MONEY-LENDERS BILL. [H.L.] (Hansard, 25 February 1914)

§ LORD NEWTON
My Lords, this is a small and modest measure which I introduced last session, and which passed through this House without opposition, and its provisions are so simple and so obvious that nobody is likely to find fault with them. The Bill merely enacts that a money-lending company should describe itself as such; that a money-lender should give his real name in addition to the fictitious one which he has adopted; and that money-lenders' circulars should be forbidden unless they have been expressly asked for. Since I introduced this measure, and since it, in common with many other deserving measures, was lost in the House of Commons, I have received an enormous number of communications from persons of all kinds—from employers of labour, from Government officials, from clergymen, and from professional men—complaining of the practice of money-lenders, and amongst them are a certain number of people who seem to imagine that, having got into difficulties with money-lenders, it was my especial duty to get them out of them by providing them with the necessary funds, appeals to which I have in some instances responded.
There are other people who strongly object to having had their names appropriated by touting usurers. A certain number of people have written to me indignantly complaining that such honoured names as, for instance, Curzon, or Rothschild, or even Harmsworth, have been appropriated by the money-lending fraternity, and the owners of such names not unnaturally resent it. As I pointed out on a previous occasion, money-lenders adopt the names of other people for a double reason. In the first place, they adopt such a name as one of those which I quoted just now as being evidence of good faith and a guarantee of respectability. The second reason why they adopt these pseudonyms is that money-lending appears to be an extremely unpopular profession. Many people who follow it live in fashionable and respectable neighbourhoods, and it is considered that if their real names and their real vocations were disclosed, the value of the property on which they 345 live would be considerably deteriorated. It is, as a matter of fact, largely a matter of sentiment, and what I submit is that sentiment is a consideration which ought not to enter in the least into the practice of money-lending, which is a strictly practical affair. I do not think that anybody will be found bold enough to assert that people who want to borrow are not entitled to know the names of the persons from whom they wish to borrow.
As an instance of the practices of these people, I will quote from a circular which I received myself a few days ago. It purports to come from Messrs. E. Leslie, Limited, of 35, Old Bond-street, who represent themselves as having available funds of £1,000,000 at their disposal, and state that they are prepared to lend me any sum that I require at 5 per cent. Well, anybody receiving a circular of this nature naturally assumes that R. Leslie, Limited, is a real concern, and that they have unlimited funds at their disposal and are prepared to lend money at 5 per cent. The truth is that there is no such person as "R. Leslie" at all; that the firm consists of a company of one director only, with, I suppose, a clerk or two acting as dummies, with very small capital; and that, judging by a case in which they recently figured, the amount at which they are prepared to lend money approaches much nearer 150 per cent. than 5 per cent. In addition to that, the firm in question—R. Leslie, Limited—I observed, much to my gratification, were fined the other day £40 for sending a circular to a boy at Eton.
But the statements of R. Leslie, Limited, are modesty and restraint themselves compared with another circular which I received the other day from a certain Mr. David Swyers. This person, who offered to lend me money on the same advantageous terms, also recently figured in a case, and I should like to draw the attention of the House to the procedure of this man. It is apparently his practice to send with his circulars a list of persons who desire to offer him testimonials, and amongst his clients I observe that he cites Peers, solicitors, doctors, generals, and clergymen. As an instance of the kind of testimonial quoted, I will read one which purports to come from a Peer— Dear Old Boy—Let me have bank-notes for £150 in the morning. Send your representative between twelve and one. Never knew a better friend. Sincerely yours, Lord—. 346 Then I find another one which purports to come from a general. It runs— My Dear David—Feel much better after my holiday. Thanks for kind inquiry after my health. Am calling with Sir—,who requires £300 for a short period. Kind regards. General Sir—. It will hardly be believed that in the case in which this man figured the other day it was admitted that these testimonials, of which I could quote a great many, were deliberate forgeries.
The case was tried at the Old Bailey on January 17 before the Recorder, and apparently the only remark that the Recorder made upon this proceeding was that it was of an objectionable character. In the Money-lenders Act of 1900 there is a section—section 4—which deals with a matter of this kind. This particular section enacts that if any money-lender by any false, misleading, or deceptive statements, fraudulently induces or attempts to induce any person to borrow money, he shall be liable on indictment to imprisonment, with or without hard labour, for two years, or to a fine of £500, or to both. I should like to know why a man who circulates bare-faced lies in this impudent manner is not prosecuted. What is the use of passing Acts of Parliament and having Public Prosecutors if impudent impostors of this kind are allowed to circulate pernicious rubbish which is liable to take in simple-minded people? The practice of sending these touting circulars round is one that has been condemned on all sides. There really is no occasion for me to enlarge upon it, because we are all familiar with the nuisance, and I have had any amount of evidence as to the harm which has been done.
One of the practices of touting moneylenders was exposed with considerable effect by a clergyman in the south-east of London not so long ago. This clergyman, a certain Rev. Herbert Williams, received a circular from one of these touting usurers, a Mr. Maggs. He replied to the circular, and the money-lender thereupon sent him £50 in bank-notes. Mr. Williams, much, I think, to his credit, appropriated the £50, deposited it in the bank, and refused to return the money. The money-lender, after many attempts to settle the matter amicably and many visits to the Rev. Herbert Williams, being unable to attain his object, was 347 eventually obliged to bring an action against him, and, of course, the clergyman had to part with the money. But that in itself, although the action of the clergyman was technically illegal, is an instance of the detestable means which are employed by these people, because it is perfectly obvious that no stronger temptation could be put in the way of a man who is hard up than the sending to him of bank-notes unasked with a view of getting him eventually into one's clutches.
I do not think that it is necessary for me to delay the House with any further arguments for the passing of this Bill. The practice of sending these circulars has, as I say, been emphatically condemned on all sides. It is not only a nuisance. If it was merely a nuisance it really perhaps would not be worth troubling about, but it is much more than that. It is really a danger; and not only is it a danger, but it provides means of blackmailing unfortunate people and extorting extravagant sums of money from them. Last year, as I have already explained, this Bill passed through your Lordships' House without any trouble whatsoever. The noble and learned Viscount the Lord Chancellor was good enough to interest himself in the measure and to suggest Amendments, which, of course, I was only too pleased to accept. But when the Bill when down to the House of Commons, although no one had expressed the smallest opposition to it, it was immediately blocked by an eccentric Radical Member of Parliament, who no doubt considers himself a representative of the true democracy, and this gentleman successfully blocked it on the ground that it was a socialistic measure. Well, after you have been a certain amount of time in politics you ought not to be surprised at anything, but I confess I never thought that I should live to hear myself denounced as a person with socialistic proclivities. I hope that upon this occasion the Bill will meet with a rather happier fate. As the noble and learned Viscount on the Woolsack was good enough to interest himself on the former occasion I hope that I shall again have the benefit of his assistance, and, although it is perhaps asking too much on my part, yet as it is an absolutely non-contentious measure, or, at all events, non-contentious with the exception of the one singular gentleman whom I have quoted, that the noble and learned Viscount 348 will use his influence with his colleagues to get the Bill included in the Government programme this session. I beg to move.

§ LORD COLERIDGE
My Lords, I desire to associate myself with the noble Lord opposite in support of this Bill, and although its introduction may seem to indicate that the Acts of 1900 and 1911 need strengthening, I hope the House will not think that those Acts have not been of great public benefit. Those of us who are accustomed to sit and to try to interpret between parties what the contract is and then to enforce it when so interpreted have had placed upon us the extreme difficulty of opening up and revising them where, as in the case of money-lenders' contracts, the conditions of the contract are plain and manifest; but we have not shrunk from that, and I am certain that the effect of giving power to open up and revise harsh and unconscionable bargains has been of the greatest benefit to those who need protection from the attacks of the lower class of money-lenders.
There is only one remark I have to make to the noble Lord. It is as to whether or not the Bill as he has presented it might not be improved in one respect. I notice that the Bill is aimed mainly at circularising. No doubt there is a great evil in that, and I am sure there can be no objection to the clause which deals with that matter. But there are grave evils in regard to money-lenders' transactions apart from circularising. Enormous evils flow from advertisements. I happened to cull from this morning's newspaper a number of these advertisements. One of them, for instance, announces "Special New Year offers to all classes," and states that £5 can be borrowed and repaid at the rate of 6d. weekly; £10 at 1s. weekly; and £50 at 5s. weekly—obviously a temptation to the poorest class to borrow money. Everybody who knows anything about these matters knows that as soon as the money is borrowed there is a document signed with a default clause in it, and the man who once puts his hand to a document of that kind may never get out of the clutches of the money-lender.
I am not at all sure whether the practice of advertisement would be covered by the 349 clause in the Bill which deals with circularising. Whether a man who places an advertisement in a newspaper could be said directly or indirectly to invite the person who buys the newspaper to borrow the money, I think is left a little vague. I can quite see the arguments on both sides. Perhaps the language of the Bill might be a little strengthened in that direction. Then, again, there are advertisements on walls, which are very attractive and very harmful, and which would not be touched by the Bill, and I suggest to the noble Lord that he might before the Committee stage consider whether or not some additional clause might be framed to meet a case of that kind. Otherwise I am sure on all hands the House will be grateful to the noble Lord for bringing in the Bill, and will be still more grateful to the Government if they can see their way to pass it into law this session.

§ THE LORD CHANCELLOR (VISCOUNT HALDANE)
My Lords, I think the noble Lord who moved the Second Reading of this Bill may well be gratified at its reception. No word has been said against it, except from the point of view of the defence of personal rights; and if the noble Lord has incurred the imputation which he instances I can comfort him by telling him that I have been exposed to that misrepresentation myself. Then he has the advantage of being supported on this occasion by the ripe experience of the noble and learned Lord who has just addressed the House. I doubt very much whether Clause 3 of this Bill, which prohibits the sending of circulars except in response to express invitation, would cover the case to which the noble and learned Lord referred. But it would be difficult to prevent people from advertising in some shape or form. There are some sections of the public who occasionally desire such accommodation, and they would insist on having the opportunity of knowing where it could be got.
The thing at which the noble Lord's Bill strikes is a very great nuisance. In many cases it is more than a nuisance. It is an evil that by misleading circulars people should be drawn into money-lending transactions which otherwise they would not touch. These circulars are couched in the most specious form. I dare say your 350 Lordships receive them. They certainly come to me in large quantities, and, like Lord Newton, I am always struck with the specious suggestion of 5 per cent. interest, and the silence as to the period for which the 5 per cent. is to be paid. It certainly is not "per annum." I presume it is nearer per week or something less than a month, and I am sure that unwary people, misled by the attractive nature of a circular, are often led into correspondence which leads to business on terms very different from those which they imagined they would be undertaking.
The two changes which the Bill makes in the law are mainly these. First of all, a money-lender will have to disclose his real name in his advertisements and in the announcements which he makes about his business; and, secondly, these moneylenders' circulars will be struck at. I think those are very useful changes. I have consulted the various Departments of the Government who might be cognisant of these things, and they are all favourable to the Bill. When the noble Lord introduced it last year I suggested certain Amendments which the noble Lord was good enough to accept, and these are now incorporated in the Bill. I am, therefore, in a position to say that the Bill has the blessing of the Government. Such blessings, however, do not always come to so much as one could hope. The difficulty, of course, is that of getting Government time, especially when there is likely to be any opposition. But I cannot think that any large body of opposition is likely to arise to this Bill, although it appears to be regarded by some as an interference with personal rights and personal liberty. But be that as it may, the Bill has the good wishes of the Government, and if towards the end of the session, as often happens, there is a certain amount of time and there is a certain amount of public opinion made manifest in favour of the Bill, I should think it would have a fair chance of passing. Certainly if that does not occur it will not be from any want of desire on the part of the Government to give the opportunity. I again say that I think the noble Lord is to be congratulated on his perseverance in pressing upon the attention of Parliament and upon the attention of the Government a reform which is urgently needed in the interests of social order.

§ LORD NEWTON
My Lords, before the Motion is put may I say a word in respect to what fell from the noble and learned Lord opposite? I fully recognise that this Bill, like many other Bills, is an extremely imperfect measure, and I do not imagine for a moment that it would, however desirable that might be, affect the advertisements which I am sorry to say disgrace many of the most reputable newspapers. But I have learned by sad experience that if there is one thing more difficult than another in the way of getting a Bill passed, it is to have the misfortune to set the Press against you. I have therefore purposely avoided dealing with this thorny point. But if the noble and learned Lord considers that the Amendment which he foreshadowed is one which ought to be introduced and likes to move it in Committee, for my part I shall be most happy to consider it

§ LORD CHANNING
My Lords, may I add one word before the Bill is read a second time? In the first place I wish, having taken a great deal of interest in the previous Act when it was passing through the House of Commons, to thank the noble Lord for persevering with this excellent Bill. In the second place, I want to express the very strong hope that what fell from the noble and learned Viscount on the Woolsack will not be inconsistent with the possibility, which former members of the House of Commons now in this House will readily remember, of "starring" this Bill as a Government measure. That would give it a much greater chance than if it merely had general benevolence on the part of the Government. I certainly hope, especially in the circumstances in which this House is now placed, that the Government will give every opportunity for useful legislation promoted by members especially on the other side of the House becoming law. It would be a credit to the Government and to the House of Commons if they secured the passing of this Bill into law in the present session.