Plenty of people have used payday loan companies. But for some, turning to one of these institutions could be the only choice a person has to avoid getting evicted, their children not eating, or the electricity getting turned off. These companies know this, and that how they get away with what they do. They make millions off of vulnerable, desperate people with nowhere else to turn. What they do should be criminal, and what happened to an 18-year-old British teen is proof of that.
Kane Sparham-Price was found to have hanged himself, right after a payday loan company called Wonga emptied his bank account. Sparham-Price had aged out of Britain’s version of the foster care system, and he was planning to move into a new flat. But, like many desperate people, he took out multiple payday loans, and had no way to repay the money. As anyone who has used one of these places knows, the catch to getting the loan is that they can debit your account automatically if you don’t pay. What Wonga did was completely legal.
The coroner who handled the teen’s death, ordered an inquiry into Price’s tragic death and sent a letter to the Financial Conduct Authority, which read, in part:
‘Whilst I accept that the various payday lenders are legally entitled to ‘clear out’ someone’s bank account if money is owing to them, it struck me that there ought to be a statutory minimum amount which MUST be left in an account (say £10) to avoid absolute destitution; and as I understand you set and regulate the rules, you might look at this with a view to preventing further deaths.”
Pollard is right. People do desperate things when they don’t know how they are going to survive. That is clearly what happened to this poor kid. A life in the foster care system, reported mental health issues, and financial desperation led him down a path of financial ruin, and he saw no way out.
Hopefully, America can take a leaf out of John Pollard’s book, and put a cap on these companies.
Image via Facebook/Metro UK