Fears over end of North East loan shark team

Union bosses and MPs have criticised a decision to end funding for a team which combats the activities of loan sharks in north-east England.

The Teesside-based North East Illegal Money Lending Team was set up in 2007 by the previous Labour government.

But coalition ministers have said work done by the team is to be handled by a centralised squad in Birmingham.

The move has been criticised as a "backward step" which could lead to an increase in illegal lending.

The North East team has identified 170 potential loan sharks, arrested 62 suspects and been involved in bringing legal proceedings against 36 people since it was established.

Loan books covering £1.8m and £170,000 cash have been seized.

But the government has ruled an England-wide team should be based in Birmingham to save money.

'Known hotspot'

Labour MP for north west Durham Pat Glass said: "The North East team has been hugely successful in protecting our local communities from loan sharks who prey on the most vulnerable.

"Disbanding it would be a backwards step precisely at a time when we need more tough local action on loan sharks.

"As cuts start to bite, money will become tighter at home for people and loan sharks will be waiting in the wings to capitalise on this."

A spokeswoman for the union Unison added: "The removal of a dedicated team from the region will be nothing short of a disaster.

"The loss of the team could potentially lead to resurgence in criminal targeting of the poor, needy and vulnerable in a region that is a well known hotspot for loan sharks."

But Conservative MP for Stockton South James Wharton said: "The current set up costs £500,000 a year, and it has delivered one conviction in the last 12 months. That is not value for money."

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