Loan Sharks Circle Credit-Starved Consumers

LONDON -- During Britain's boom, easy credit helped Eduardo Ireneo pile up £1,750 ($2,848) in bank debt. When the boom turned to bust in 2007, though, banks cut him off and he turned to a loan shark, an illicit credit source that is gaining steam.

Mr. Ireneo's case sheds light on a revival of illegal lenders, who are making hay as people's incomes fall and legitimate borrowing avenues shut down. For Mr. Ireneo, a caregiver at a London nursing home, financial problems led him to a loan shark who charged a staggering 60% interest rate. (more)