The Washington herald., 1914-03-07
loan SHARK Law
NOT UNDERSTOOD
Citizens Committee Offers
Aid to All in Clutches
of Lenders.
THEIR RIGHTS UNDER ACT
Need Only Pay Back Three-fourths
of Amount Borrowed With
out Any Interest.

Although for the last three weeks Mr.
Stephens. Mr.. ywhiteford. and Dr. VIII
Jams, the assistants of the corporation
counsel, have been doing all they could
TO assist those who are in the grasp
| of the loan sharks, and have made the
law plain to great numbers OF persons
who have called upon them, ii is probable
that only a small portion of those affected
have come to them, and that in spite OF
the earnest work of the officials many
still are not actually aware of their
rights under the law, or are not In
position to insist on them.
While suits against five more persons
have been filed. there has been no trial
of any loan shark since the law was
affirmed by the Court Of Appeals In the
Beagan case more than a month ago. No
one has been fined or imprisoned. and.
except in the cases where the borrowers
have conferred with the assistant cor
poration counsel. the loan sharks have
not yet been hindered in collecting from
their patrons not only all the principal,
but all the iniquitous interest charged,
or as much of 1t is they could get.
Offices StIII Kept Open.
The citizens committee finds that many
OF them. if not all of them, still have
their offices open, and are reaping all
the harvest within reach from the un-
lawful business of the last year. They
get all they can on their claims in spite
of the law. One poor woman, who had
been informed as to the law. was re-
quired TO pay l per cent a month in ad-
dition to the entire principal, and she
did this because of the fear of conse-
quences IL she refused.
Recognizing the bitter injustice of
such continued impositions and feel
ing some responsibility in the matter.
the citizens committee desires to join
in making il plain to all. every bor-
rover against whom any loan shark
has any claim for money borrowed at
more than the lawful rate since the
present law took effect year ago.
that he need only pay back three
fourths of the amount borrowed, and
he need not pay any interest whsteSer.
This is what the law says, in sec
tion 4:
ANY person contracting, directly or in
directly. for, or receiving a greater rate
of interest than that fixed in this act,
shall forfeit all interest so contracted for
or received: and in addition thereto shall
forfeit to the borrower a sum Of money,
to be deducted from the amount due for
principal equal to one-fourth Of the prin-
Cipal sum-"
The law, therefore. cancels for the bOr-
ROVER that much of the obligation. just
as completely as if it had been paid in
cash. and the borrower only owes three
fourths of what he received. The lender
has no legal right to claim any more, or
to demand all the principal. or any in
terest at all. for the borrower does not
owe II.
There Is nothing unjust In this. The
law plainly made charging such rates as
have been charged a criminal act and
fixed the forfeiture of all the interest and
one-fourth of the principal as part of the
punishment. to help make the law ef-
fective. Those who made such loans for
unlawful gain took the chances, just as
if they had taken money they had no
right to from a helpless person by the
roadside. and those who refuse to pay
back more than three-fourths Of the
principal are simply helping to enforce
the law. as the corporation counsel is
when he prosecutes for the infiiction OF
fine and Imprisonment I'm addition.
Further Rights Under Law.
Moreover he need not pay this until il
is due under his contract. nor must the
matter be settled now under the law. IL
for any reason 1t is difficult or impOssi-
bic for the borrower to raise enough
money TO pay three-fOurths of the pTin-
Cipal at once. He can make the pay
ments as required until they nearly equal
three-fourths of the principal. and then
tender the remainder.
The citizens committee realize. how
ever. how hard II is for poor borrowers
to stand up against the demands of
loan shark, trained by long practice to
ioppress and defraud those on whom he
once gets a hold. and their inability to
secure their rights In such settlements
without assistance. The business of the
corporation counsel is to institute GRIM
inal proceedings. and they cannot go
farther than they have to protect the
interests of the borrower. or concern
themselves in any civil proceedings to
resist the payment of unlawful claims. or
to secure the repayment to the borrower
of what has been paid in excess in so
many instances.
Wishing to assist all unfortunate bor-
rowers I'm securing all their rights, and
particularly in getting back from the
money lenders as much as possible OF
what has been unla wfully paid. the cit
iZens' committee suggests that such bor-
rowers put their cases into the hands
Of Louis Gutenberg, a lawyer. at 323 Col
orado Building, corner OF Fourteenth and
G. streets, who has promised the commit
tee to give prompt and faithful attention
to all who may apply to him. The COM
mIttee suggests Mr.. Gutenberg because
he has already had considerable expert
ence In making such settlements. and
they believe him competent to care prop
erly for the interests Of those who need
his assistance.
It is hoped that by this means the
corporation counsers assistants may be
somewhat relieved from the work they
have been so unselfishly doing and so
given more time for pushing the neces-
sary prosecutions, and that some of
those who have gone to them may be
still further assisted in their claims for