The Big Read in short: Dealing with scourge of loan sharks in digital age

SINGAPORE — Mr Alan had no idea that his employee had borrowed from “loan sharks” until he was harassed with almost 120 calls over three days from various unlicensed money lenders.
The strategic consultant, who did not want to give his real name and spoke on condition of anonymity, discovered that his Singaporean employee had given Mr Alan’s name, personal phone number and the company’s main line to the illegal moneylenders, listing him as a guarantor. 
“During the period where there was constant harassment, if you don’t pick up right away they will call back immediately. They don’t allow your phone to rest, so if other people try to call you they cannot get through,” said Mr Alan, who is in his 50s. 
He immediately terminated the man’s contract for placing his office and other colleagues “at risk” and advised his staff on how to field calls searching for the former employee.
While this happened in 2017, Mr Alan received a call from a stranger looking for his ex-employee last year. 
Mr Alan’s brush with “Ah Longs” — a colloquial term derived from the Cantonese phrase for illegal moneylenders — despite him not having borrowed a cent from them is not unique.
In recent years, unlicensed money lenders have used both time-tested and less conventional methods to force their borrowers to pay up — from harassing the latter’s employers to using social media to scare and shame debtors and engaging “runners” to intimidate them. 
Mr Sebastian Pereira, a sales manager and delivery rider on Foodpanda, also had a taste of another loan-shark tactic when he was out on a delivery last year.
The 51-year-old said “nothing looked amiss” when he picked up a cash-on-delivery order for fishball noodles in Pasir Ris.
Upon arriving at the drop-off location in Bedok, however, he found more than 10 other delivery riders from various platforms congregating at the void deck for orders to the same address, who informed him it was a “loan shark case” and that no one at the address had actually ordered the food. 
“It’s another way of harassing the victims, because the loan sharks themselves don’t want to be caught. Especially (harassment tactics) like paint and graffiti, those people can be caught. But food delivery, you don’t know who they are,” said Mr Pereira. 
Some lawyers told TODAY that they have seen more cases of teenagers or youths being recruited by these illegal moneylenders as their runners, while the police said on Thursday (June 20) that they have also seen an increase in the proportion of youth arrested for unlicensed money lending activities. 
From January to May 2024, 8.6 per cent of unlicensed money lending arrests involved youths between the ages of 14 and 19, a spike from 3.1 per cent for the corresponding period in 2023.
A search of police news releases by TODAY found at least 67 reported cases of individuals being arrested for allegedly helping loan sharks in the past six months. 
Many of the cases involved teenagers caught for alleged loanshark harassment, including a 14-year-old who was arrested on June 5, for suspected involvement in setting a fire outside a flat at Yishun Avenue 6. 
Since January this year, at least three islandwide operations have been conducted to suppress unlicensed moneylending activities, with over 100 persons being investigated on each occasion for allegedly harassing debtors at their homes, carrying out bank transfers and providing banking information to facilitate unlicensed money lending business. 
On June 8, the police said that 128 persons aged between 14 and 73 were being investigated for their suspected involvement in unlicensed moneylending activities, following a five-day islandwide operation in May.
On Friday, Ng Kwong Seng, a Singaporean man who rose through the ranks to become a “towkay” (boss) for an illegal moneylending syndicate based in China, was sentenced to 51 months’ jail and a fine of S$495,000.
For 13 years, Ng had worked for the syndicate, which charged Singapore borrowers 20 per cent interest for loans. 
Before the dawn of the digital age, spraying paint and locking gates were among the unlicensed moneylenders’ favourite tools of the trade.
Today, loan sharks have adapted with the increasing use of social media not only to harass debtors — but also to advertise and contact potential borrowers, such as through unsolicited messages boasting fast approval loans. 
One victim of such harassment was Ms Ika Lestari, 40, whose former helper had borrowed money from unlicensed moneylenders.
The teacher recounted to TODAY how despite blocking many phone numbers that sent threatening messages, the loan sharks still managed to track her down via social media.
They took screenshots of public photos of her face and sent them to her with messages such as “Is this you?” and issued other threats such as “I go your house because you block me (sic)”. 
Ms Gloria James, head lawyer at Gloria James Civetta and Co, added: “They may also contact neighbours, family members, co-workers and employers online in an attempt to cause harassment and to embarrass the borrowers.” 
As for recruitment of borrowers and runners, messaging platform Telegram has been a “game changer” in the past five years, said lawyer Kalidass Murugaiyan, who has worked with young offenders between the age of 16 and 22.
“Around 10 to 15 years ago, (recruitment) used to be on websites. There were popular forums where these (listings) were posted, but now it’s gone even deeper, because it’s on Telegram. If you go to Telegram and type ‘Sell ATM card’, you might get something,” said Mr Kalidass from Kalidass Law Corporation.
As for why young persons are drawn to working as runners, the authorities said youths tend to commit loan shark harassment for “fast cash”.
The going rate can be between S$300 to S$800 per job, though some are paid less, said officer-in-charge of the Anti-Unlicensed Moneylending Squad at Bedok Police Division, Assistant Superintendent of Police (ASP) Michael Ho.
When asked if there was a noticeable trend of youths who commit unlicensed money lender related offences coming from lower-income families, ASP Ho said that these youths typically come from a range of backgrounds.
“Some of them come from better off families, but (they commit these offences) because of the attraction (of earning money) and the lifestyle, their daily expenditure, (as) they may spend more as compared to previously,” said Mr Ho.
Despite the well-documented horror stories about victims of loan sharks, illegal moneylenders will continue to exist in some form simply because there is demand for them, said experts. 
Associate Professor Razwana Begum, head of the public safety and security programme at the Singapore University of Social Sciences, said that those who borrow from unlicensed moneylenders are likely to be in the lower-income bracket.
Gig workers, who may be living “day by day” on an unstable income with no savings may also be at “higher risk” of seeking financial assistance from unlicensed moneylenders, said Assoc Prof Razwana, who is also a Nominated Member of Parliament.
Mr Josephus Tan, managing director of Invictus Law and a criminal defence lawyer who has represented clients as young as 14 in such cases, noted that many of his cases were done pro bono for the “down and out” who became involved with loan sharks because of their financial or family circumstances.
In one case, a man with a failed small business who contracted cancer borrowed money from loan sharks to pay for his family’s medical bills. To offset his debts, the loan sharks asked him to hand over his banking information to them.
“People recruited by loan sharks are victims in their own right, either the young and ignorant who want to make a quick buck or those who owe the unlicensed moneylenders and are trapped in the vicious cycle (of assisting lenders),” said Mr Tan.
Thus, experts and Members of Parliament who spoke to TODAY urged for a multi-pronged approach to tackle the issue of loan sharks, including stepping up public education efforts to boost financial literacy and curb the recruitment of runners.
One way to help people who are more likely to borrow from unlicensed sources is to introduce “targeted, contextualised” saving plans and financial literacy programmes for them, said Assoc Prof Razwana.
While illegal moneylending may seem impossible to eradicate, the question then is whether the same can be said of harassment of borrowers. 
With tough anti-unlicensed moneylending laws here, some of the people and syndicates behind such illicit activities have also shifted overseas and are able to operate remotely. 
This and the evolving landscape of online methods of harassment, to include the use of food delivery platforms or social media to harass borrowers, has made it more difficult to catch the culprits, who can hide their identities. 
However, the authorities are working with various stakeholders, including social media platforms, to take “tough enforcement action” against those involved in loansharking activities, said Senior Investigation Officer of the Criminal Investigation Department’s Unlicensed Moneylending Strike Force, Inspector Ong Tiam Huat.
Lawyers also said that cracking down on runners and seizing assets can help to make the illegal business less attractive, and place pressure on unlicensed moneylenders. 
For example, arresting and prosecuting runners and lenders can “significantly disrupt” the unlicensed moneylenders’ ability to recruit victims, collect debts and harass their borrowers, said Ms James. 
At the end of the day, reducing inequality is key to ending the ‘Ah Long’ problem, said Assoc Prof Razwana.
“As long as inequality exists, we will not be able to completely eradicate unlicensed money lenders. However, we could try to minimise the dependency and make it harder for them to operate.”