DECISION UNDER DELEGATED POWERS

Transcription

1 01/10 DECISION UNDER DELEGATED POWERS DECISION CANNOT BE TAKEN BEFORE MONDAY, 25 JANUARY 2010 Title Reprt t the: AUTHORISATION OF ILLEGAL MONEY LENDING TEAM TO INVESTIGATE AND INSTITUTE PROCEEDINGS AGAINST ILLEGAL MONEY LENDERS OPERATING ON THE ISLE OF WIGHT CABINET MEMBER FOR FIRE AND COMMUNITY SAFETY PURPOSE 1. This reprt seeks apprval fr the Isle f Wight Cuncil t authrise Birmingham City Cuncil t investigate and institute prceedings against illegal mneylenders perating within the Isle f Wight Cuncil area. OUTCOMES 2. Delegatin f pwers t enfrce the law n illegal mney lending t the Birmingham City Cuncil s Illegal Mney Lending Team wuld give access t a highly expert and specialised resurce that wuld nt be available t the area by any ther means. 3. T have an Illegal Mney Lending Team perating n the Isle f Wight wuld be a majr benefit t vulnerable peple wh may find themselves subject t the criminal activities f lan sharks. It als cntributes t the wider crime and disrder agenda. BACKGROUND 4. Illegal mneylenders, r lan sharks, are thse wh lend mney t peple and d nt have a licence t d s. Lan sharks prey n sme f the mst vulnerable peple in sciety. Far frm helping peple, lan sharks tend t create and exacerbate a cycle f debt. At a time f ecnmic dwnturn there are greater pprtunities fr lan sharks. It has always prved very difficult t bring them t justice. 5. A lan frm an illegal mneylender is, n average, three times the cst f the same lan frm smene perating legally. Interest rates are ften extrtinate and sme lan sharks will stp at nthing t cllect dues frm victims, r t demnstrate their pwer within cmmunities. Lan shark activity is characterised by deliberate criminal fraud and brrwers can face demands fr thusands f punds mre that 1

2 they riginally brrwed. Brrwers wh refuse r fail t pay can be subjected t intimidatin, theft and physical vilence. 6. Lan sharks d nt respect lcal authrity bundaries and seldm restrict their criminal activities nly t illegal mney lending. 7. The Cnsumer Credit Act 1974 is the primary legislatin gverning the Credit Industry. The Act is based upn a licensing system and all cnsumer credit businesses must pssess a Cnsumer Credit Licence issued by the Office f Fair Trading. T btain a licence an applicant must demnstrate that they are a fit and prper persn t perate a credit business. All persns perating credit businesses must cmply with cmprehensive regulatins abut the cnduct f their business. Regulatins cver all aspects f the business and include requirements n advertising, frm f agreements and the supply f infrmatin. A mneylender wh was nt licensed wuld be acting illegally, as wuld a licensed mneylender wh did nt cmply with the ther requirements f the credit legislatin. 8. It is the duty f each lcal weights and measures authrity i.e. the Trading Standards Service, t enfrce the prvisins f the Cnsumer Credit Act within their lcal authrity bundary. 9. The Isle f Wight Trading Standards Service is able t deal with rutine advice and enfrcement under cnsumer credit legislatin. Enfrcement f the law in respect f illegal mney lending, hwever, is nt a practical prpsitin fr the majrity f Trading Standards Services. Investigatin f illegal mney lending is a specialist activity and is very resurce intensive. Often investigatins will reveal evidence f ther illegal activity and may invlve ther agencies. Additinally victims require specialist handling and supprt. Until the intrductin f the Illegal Mney Lending Teams this was an aspect f trading standards wrk that had nt been addressed ver mst f the cuntry. 10. Gvernment (Department fr Business, Innvatin and Skills, frmerly Department fr Business, Enterprise and Regulatry Refrm) recgnised that a different apprach was needed in respect f enfrcement arund illegal mney lending. Initially, in 2004, funding was made available under the Illegal Mney Lending Prject fr pilt reginal specialist teams t be set up in Glasgw and Birmingham. The teams were spectacularly successful in cmbating illegal mney lending in thse areas. Since 2004, further funding has been made available t expand the pilt int several ther high need areas. 2007/08 saw the prject rlled ut thrughut England and it was annunced in December 2007 that BERR wuld cntinue t fund an illegal mney lending team in every regin in Great Britain until March The Illegal Mney Lending Teams riginally targeted their activity in the areas identified in research as areas where the incidence f illegal mney lending activity was likely t be particularly high. In the Suth East thse areas were Prtsmuth, Suthamptn and Hastings. Hwever, criminals d nt respect administrative brders and intelligence and the publicity that the Lan Shark initiative has generated has resulted in the team nw wrking ver a much wider area. All f the Trading Standards Authrities brdering the Isle f Wight, tgether with many thers in the Suth East, are nw actively cvered by the Lan Shark initiative. The Illegal Mney Lending Team cvering the Suth East is perated by the Trading Standards Service f Birmingham City Cuncil. This team was ne f the riginal pilt teams. 2

3 12. S far, the Illegal Mney Lending Teams have successfully prsecuted mre than 60 peple natinally with a further 90 prsecutins underway. Custdial sentences fr illegal lending and assciated crimes ttal ver 50 years. The teams have saved arund 30 millin fr cnsumers wh were lcked int deals with illegal mneylenders. 13. The teams d nt restrict their activity t simply prsecuting ffenders. The Illegal Mney Lending Team will help victims f illegal mneylenders with practical help and supprt. The team ffers mney management help t all victims f mneylenders wh cntact them fr advice and assistance. It is ne f the aims f the teams t create a climate where victims can cme frward, cnfident that prsecutins will be undertaken and cnvictins btained, withut fear f reprisals. S far, mre than 10,000 victims f illegal mney lending have been helped. 14. This is a highly specialised area f activity requiring specialist resurce, expertise techniques and facilities that mst Trading Standards Services culd nt prvide. Members f the Illegal Mney Lending Team include fficers with high-level training and expertise and includes, amngst thers, ex plice fficers and security services persnnel. 15. If evidence cmes t light f illegal mney lending activity ccurring n the Island, the Isle f Wight Trading Standards Service wuld be ill equipped t deal with it withut the specialist services f an Illegal Mney Lending Team. 16. Publicity is a key element f the Illegal Mney lending Teams and when a team starts t perate in an area there is nrmally a high prfile launch. 17. A natinal cntact telephne number, tgether with text/sms number and address is available t reprt illegal mney lending and fr victims t seek supprt. These are supprted by natinal publicity. 18. As previusly mentined (at 8. abve) it is the duty f this Authrity t enfrce the prvisins f the Cnsumer Credit Act 1974 in this area. This is an executive functin fr the purpses f the Lcal Gvernment Act 2000 and assciated legislatin. Fr the Illegal Mney Lending Team f Birmingham City Cuncil t perate n the Isle f Wight it will be necessary t frmally delegate pwer t enfrce the prvisins f Part III f the Cnsumer Credit Act It is necessary fr Birmingham City Cuncil t be satisfied that the delegatin is rbust and prperly executed. 19. In rder t ensure clarity in respect f the peratin f these arrangements, the attached draft prtcl sets ut the prcesses and practices t enable Birmingham City Cuncil and its fficers t undertake investigatins and legal prcedures. 20. This delegatin wuld nt interfere with the duty f the Isle f Wight Cuncil Trading Standards Service frm undertaking the enfrcement f the full range f Cnsumer Credit legislatin. 21. It is prpsed that the delegatin will cntinue until 31 st March 2011 with a view t extending the arrangement if successful and assuming cntinued direct gvernment funding t the reginal teams is available. 3

4 STRATEGIC CONTEXT 22. The recmmendatin will cntribute t the fllwing crprate themes and utcmes: A Safe and Well Kept Island Reduce crime and the fear f crime A Healthy and Supprtive Island Imprve emtinal health Supprt vulnerable peple Delivering Better Services Enhance the Cuncil s reputatin. Imprve perfrmance and value fr mney. Wrk cnsistently and chesively with partners. Priritise and ratinalise resurces. CONSULTATION 23. There has been cnsultatin with ther Lcal Authrities and the Trading Standards reginal gruping rganisatin, TSSE (Trading Standards Suth East). All f ur neighburing authrities have already agreed that the Illegal Mney Lending Team may perate in their areas and have entered int similar arrangements t thse set ut in this reprt. It is a duty f the Isle f Wight Cuncil t enfrce the prvisins f the Cnsumer Credit Act 1974 and this decisin is nly required t prvide a means f enfrcing a part f the Act that wuld therwise nt be practicable. It is an peratinal issue rather than ne f plicy. FINANCIAL / BUDGET IMPLICATIONS 24. There are n financial implicatins fr the Isle f Wight Cuncil as a result f this prpsal. All majr csts will be funded by the Treasury directly, t Birmingham City Cuncil. It may be necessary in very infrequent circumstances t prvide a wrk base fr fficers perating n the Island, but this wuld have n mnetary value and wuld be prvided in kind within the existing Trading Standards Service facilities. LEGAL IMPLICATIONS 25. By virtue f Sectin 161 f the Cnsumer Credit Act 1974 it is the duty f each lcal weights and measures authrity t enfrce the prvisins f the Act within their lcal authrity bundary. This is an executive functin fr the purpses f the Lcal Gvernment Act 2000 and the Lcal Authrities (Functins and Respnsibilities)(England) Regulatins It is, therefre, necessary fr the Cuncil, in this case by means f a delegated decisin f the Cabinet Member, t frmally delegate this functin t Birmingham City Cuncil under Sectin 13(7) f the Lcal Gvernment Act 2000 and the Lcal Authrities (Arrangements fr the 4

5 Discharge f Functins)(England) Regulatins Birmingham City Cuncil is als required t frmally accept the delegatin. 26. Birmingham City Cuncil will undertake any prsecutins with n liability fr csts fr the Isle f Wight Cuncil. EQUALITY AND DIVERSITY 27. This is a technical issue that des n mre than extend the ability f the cuncil t effectively enfrce a part f the Cnsumer Credit Act Hwever, it is ften the prer and mre vulnerable members f sciety wh becme victims f illegal mneylenders and find it difficult t access apprpriate supprt and help. This includes members f ur diverse cmmunity. The effect f this decisin will be t seek t address this. 28. An Equality Impact Assessment has been cmpleted. In summary the assessment fund that all parts f the cmmunity and all grups f residents will benefit frm the available access t the service f the Illegal Mney Lending Team and that n actin plan was required. OPTIONS 29. Optin 1. D nthing. The effect f this wuld be t deprive the Island cmmunity, particularly thse wh may becme victims f lan sharks, f the pprtunity f bringing these criminals t justice and supprt with the assciated quality f life issues. There are n viable alternatives fr prviding the facility, ther than that set ut in Optin Optin 2. With effect frm 1 st February 2010, that the Isle f Wight Cuncil agree that the discharge f its functin f the enfrcement f Part III f the Cnsumer Credit Act 1974 be carried ut n the Isle f Wight by Birmingham City Cuncil (pursuant t Sectin 101 f the Lcal Gvernment Act 1972, Regulatin 7 f the Lcal Authrity (Arrangements fr Discharge f Functins)(England) Regulatins 2000 and Sectin 13(7) f the Lcal Gvernment Act 2000). Additinally that the attached Draft Prtcl fr Illegal Mney Lending Team Investigatins be agreed and authrity be delegated t the Trading Standards Manager t enter int the agreement n behalf f the Isle f Wight Cuncil and apprve minr alteratins if required. RISK MANAGEMENT 31. The risk in adpting this partnership apprach by giving delegated pwers t Birmingham City Cuncil is very lw. The ther authrity, which is the emplyer f the fficers within the Illegal Mney Lending Team, wuld carry any risk that culd arise. Birmingham City Cuncil wuld undertake any investigatins and prsecutins with n liability fr csts fr the Isle f Wight Cuncil. 32. There are n reputatinal risks t the Isle f Wight Cuncil by adpting this apprach. It is likely that there wuld be a greater risk if the apprach was nt adpted and it later came t light that a lan shark was perating in the area and the Cuncil had nt taken the pprtunity f implementing the means t deal with it. 5

6 EVALUATION 33. Delegatin f pwers t enfrce the law n illegal mney lending t the Illegal Mney Lending Team wuld give access t a highly expert and specialised resurce that wuld nt therwise be available. 34. T have an Illegal Mney Lending Team perating n the Isle f Wight wuld be a majr benefit t vulnerable peple wh may be subject t the criminal activities f lan sharks and, f curse, t the wider crime and disrder agenda. RECOMMENDATION 35. With effect frm 1 st February 2010, that the Isle f Wight Cuncil agree that the discharge f its functin f the enfrcement f Part III f the Cnsumer Credit Act 1974 be carried ut n the Isle f Wight by Birmingham City Cuncil (pursuant t Sectin 101 f the Lcal Gvernment Act 1972, Regulatin 7 f the Lcal Authrity (Arrangements fr Discharge f Functins)(England) Regulatins 2000 and Sectin 13(7) f the Lcal Gvernment Act 2000). Additinally that the attached Draft Prtcl fr Illegal Mney Lending Team Investigatins be agreed and authrity be delegated t the Trading Standards Manager t enter int the agreement n behalf f the Isle f Wight Cuncil and apprve minr alteratins if required. (By this means The Isle f Wight Cuncil authrise Birmingham City Cuncil t investigate and institute prceedings against illegal mneylenders perating within the Isle f Wight Cuncil area and t prvide and manage suitable supprt mechanisms) APPENDICES ATTACHED 36. APPENDIX - Draft Prtcl fr Illegal Mney Lending Team Investigatins. BACKGROUND PAPERS 37. Nne Cntact Pint: Richard Stne, Trading Standards Manager, Ext [email protected] MR STUART LOVE Directr f Envirnment and Neighburhds COUNCILLOR BARRY ABRAHAM Cabinet Member fr Fire and Cmmunity Safety Decisin Signed Date 6