Loan sharks are a menace to society. They have no scruples. They prey on the weak and the desperate for money. They exploit the young to do their dirty work for them. Their chief weapons are intimidation, shame and violence. They think nothing of harassing and destroying the property, not only of their debtors, but their innocent neighbours. They will vandalise houses even when the debtor is no longer living there, proving that not only are they nasty, they are also not very clever. Indeed, to call them sharks is an insult to those fine creatures of the ocean. May I suggest cockroaches instead?
I therefore support amendments which will give the police more teeth to rout this growing menace. From January to September 2009, there were 13,771 reported complaints; compared with 11,789 for the whole of 2008. It was even lower in 2007. So this is a growing problem. We obviously need greater deterrents. I therefore support increasing the punishment for carrying out or assisting in the carrying out of illegal money-lending activities.
But as we all know, the real culprits are the kingpins, not the riff raff who do the running for them. For every runner we arrest, another takes his place. I therefore welcome the new measures to deal with the procurement of minors to carry out illegal activities. Likewise, the new power to freeze funds that the police believe to be related to loan-sharking activities. By this, we can hit the syndicates where it really hurts. To trace and uncover such funds may be difficult, but it is certainly worth trying. This may however cause hardship to innocent individuals and family members who depend on them. Could the Minister therefore assure this House that this weapon will only be deployed in clear cases, and that where funds are frozen, the police will expedite their investigations to minimise prejudice?
There have been calls to prosecute borrowers as well – to attack the demand to get rid of the supply. I hope we do not go that way, at least not for the time being. As an argument, it has logic. As a policy, less so. Most people do not go to illegal moneylenders, and pay those blood-sucking rates, because they want to. They are desperate. Borrowing from banks and other licensed institutions is reserved for those who are credit-worthy. The typical customer of an illegal monerlender is not. His need for money may however be no less real or compelling. Not everyone has family or friends he can turn to for help.
More importantly, regardless of the reasons behind the borrowing, criminalising borrowing would have little deterrent effect on individuals who are desperate. It would only serve to compound their problems, and worse, those who depend on them.
But that is not to say that borrowers should be let off the hook. The Bill aims to criminalise provision of false information to illegal moneylenders. This is a good step forward as it punishes those who take loans and leave innocent third parties to face the despicable recovery methods. We should throw the book at them. But even this does not go far enough. How do we deal with those who provide correct information but subsequently change their place of residence? The problem is the same and yet they get off scot-free. They move out, fully aware of the problems they will be saddling future occupants with. The authorities would have details of these individuals, and where they have moved to. There must be some way to make them accountable. Can they for example, not be made responsible to make good the damage caused by the moneylenders?
We also need to help those who buy over flats from debtors, and who may therefore unwittingly inherit the problem. Can the HDB not require the seller and the occupants to furnish a statutory declaration that they are not indebted to illegal moneylenders? If the seller comes clean or opts not to declare, the buyer can then decide with full knowledge whether he wants to proceed with the purchase. If the seller is eager to sell his flat, he will have the incentive to settle the debt. If the seller lies, he can be prosecuted for making a false statement.
The proposed amendments are a good step in the mission to rid us of this illegal money lending scourge. We can be sure that the kingpins will try to find new ways to entrench and extend their business and keep one step ahead of the law. I therefore urge the Ministry not to wait to see how these new steps work before introducing other measures. The thing about cockroaches is that just when you think you have stamped them out, they spring back to life.