MONEY-LENDERS BILL. [H.L.] (Hansard, 30 June 1913)

§ LORD NEWTON
My Lords, this Bill is an amending Bill of a very simple character, and the only new material in it is comprised in Clauses 2 and 3. It contains three novel provisions. The first is that a money-lending company shall be obliged to describe itself as a money-lending company; the second provision is that money-lenders should give their own names in addition to the assumed names which they have adopted; and the third provision is that, circulars from moneylenders should be prohibited unless they have been requested to send them a certain period in advance. The first provision is one to which I do not attach much importance, and upon which I do not think I need waste any time. It is a perfectly obvious provision.
With regard to the second provision—the one which provides that money-lenders shall give their real name in addition to their fictitious name—I have made somewhat singular discovery. I have been informed by a gentleman who is much better acquainted with the tribe of usurers than I am that the reason why these fictitious names are adopted is that the money-lender as a rule lives under his own name in an intensely respectable if not fashionable neighbourhood, and if his real avocation was disclosed he considers, or probably his landlord considers, that the reputation of the neighbourhood would suffer, and the money-lender also considers that he would suffer in social prestige. As a matter of fact he adopts these names, as far as I am able to make out, for a purely sentimental reason; and I submit that sentiment has no business to enter into money-lending at all. At all events no money-lender that I ever heard of displayed any sentiment, and it is not the smallest use appealing to them on sentimental grounds. I submit, therefore, that it is perfectly unnecessary to indulge any person who follows this somewhat dubious profession by studying his fastidious taste with regard to the appellation which he is pleased to bestow upon himself.
But, sentiment apart, the practice of adopting aliases by money-lenders has been grossly abused. In 1900 an Act was passed dealing with money-lenders. Under 690 that Act they were allowed to register themselves under the fictitious names to which I have alluded; but it was clearly the intention of the Act that this should apply merely to persons who had been trading under these fictitious names, because it was thought a hardship to deprive them of their use after they had used them so long. And I would point out what great services have been rendered with regard to this matter by Truth, both in the time of Mr. Labouchere and since his death. It has been frequently pointed out in that newspaper that owing to the laxity of the Commissioners of Inland Revenue numbers of these usurers have been permitted to register themselves in an improper, or at all events totally unnecessary manner. I find, for instance, that one Blumberg by name converted himself into Burton. A certain Samuel Cohen blossomed forth into the name of Curzon. A certain Josiah Abrahams became Rosslyn Stuart; and. Mr. Abraham Cohen converted himself into L. Fortescue, Ltd. I myself the other day prosecuted one of these people for sending to a daughter of mine who happened, fortunately, not to have reached the age of 21, a circular offering to let her have, if she required it, £50,000 in bank notes unknown to me; and this personage wrote under the imposing title of Harms-worth, Limited. Harmsworth, Limited, turned out to be a creature of the name of Levene, who, associated with his brother, presumably represented the company in question.
In addition to this, it has for some time, also owing to the laxity of the Inland Revenue Commissioners, been the practice of these money-lenders who desire to trade under aliases to form themselves into bogus companies, consisting, I believe, in many cases of the usurer himself and his clerk and a few dummies. This practice has been frequently called attention to and commented on in the Law Courts. I observe that Abraham Cohen alias Fortescue, Limited, was prosecuted not long ago; and the magistrate held that this was not a company formed for a lawful purpose within the meaning of the Companies Acts. Were the registers at Somerset House examined I am convinced that in a large number of cases it would be found that bogus companies had been formed practically for the purpose of defeating the various Aloney-lenders Acts. This practice was denounced by the late Lord Macnaghten as defeating the very 691 object of the Act of 1900 by preventing the disclosure of the real names of people carrying on this particular business.
Under this Bill I do not propose to make these people change their names altogether. I merely propose that in addition to the fictitious names which they have assumed they should add their own. Moses and Aaron, for instance, trading, say, as Crewe and Lansdowne, would be obliged to disclose their identity. And I really cannot see that any injustice is perpetrated by a proposal of this kind. I have always been given to understand ever since I can remember anything that one of the most persistent of these people who circularise us is the representative of a noble Lord who is a member of this House. Therefore if this Bill passes it is possible that interesting disclosures may be made; and it may possibly be a consolation to some unfortunate young man who is paying, say, 150 per cent., which is about the usual rate charged by these people, to discover that instead of paying this exorbitant interest to a Semitic plebeian his debt is to some patrician of ancient and distinguished lineage.
With regard to the suppression of these circulars unless they are applied for—and there is nothing in the Bill to prevent anybody asking to have the circulars sent to him if lie so desires—I would point out that there has been a most portentous development of this particular kind of business. The development has been so great that it almost looks as if the usurers were making the best of their time in fear that some steps might be taken to interfere with the practice at some not remote date. The gentleman whom I came in contact with the other day admitted sending out 50,000 circulars a year. That gives sonic indication of the enormous mass of this kind of literature. As a matter of fact, these circulars shower upon everyone—upon the young and the old, the rich and the poor—in a positively unending stream, varying in appearance from communications which look as if they were confidential communications from ladies in high position to open envelopes with ½d. stamps, which are liable to be opened by the office boy, by servants, or by any persons employed on the premises. I believe that the mischief which is done by the broadcast circulation of these documents has been the cause of an enormous amount of harm. It is perfectly true that it is an offence to 692 send these circulars to minors. But the moral offence of sending a circular of this kind to a boy or girl just over the age of 21 is as great as, if not greater than, that of sending it to somebody under that age. The essence really of the advertising usurer's proceedings is to get the young and the ignorant into his clutches by misleading statements, and then remorselessly exact all that he possibly can from the unfortunate parents or relatives subsequently. I should very much doubt whether this practice of permitting these circulars to be sent unchecked all over the country is allowed to prevail in any other civilised State. I am under the impression that there are stringent regulations in every other country which prevent a practice of this kind. I have even received communications from moneylenders themselves, those of a more respectable type, who strongly denounce the practice.
It will, perhaps, have been observed that I do not propose to interfere with the advertisements of money-lenders in the Press. If it is asked why money-lenders' advertisements should not be treated in the same way as this House has decided that advertisements of bookmakers shall be treated, I think the reply is obvious. Betting, if it is not a luxury, is an amusement; you cannot describe it as a necessity. On the other hand, nobody would dream of borrowing money unless he was literally obliged to. There is no amusement about it whatever. And it is quite conceivable that cases might arise in winch a person who wanted to borrow money at short notice might find a certain amount of convenience in the fact that these advertisements appeared in the Press. Bat to be quite candid I am not solely actuated by feelings of this kind. Warned by recent experience I recognise the extreme danger of setting the Press against me. I am aware that if I included the Press in this Bill a certain section of the Press, which probably makes a good thing out of these advertisements, would at once fall upon me, and not only would they prove that I was a person unfit for human intercourse, but they would succeed in persuading a number of gentlemen in another place to oppose this Bill on the ground that it infringed high moral principles. As the Bill is drawn, so far from meeting with opposition from the Press, I trust that the Press will be on my side, because it is perfectly obvious that if the Bill passes the money-lender will be 693 obliged to have recourse to the Press instead of relying upon the post as he does at the present moment.
There are only two observations with which I desire to conclude. One is that I think the public generally is under a great debt of gratitude to Truth in connection with the campaign which it has always waged against these men, who, in my opinion, are one of the greatest curses of modern life. The second observation I desire to offer is this. I own to feeling strongly on the matter myself, because years ago a relative of my own had the misfortune to fall into the clutches of the late Mr. Samuel Lewis, a money-lender who amassed an enormous fortune at the expense of the gilded youth of this country. This Mr. Samuel Lewis, for some inscrutable reason, was looked upon as a favourable specimen of his profession. My experience of him produced precisely the opposite effect. He insisted on my unfortunate relative paying him more than three times as much as he had ever borrowed, and the effect was that he eventually ruined him. All I can say is that if Samuel Lewis was a favourable specimen of his class then the other members of the profession are even worse than I imagined them to be, and I do not think we need be dissuaded from passing legislation by any fear of being too severe on usurers.
In asking the House to give a Second Reading to this Bill I feel little doubt that my request will be assented to. I have noticed, as probably many other noble Lords and possibly the public may have noticed also, that uncontentious and unpretentious measures of this kind receive a sympathetic reception in and pass through this House without any difficulty; but when they go down to the more democratic Assembly difficulties arise and all sorts of obstacles are put forward in face of what most people would consider to be perfectly reasonable and unobjectionable measures. I trust that the noble and learned Viscount on the Woolsack, who I have reason to believe is in some sympathy with me, will give this Bill his benediction; and I hope that if such approval is expressed it will have some weight when the Bill goes to another place, and that with luck the Bill may possibly be passed as a noncontentious and unopposed measure. I beg to move.

THE EARL OF MEATH
My Lords, I congratulate the noble Lord on having introduced this very useful Bill. It is not, perhaps, a measure which will excite a great deal of enthusiasm throughout the country, but it is of a practical nature, and I feel certain that it can do nobody any harm. I do not imagine that there will be any opposition to it in this House. Indeed, I hope that the same support will be given to this Bill by your Lordships as was extended last month to a similar Bill of a social character introduced by Lord Newton, but which, as the noble Lord hinted, has apparently not made very much progress in another place. There is probably no member of this House who does not receive one of these circulars weekly. I do. I have never borrowed any money in my life; yet I am pestered almost clay by day with these circulars. What I do is this. I send Mr. A.'s letter to Mr. B., and vice versa, because I think it is sad that the circulars should be wasted—and I do not pay the postage. But I continue to receive them all the same.
This Bill will not prevent anyone from borrowing money who needs it. Advertisements in the newspapers will show any man who wants money where he can go to borrow it. But what the Bill will do is this. It will prevent a man who is in temporary difficulty and who is of weak will from acting on the spur of the moment when he receives one of these circulars offering a loan at five per cent. Such a man might say, "I can pay five per cent., and nobody will know anything at all about it." And when he gets into the hands of the money-lender what does he find? He finds that he has to pay, not, as he thought, five per cent. per annum, but five per cent. per month, and perhaps per week—Heaven alone knows whether it is not per day. He repents of his action probably within twenty-four hours after he has sent off the letter, but he is in the money-lender's hands and he never gets out again. Lord Newton has told your Lordships what happened in the case of one of his own relatives. I cannot conceive anything more wicked than for a moneylender to destroy a man's prospect in life simply for vile gain. And the moneylender in question was said to have been one of the best of the tribe!
I hope we are going to pass this Bill. What pleases me more than anything is 695 to see a noble Lord coming forward as Lord Newton has clone with these little social measures, which to my mind are of more service to humanity than many of the Bills of a sensational character brought forward in another place, of which it may be said that it is doubtful whether very often they do not do more harm than good. Useful little Bills like the one now before us find a happy reception here, and I thank God for it. I trust that the House of Lords will always show itself willing, wherever it can, to improve the social condition of the people, to prevent unnecessary loss of money and of property, and to encourage in every way those virtues which tend to make good citizens. I have great pleasure in giving my humble support to the noble Lord's Bill.

§ THE LORD CHANCELLOR
My Lords, thirteen years ago the Money-lenders Act passed through Parliament. Much was expected of it, and it has effected a good deal. But experience has disclosed gaps in its construction, and it is with some of those gaps that Lord Newton's Bill deals. As to the attitude of the Government towards the Bill, it is this. We look on the Bill with favour; we recognise the evils with which it proposes to deal, and are desirous of seeing them redressed; and when the Bill reaches another place it will receive our benevolent attention. We cannot promise to give Government time, which, as the noble Lord knows, is very fully engaged; but if the Bill meets with a favourable reception in the House of Commons, as I think it undoubtedly will, the noble Lord may count upon this, that, with the qualification I have just made, any assistance the Government can give will be gladly given to this Bill.

§ LORD JOICEY
My Lords, before the Question is put I should like to be allowed to say a word or two in support of this Bill. The general impression is that this is a Bill to protect the rich. That, in my judgment, is not the case. It may protect the rich to a certain extent, but its chief usefulness will be in protecting the weak, who are the principal sufferers from the proceedings of money-lenders. I have come in contact in the North of England with a great number of cases where moneylenders have got hold of poor men whose only property is their furniture. These men are tempted at times of financial pressure to give bills of sale upon their 696 furniture, and enormous interest is charged. Many cases of this kind have come to my notice where money-lenders have got control of these poor creatures and have kept them under their thumb during the whole of their lives, threatening to take possession of their furniture and very often doing so. I therefore hope that your Lordships will give a favourable consideration to this Bill and I am convinced, if the Members of the other House were fully acquainted with the evils which arise among the comparatively poor, that instead of attempting to prevent this Bill becoming law they would be only too glad to assist in its rapid passage.

§ THE MARQUESS OF LANSDOWNE
My Lords, I think the general feeling of the House will be that a debt of gratitude is clue to my noble friend for the crusade which he has undertaken against the kind of abuses with which this Bill is intended to deal. I shall certainly gladly give him my vote if he requires it. He has pointed out the new provisions which the Bill contains. There can be no doubt that the clause under which the tribe of moneylenders will henceforth be compelled to register themselves, not only under their private name but under their alias or aliases, because I fancy that a great number of them trade under more than one assumed name, is entirely desirable, and I trust that it may become law. The further provision that a firm of money-lenders trading as a body corporate should be obliged to disclose the fact that they are money-lenders seems to me also to be a very appropriate alteration in the law.
The only part of the Bill with regard to which I feel any doubt is the third clause, in which it is made a punishable offence for a money-lender to send circulars to any one unless that person has in writing made a request to that effect. I do not for a moment suggest that it is desirable that these circulars should be issued broadcast; but when it is suggested, as it was a moment ago, that it is the business of Parliament to protect all persons of weak will from temptations of this kind, I am inclined to ask myself whether we do not sometimes go rather too far in so protecting them. As my noble friend explained to us, under the law as it now stands these money-lending gentry are entitled to advertise themselves. They can advertise 697 to any extent in any newspaper the business which they carry on and the terms upon which they are ready to lend money. I never like inserting provisions of this kind into a Bill unless one can feel sure that the protection will be an effectual one. But what kind of protection are von offering if the individual of weak will whom we are to think about can find in any newspaper that he picks up an announcement that such and such a firm is prepared to lend him money on such and such terms? The point is not a Second Reading point, and it is one which we may perhaps consider further when we come to Committee.
One word with regard to the form of the Bill. My noble friend has not attempted to consolidate the law with regard to money-lenders, although he has, and I think very properly, repealed the second section of the Act of 1900 and substituted a new clause containing the old section plus certain alterations which he has specified; hut, on the other hand, he has allowed the Act of 1911,which is also referred to, to stand intact, so that the simplification of the law which one would have hoped for has not really been carried very far. I dare say my noble friend will consider the points to which I have referred, but in the meantime I, for one, welcome his Bill and feel grateful to him for having introduced it.