate in immigrant enclaves and low-income neighborhoods.
They lend money to people who work in the informal sector or who are deemed to be too risky even by the check-cashing creditors. Some beat delinquents while others seize assets instead.
USA has a loan shark law, the maximum rate is set. Roman University Law was or is tied to usury laws for most of European legal history. Beyond that, more recently, USA has maximum rates for credit lenders and for 1st and 2nd mortage lenders and auto loans too.
In modern times it was said "you can't get a loan unless you don't need the money", however recently the legal focus has been in preventing lending by institutions who know the persons will fail to pay - a thing called "predatory lending" which is a different topic.
The research by the government and other agencies estimates that , to , people are indebted to loan sharks in the United Kingdom. Illicit loan sharking is treated as a high-level crime by law enforcement, due to its links to organized crime and the serious violence involved. The Central Bank of Ireland were criticized by  for doing nothing to protect those on low incomes, the vulnerable or have low levels of financial literacy from loan sharks when it emerged that up to , of the , loans given by moneylenders broke the law.
In the United States, there are lenders licensed to serve borrowers who cannot qualify for standard loans from mainstream sources. These smaller, non-standard lenders often operate in cash, whereas mainstream lenders increasingly operate only electronically and will not serve borrowers who do not have bank accounts.
Terms such as sub-prime lending ,  "non-standard consumer credit" [ citation needed ] , and payday loans are often used in connection with this type of consumer finance. The availability of these services has made illegal, exploitative loan sharks rarer, but these legal lenders have also been accused of behaving in an exploitative manner.
By claiming to be charging for the "service" of cashing a paycheck, instead of merely charging interest for a short-term loan, laws that strictly regulate moneylending costs can be effectively bypassed. Licensed payday advance businesses, which lend money at high rates of interest on the security of a postdated check, are often described as loan sharks by their critics due to high interest rates that trap debtors, stopping short of illegal lending and violent collection practices.
Today's payday loan is a close cousin of the early 20th century salary loan, the product to which the "shark" epithet was originally applied, but they are now legalised in some states. A comparison of short-term lending rates charged by the Chicago Outfit organized crime syndicate and payday lenders in California revealed that, depending on when a payday loan was paid back by a borrower generally 1—14 days , the interest rate charged for a payday loan could be considerably higher than the interest rate of a similar loan made by the organized crime syndicate.
The regulation of moneylenders is typically much looser than that of banks. In Japan, the Moneylending Control Law requires only registration in each prefecture. In Japan, as the decades-long depression lingers, banks are reluctant to spare money and regulation becomes tighter, illegal moneylending has become a social issue. They lend money to people who are unable to obtain loans from banks or other legal sources, mostly targeting habitual gamblers.
Often, they discreetly advertise by sticking notices, mostly on lamp posts and utility boxes around a neighbourhood, thus vandalising public property, as authorities must remove such advertisements. When a person fails to pay on time, the Ah Long will set fire, spray paint, splash, or write threats in paint or markers on the walls of the property of that person as a threat of violence and to scare, and perhaps shame, the borrower into repaying the loan.
According to local police authorities, there have been cases where borrowers and their family members were beaten or had their property damaged or destroyed, and some victims have committed suicide.
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Not only cars but we found that it isthe easiest to deal with unlike cellphones or jewellery which might be fake. Also while we have the car in our possession we have them rented out woth drivers at a far lower price than anyone else in the city.
We dont have a minimum we lend to anyone who has a collateral which can be useful to us. Have you ever had a a renter crash a car, if so how did you handle it? I assume the renters are completely liable in such an event?
Yup it has happened. I make them pay for the repairs and have my mechanic fix up the car but those are rare since i usually assign them a driver. So if I wanted to rent a car from a guy like you how would I go about that? Head over to the casino, find a runner, and ask for some contacts? Nope thats all based on word of mouth. The client doesnt even know that we are having his car rented out.
Generally my clients are foreign tourists who want to rent a car and have a good time. I love all the indignation here. I'm sure many of the same people who are hemming and hawing about morality would be thrilled if Sheldon Adelson wanted to do an ama here, but when you strip away the glitz and glamour that makes his business sexy it exploits the same sorry victims and addicts on a grander scale.
Too much debate over whether or not this is entrepreneurship-it clearly is-and despite the fact that I have no respect for it I think actual insight into how an industry works is good for this subreddit. I think people see the words "loan shark" and automatically associate that with kneecap busting gangsters. He is operating no differently than a pawn broker would. The only thing I find questionable is having runners and casino staff directly solicit the loans. There is an argument to be made they wouldn't have chosen to take a loan unless solicited.
So it's a little different than people seeking his services, which I'm sure still happens, but he is seeking out the troubled people. Smart for business though. Fuck all these comments that say "I respect the hustle," etc. This is not entrepreneurship, this is opportunistically taking advantage of idiots in a bad situation. I see no justification for destroying people's lives to make quick money. Sure, the money's good, and people make their own choices, but what you're doing is awful, and your justification for it doesn't make it less awful.
Stop being a predator, use your intelligence and hustle to do something good for yourself without fucking other people over. It's a grey area thing. But he's an adult loaning other adults money. Banks are all predatory lenders, sending credit cards to high risk debtors routinely. Their game is much more refined though, instead of runners they use FICO score. I am new to the sub. Is it just "people who make money in various ways" or entrepreneurs? I mean, drug dealers are entrepreneurs as well as outlaw motorcycle gangs.
It's interesting but I don't know if it's much of a business option for most countries - "well, uhh, we kidnap people and if families don't pay, we chop off their arms and legs and dump them in a ditch" is not a great startup. This type of post is definitely out of the ordinary for this sub.
That might be better suit what you're looking for. I've never seen any biker gangs on smallbusiness- but the ones that fund businesses around me would definitely have an interesting story. I see your point but at the same time I have to admit it's intriguing. There's not enough of these kinds of posts to be a nuisance so if you're really put off by it just don't read this thread.
Personally I enjoy windows into the obscurities of other peoples unusual lives and this is no exception. Plus, where else would he post this?
This sub is one of the logical choices. I am not particularly offput. I found it interesting the number of people commenting on "good hustle". This is more of an insight into the industry post. I would not recommend anyone to do this.
First of all because of its legality and because it takes a specia kind of person to do this. I would hate to be one of your clients after you become a lawyer if you are shady enough to do this already. Ugh you're such garbage that you didn't go to an Ivy League school and start your own business with start up money from your trust fund..
People need to stop crying, business is business. I've been in liquor stores of the slums of Delhi packed with alcoholics, would you respect that guy as a "small business owner". Vice is a real think and people will always profit off of it, if that bothers you keep it moving. There's a difference between selling a vice, and actively seeking out people clearly in a bad place because of said vice.
The right analogy would be "Do you respect the guy who opens a mega discount liquor shop next to the AA building" or sells needles outside a drug clinic. That would be a better analogy, but if he doesn't do it he'll create a vacuum and someone else will.
Gambling is illegal in the US, but myself and most of my social circle still have a bookie. It's always going to be around, some people enjoy that lifestyle and if they do and they decide to hock their car in a shitty business agreement that's on them. He works with sober adults and it's their decision. The extent everyone is going to in order to justify this is insane. The same argument can be made for any terrible thing someone does.
The hitman can say "Well, if I don't kill this guy, they'll just hire someone else to do it, so I might as well. That doesn't make his decision to take advantage of people less shitty. You guys all need some intense self reflection on what you're willing to do, or advocate accepting, in the name of money.
Killing someone is universally illegal.. What he is doing is not. Obviously it's in a gray area morally, but if a consenting adult agrees to it I don't see the problem. While prostitution and drugs are generally illegal, to me it's a similar situation.
I might not necessarily agree, but I don't think it's my business what the private transactions between two consenting adults are. I understand the point you're trying to make but it's not for you to judge. The gambling addict, the alcoholic, the compulsive shopper and the drug addicts all get to make choices that are right for them in those moments. You're a hypocrite if you're not just as angry at the credit card companies who offer credit beyond an individual's means to repay.
You're a hypocrite if you don't display anger over the exorbitant student loans given freely to young and vulnerable people every single day. People are going to do whatever the fuck they want to do, whether YOU are morally outraged or not. Nice read and thanks for sharing your story. No hate on the jobj or the moral part from me either as I see you as just another guy who took the opportunity to feed yourself. Are you originally from the country your working in?
Why don't you try to move to a wealthier country where you could circulate more money, thus upping your income? What is your yearly revenue and what are you left with at the end of the year?
Anyways i tend to deal with vip players who are willing to borrow large amounts sometimes a little more than im comfortable with. Very interesting,no judgement from me, I don't know your circumstances of how thing work in your country.
Your method seems better and smarter than the "breaking kneecaps" approach,although I am sure violence is never far in that industry either way.
Good for you for wanting to transition out it and getting into something more legit. Lol OP I love your gall for posting this. Half the bullshit businesses posted to this sub make me shake my head.
I worked in the payday loan lead gen space and quit for ethical reasons but I don't look down on anyone still in that space or the loan shark business. Business is Business and you can learn something from people who are successful in a variety of industries. A large scale drug trafficker is probably better at negotiations and navigating complex hostile organizational structures than you ever will be with your fucking subscription box.
This sub needs to get off its high horse. That's a very interesting post, thanks for sharing. I dont lend to anyone i know. I dont like getting to know the person and the less time i spend with the client the better. I do feel guilty sometimes when they cant pay. For all the hate this guy is getting, what is the moral difference between this man and the owner of a corner store that sells cigarettes to nicotine addicts?
His loan won't give someone lung cancer and eventually kill them after all. Alternatively, it's similar to a pawn shop, which are legal in the US. There is a casino in my town, and also a pawn shop.
You will find a lot of pawn shops near casinos in every part of this country. Whether people need money to gamble or pay rent, they have the option of pawning their belongings for a significantly lower price than the market value. Those numbers aren't all that much different from what this guys numbers are.
The only morally questionable thing this guy is doing is having runners and casino staff soliciting loans. Essentially preying on the troubled. While these people may have sold off or exchanged their property for a loan anyways, there is an argument to be made that they wouldn't have chosen to make those choices unless solicited directly.
It's like a drug addict trying to get clean after an overdose, yeah they're likely to use again anyway, but having dealers seek them out to sell them drugs makes their chances for recovery tremendously lower and is morally wrong. I see this guy getting a lot of hate, which I think is wrong.
People read the words "loan shark" and automatically associate that with kneecap busting gangsters, while in reality it's much closer with a pawn broker. What he is doing is legal in his country, so he is not acting outside of the law, he is not physically harming individuals, and he gives realistic figures for repayment.
He should definitely be criticised for his business practices, but I don't think he should be hated. You may get some hate for being a bottom feeder, but you're not twisting anyone's arms To hell with that, you saw an opportunity and went for it.
Well i was expecting a lot of hate since it is a business that ruins a person's life but i could not resist the opportunity. No i dont have a bodyguard but i do carry my pistol with me wherever I go and i practice about twice a month with my military buddy who trains me.
Whenever i check a car i bring my friend with me who also carries and his job is to make sure no one shoots me in the back. A fool and his money are soon parted. I wouldn't feel bad at all. They're the idiots for agreeing to your terms at their disadvantage.
You can't really blame them since they are addicted to gambling. But i do get the rare case where someone wants to borrow money from me because it takes too much time to go through the bank, those deals even baffle me. Specially since thise people don't gamble. How much money do you typically loan out? I'm sure it varies wildly but is there an average amount? Lol not really since we work together sometimes he checks the carwhile i say watch. But in the rough sense yes he is my bodyguard.
Haha yeah I know, I was just busting your balls. By providing them with the funds they've determined they need very much? If anyones life "gets ruined", it would only be because of their poor financial decision making. Most of this people are sick, they have an addictive disorder they can not control. I would love to hear some arguments from the people downvoting. Please read the Wikipedia page listed if you don't trust Wikipedia, follow its sources.
From a moral point of view it's hard to judge - I mean, if the choice is between something like this and living on the street there's not really much choice at all Although he did have 15k to start-up with so I'm wondering exactly how dire his straits were. I think it's fair to say that he's moved past desperation and is now up to exploitation I plan on using that money to go to law school and start another business on the side.
This time more legit. Just to be clear, I do not agree with what you do, but I understand that not everything is black and white. So when being a loan shark no longer satisfies your cravings for evil you can graduate to being a lawyer? Yeah but we aren't rioting against liquor stores selli to drunks or big tobacco selling to smokers. How did you get started? And how would you suggest someone with little capital gets started? And also with regards to lawyers etc, do you hire them or debtcollectors?
First i would double check with all the laws in your country. Then set a budget that you are willing to invest and do not go over that budget no matter what.
It is easy to lose track of your money if you dont budget it. Then try to find someone who can help you out if you can go to the local casino and talk to the floor supervisor and let him know what you want to do he might even refer you to some runners. It's a first come first serve basis. The lawyer on the other hand is just a regulard lawyer who is my friend who i pay a normal notarizing fee. Its quite common here to be able to notarize a contract without both parties present.
Lets lst you borrow k on your home thats worth 1m. Once you cant pay ill sell the home to someone for around or k. Real estate companies love those deals here. After the borrower failed to pay, the property is now owned by the loaner. All the money goes to him. S relies too much on people financing their homes.
Most people purchase their homes in cash in most countries. If you acquire a house for a third of what it's worth and offer it for half of the market value, you'll probably sell it pretty quickly.
Are you connected or competing against any mafia? If so, how do you stay safe? This is very interesting, thanks a lot for sharing! In the capital the mafia rules the land but in the rural places where i live i dont hear anything about them. You are not a loan shark. You're a title loan center that delivers. And we all know, or should know, that title loan centers are one of the biggest and most damaging bottom-feeders of the American economy. This isn't entrepreneurship, this is douchebaggery.
And it's certainly not loan sharking. Don't get too big for your shitkicking britches, buddy. I guess you are unfamiliar with the histories of most of the wealthiest and most powerful people on our planet. He's not causing hurt though. If he didn't offer his service, the impulsive gamblers would just find someone else to do it. These impulsive gamblers have problems but not the kind of problems that just disappear on their own, and not ones you can really intervene in.
The kinds of gamblers that are going to give up their car as collateral and pay 2 points a day are the ones that already spent their rent and food money. It takes a gambler to hit rock bottom and be out on their ass living under a bridge with no vehicle or home to sometimes finally realize that they need to change their life.
Just because someone else would be there to cause the damage rather than him does not negate the fact that he is causing damage. Claiming "someone else would do it anyway" does not morally absolve you from your actions. He doesn't "cause" anything. What is preventing these idiots from going to a pawnshop to get a vastly better interest rate? These people are willing to pay extra to get the money quickly and more conveniently. Are the people at the venue immoral and damaging?
If you think gamblers are unable to make rational decisions, then the problem is legal gambling venues, not this guy! Can you explain exactly how he's "creating damage"? Is it because he's making a profit on the deal? His "product" doesn't directly kill the user. His "product" doesn't chemically addict them either. Not even as destructive as selling motor vehicles, which kill an average of people each and every day, with thousands more being critically injured. That is real death and destruction.
Well what i do is legal here and we clearly have a different point of view in life. Im sorry if this thread offended you. Just here to give an insight into the industry. The morals of this are a little hazy honestly. Don't get me wrong, this is way to icky for me to get into. But really, lets say you start a maid business in a small market, you undercut "the competition", you use technology better, and you are successful.
When we go into a market, we are directly competing against other peoples livelihoods. Now, it's up to you personally how you draw the line. But I can definitely see why if somethings legal or even legalish , why a large majority of the people here are okay with it. There's a difference in my mind between out-competing someone in the marketplace and actively hurting your customer, especially if your customer is someone who doesn't have full decision-making powers.
I don't know enough to say whether gambling is an "addiction" or not, but I do know casinos change the brain chemistry of people such that they make terrible decisions. Competition in a market is broadly for the public good. You get some maid business, people get their houses cleaned more often and more cheaply, and the couple either finds something else to do where they have an advantage or figures out how to undercut you customers benefit or falls on the social safety net which has been boosted slightly by people spending less time cleaning their own houses and more time doing whatever they're good at.
Loan sharks are different. This isn't even something like selling alcohol where you know some fraction of your customers are being seriously hurt but most are responsible. The vast majority of his customers are people who are being vastly self-destructive and probably hurting their families , and who wouldn't have been able to hurt themselves as badly had he not been there. Is it better to be competing against someone and hurt them, or to hurt someone who willingly accepts it? Like i said we have a piece of paper that says how much he borrowed and the percentage etc and his signature.
Technically it is a legally binding contract but it takes forever here to go through the court system to forclose something. So we just process the open deed of sale which take about 2 week andnonly costs a fraction compared to a formal forclosure. No judgement here, everybody has to eat.