High Interest Loans?

richkarlmarx · Jul 16, 2009

ok so i got this friend whose got this friend who is involved in some really shady biz (dont ask dont tell type of stuff, but i think it may be drug related).anyways my friend's talking to me bout this guy and he mentions that the guy offers high interest rates for short term loans (which he uses to fund hisoperations).

The guy said that $2000 will get me 25% interest in 3 weeks. I told my friend to check his rates for less money (until i find out if it is or isnt legit).

have any of you guys ever heard of an operation like this? is this illegal (because youre allowed to loan money to your "friends" right?) And doesthis sound like i'm going to get scammed?

kdawg · Jul 16, 2009

Yeah, it's illegal - he's lending money without a license and because it's an outrageous interest rate I'm pretty sure that comes under usurylaw - basically charging interest more than the standard rates - that make it impossible to sue the person you have loaned the money to as it's an illegaltransaction - hence why loan sharks go around breaking bones and things.

Like you said, it's shady - and it's unethical as it preys on the disadvantaged in society.

richkarlmarx · Jul 16, 2009

Originally Posted by kdawg

Yeah, it's illegal - he's lending money without a license and because it's an outrageous interest rate I'm pretty sure that comes under usury law - basically charging interest more than the standard rates and that make it impossible to sue the person you have loaned the money to - hence why loan sharks go around breaking bones and things.

Like you said, it's shady and it's unethical as it preys on the disadvantaged in society.

wait, sorry, i dont think i understood you right. I'm not disadvantaged. I'm a normal guy who wants to make some extra money. I can takemy money to this guy (who is mad rich) and he'll pay me 25% interest in a few weeks, so hes not preying on me.

holdup, unless youre saying that he reloans it to somebody else? (which is possible, idk what he does)

kdawg · Jul 16, 2009

Yeah, that's what he's doing - he's lending the money to someone who can't get a loan from legit sources - and screwing them with the interest.

25% for a few weeks is particularly outrageous - even 12% for a month is bad and that's about 4x that. Think about your credit card - mine has an interestrate of about 1.5% a month.

These people are never left alone - if they can't pay the loan they pay interest on it forever with threats and blackmail hanging over them all the time.

So, like I said, it's illegal - and it's also just wrong anyway.