Evening star., 1927-03-21
NEW DRIVE OPENS
|. ON LOAN SHARKS"
Stephens Urges Borrowers
to Demand Return of
Excess Interest.

Corporation Counsel Francis H.
Stephens launched a new offensive at
loan sharks" today, when he issued
an official statement advising all per-
sons who have borrowed money at
interest rates exceeding per cent
that they have legal right to demand
a refund of payments in excess of that
figure.
Companies which refuse to accede
to legitimate requests for such reim-
bursement, Mr.. Stephens declared, will
be hailed into court without further
delay, obliged to return the whole in
terest and 25 per cent of the principal
to the borrower, and run the risk of
being sent to Jail for 80 days.
THE law is explicit Mr.. Stephens
said. II have studied 1t carefully,
have weighed all of the score or more
cases that have been submitted to me.
and have decided upon definite
course of action. I believe it will
run loan sharks out Of business here
within the next 80 days.
Penalties Under Law.
Under the loan shark act of 1913.
person who charges more than s
per cent interest on a written con-
tract can be forced to refund the en-
tire interest and 25 per cent Of the
principal to the borrower. In addition,
the court can impose fine or a prison
sentence, or both, within it's discretion.
II want every person who has been
forced to visit a loan shark to figure
out how much interest they paid.
The s per cent is on the basis Of a
year. If man borrows a sum of
money for six months. at the legal
rate Of interest. he may be charged
only per cent.
Those who find they have paid
more than per cent should go to the
lender and demand a refund of the
excess charges. If he refuses, let
them come to my Office and I will
take the offender to court without
further delay in cases where there is
evidence that the law has been vio-
lated.
Evidence Against Several.
II have ample evidence against a
number of firms right now to show
that they have violated the law per-
sistently. When l take these cases
to court | shall ask the judge to i'm
pose the Jail sentence. The law in
tended the fine only for the man who
transgressed it's limits once or twice.
Mr.. Stephens was visited this morn
ing by a man who had made three
loans from a garage and repair shop.
For at least one of them he had paid
an interest rate exceeding 100 per
cent, computed on yearly basis.
Mr.. Stephens said each instance
seemed to be clear-cut case against
the lender. He told the man to go to
tL.xN oern HzIx
that the excess interest be returned.
Judge Gus A. Schult and Judge
John p. Mcmahon, two of the presid-
ing justices in Police Court, volun-
tarily commended The Star this morn
ing for initiating the present cam.
paign against usury in the District of
Columbia. They predicted that it
would have highly beneficial and last
ing effect in ridding the city of the
loan shark.
Campaign Is Commended.
'"The most unfortunate part of such
business enterprises" Judge Schuldt
said, lis that they fleece the very
class of citizens who can least afford
to pay their exorbitant charges. l
cannot commend The Star too highly.
We have seen enough of these goug-
CAS' anu ShdI Co-opeIdlo III every
way that / can in driving them from
cur midst forever
Long after The Stars campaign
has been forgotten, its benefits will
live" Judge Mcmahon added. This
is genuine public benefit The Star
is working, and I know 1t will sue
ceed. If there is any place in the
country where financial transactions
should be above question, it Is the
National Capital, and I shall lend my
hearty support to any movement head
ed in that direction. The Stars COM
paign is just such a movement"