Interest for medicine, gambling, business...: Usury in Montenegro (26)

More often than in banks, citizens resort to informal loans that promise quick money without paperwork or guarantors, but consciously or unconsciously, they enter long-term spirals of misery and helplessness, which can cost them their property, health, and even their lives.

This was shown by a research by "Vijesti" on the scale of usury, and the collected data say the same as sources from the security sector - that several thousand people are involved in this illegal business in Montenegro, which does not correspond to the small number of reports against people engaged in this illegal business, so the number of those who took money at interest is officially unknown.

The reasons for borrowing vary, but three dominant motives stand out from the open-ended responses - gambling and bookmakers, trying to start a business when banks refuse loans, and urgent life situations such as medical treatment, debts, and lawsuits. Gambling addiction was particularly frequently mentioned, where an initial debt of several thousand euros grows into tens of thousands.

This was confirmed by several interviewees of "Vijesti" whose confessions were published. While some spoke about how 1.000 euros borrowed for the treatment of a child, or for the treatment of a pregnant wife, turned into a noose that was tightened around the necks of families for years, others did not hide that they were led into debt slavery by the disease of gambling addiction...

"Because that brother gambled for me and was just looking for a way to get some money...".

"It wasn't reported because it was taken by a colleague who is a gambler and couldn't get any credit, so the team had to settle their debts that they incurred through gambling...".

"Every day people get into debt for gambling, we have a big problem...".

"He gambled on debt and borrowed from moneylenders...".

"I had a problem with a betting shop... Then I borrowed from people close to me and gambled it all away... Loan sharks know where to look for victims, they wait in betting shops...".

"He got into trouble with gambling, and then the standard story - interest. From interest to interest...".

These are just some of the answers from "Vijesti"'s interlocutors, and some were even more detailed when it comes to gambling debt.

"Most of us get into debt because of gambling and stupidity, and a smaller part because of real needs and problems, such as medical treatment or business. At least that's the situation with the people I know, and there are dozens of them. We are all in debt to almost the same loan sharks, we all try to get out in the same ways. Some of us have even tried to cure our gambling addiction, but at this point it seems impossible to me, because I'm going around in circles and I know it's not their fault, but it seems to me that if I didn't owe money to loan sharks, I wouldn't be gambling," he says.

And while explaining how, with the help of family and friends, he is trying to solve the problems he created himself, this interviewee of "Vijesti" admitted that his gambling cost his family almost one and a half million euros.

Research shows that debt bondage doesn't just happen to the "irresponsible," but that anyone can fall into it - loan sharks are just waiting for a moment of weakness.

Both the interlocutors from the security sector and the survey results show the same thing - some citizens took on debt out of necessity, when institutional assistance was unavailable or too slow, while a significant number went into debt to maintain a lifestyle beyond their realistic possibilities or to cover gambling losses, decisions that today, in conversation with the journalist, they recognize as serious personal mistakes.

Explaining why they literally put their lives in the hands of loan sharks, the interviewees mention complicated procedures in banks, the inability to borrow legally, or creditworthiness.

Into the clutches of a loan shark for a loan

One of them, however, sought out moneylenders so that, after he quit his job, he could repay a bank loan secured by a mortgage on the family apartment...

"None of us thought about ruining our lives by borrowing. If we had, we wouldn't be doing this, but it's easy to be smart these days. There are some life circumstances that we may not have been able to influence, which have led us into this vicious circle from which there seems to be no way out. Several people I know, who are in the same problem as me, have made hundreds of new ones because of one mistake. Specifically, I left a job that I wasn't happy with, without thinking about the fact that I had a loan from a bank and that I had to repay the installments. I didn't find a new job quickly, and in order not to jeopardize my family's apartment, which had a mortgage, I went to a loan shark," he says.

He explains that he left his job in 2007, which is when his problems began...

"At first it was bearable, I do something physically, I have to pay the interest, and I'm calm for 30 days. Then I got a job and thought that everything would be easier, but it wasn't. I was in that problem for four whole years, until November 2011. In fact, I wasn't in a problem, but I was getting from one problem to another, because I covered one loan shark with another, and later tried my luck at roulette. Which only made the situation worse. When I realized that I couldn't find a way out, I confessed everything to my family," says the interlocutor of "Vijesti" from the central region.

He also states that the family then did something that he still regrets today:

"Everyone who was creditworthy took out loans from banks - my mother, sisters, brothers-in-law, cousins... I understood this before, but from this distance I understand better how much hell I caused my family and theirs. Even now I don't know how I didn't end it all by taking my own life, I believe it was the desire to repay them that kept me going," says the forty-five-year-old.

He adds that due to the constant pressure from loan sharks, he feared for his family, and that later depression set in.

"At twenty-something, you don't realize what one thoughtless decision can do. When you become aware, it's quite late, because the pressures are already there, the fear for the family, for my sisters' newborn children at the time, for everyone around me. I think that was the key trigger for me to give in one night, gather them together and confess everything to them. I was lucky that they didn't leave me alone to solve the problem I had created, but many in our country either didn't have it, or didn't have the courage to break the vicious circle of calls, pressures, interest on interest and constant shame, which still doesn't stop whenever that period of life is mentioned, because, in addition to the debts I had incurred, which were not small, my family also struggled with my depressions, and then with the fact that I was unable to work at that moment," says this interviewee...

When asked about the amount he and his family were repaying, he claims that the debt started with 1.500 euros, but that by 2011 it had turned into "serious figures."

“The first time I borrowed money, it was 1.500 euros. That wasn't a lot in 2007, but it seemed like a 'great' idea to pay off the installments I owed at the bank and bridge the gap until I got a job. I didn't realize that, in addition to the installment at the bank, I would also have to manage the installment to the loan shark. When it started to suffocate me that my occasional jobs couldn't satisfy both, I borrowed 3.000 euros to pay off one loan shark, deposit a little in the bank and move on. Only then did the problem arise, which I tried to solve in the same way, borrowing five thousand to 'close' another loan shark, and then 10.000 euros to get rid of this one, until one day I walked into a casino, and only then did the real hell begin. Trying to earn money for the loan sharks, I completely ignored the bank, until the moment I realized that we would be left without an apartment... None of us, no "Whatever his name, whatever he looked like, whatever reason he got into debt, he doesn't deserve what people who borrow money from loan sharks go through. No matter how relieved you are when you get out of debt, you are left with a ruined life. Yours and the lives of everyone who went through hell with you," he adds.

He points out that this is precisely why he is talking, not to make it easier for himself, but as a warning to anyone who might, for whatever reason, seek "help" from loan sharks.

"Because of the hell my family went through and everything I see around me now, almost two decades since I started taking on debt, I think it's important that we all talk about the problem of usury and do our part to put an end to it. Not to shift the blame onto the usurers, I know very well how much I am to blame for all of this, but so that the state can finally start looking at this problem, because if there are fewer opportunities for people to get into debt, there will be fewer broken families and ruined lives. I think those who judged me then, or those who today judge anyone who has financial problems and who has put themselves through the pain of going to a usurer, should understand that we are not all equally lucky - some have been given everything, while others have to struggle and that their suffering is made even harder, because this is where it is easiest to judge and generalize," he says.

Men's problem

The interviewee's confession confirms the results of the "Vijesti" research, which reveals a clear picture - loan sharking is a dominantly male problem. Of the total number of respondents, 84 percent are men, the rest are women.

The most indebted are in the most active age group between 35 and 44, followed by those between 25 and 34. This is the generation that bears the burden of family, loans, business risks and existential challenges. Next are respondents aged 45 to 54, while those under 25 and over 65 are in significantly smaller numbers.

The period of borrowing confirms that the problem is not a thing of the past, as almost a third of the approximately 800 respondents stated that they borrowed in the last 12 months, slightly less one to three years ago, and the rest more than three years ago.

What everyone has in common, including almost a quarter of respondents who have borrowed from moneylenders multiple times in different periods, is that interest rates are up to 30 percent per month, and that threats and fear are almost a given.

For most people, at least according to what they answered the journalist and wrote in the questionnaire, loan sharks were the first option, because credit institutions were too complicated for them...

"I needed a couple of thousand euros. The procedure at the bank was too complicated. I went to a man who lends money at interest. I took it, returned it with the agreed interest. Everyone was happy and satisfied," explains one of the respondents.

That response is one of the few that did not involve threats, problems, and intimidation from loan sharks...

Others, however, complained about complications in banks, talking about the horrors they experienced because "no one else at that moment wanted to help me start a business", or "I visited all the banks in Montenegro and they asked for two guarantors, which is impossible to find...".

The most common answer, however, was that "banks don't give money without major complications", and that you get the money in half an hour - "unlike a bank, you wait 20 days with them".

Among the dominant reasons for falling into the clutches of moneylenders is that they are "more efficient and faster" than banks...

At those moments, the newspaper's research shows, they did not think about the conditions or how they would repay their debt if, as in the case of a young man from Podgorica, a debt of 100 euros borrowed for a night out turned into 300 euros in ten days...

Some respondents "reported" interest rates higher than 30 percent per month, and some even daily or weekly interest calculations. In practice, this means that a debt of several thousand euros can multiply in a relatively short period of time.

A large number of responses indicate that rules are often adjusted on the fly and that this is always to the detriment of the debtor.

"A small problem seems solvable by borrowing money at interest. And it's always in your head for a month, until then I'll figure something out. The month goes by quickly and after 30 days you're in the same problem, plus the installment/interest. And then it drags on for years," one of the respondents replied.

The other, however, says something similar to the interviewee of Vijesti from today's confession - the family suffers the most:

"The family suffers the most because of the member who took the money. The system does not protect them, and the person who took the money very often knowingly drags other family members into the problem. Prison sentences are needed for loan sharks and the system does not protect them. Gambling should also be banned," the interviewee wrote...

In a detailed email sent to the journalist, with many personal and other details, one of the interviewees, who did not specify whether the complete confession was for publication, wrote:

"My story is, more or less, like most people who have run into problems with interest and loan sharks - a gamble. Starting with small loans of 100, 200, 300 euros to 1.000, and the maximum amount borrowed from one person was 5.000 euros. Interest was charged on small amounts of 30-50 percent, with a repayment period of three to four weeks, while on these larger amounts there was a fixed interest rate of 10 percent. I borrowed at interest to carry the interest, to buy peace for a few days. Because there is a Montenegrin saying - 'if time is passing slowly for you, take money at interest, and it will fly by'...".

Lending money or consumer goods to others while agreeing to make a disproportionate profit is a criminal offense in Montenegro.

Anyone who does this will be punished with up to three years in prison and a fine, according to the description of the criminal offense of "usury" in the Criminal Code (CC) of Montenegro.

If the usurer "takes advantage of the poor financial situation, difficult circumstances, necessity, frivolity or insufficient ability to reason of the injured party", he will be punished with imprisonment from three months to three years and a fine.

The Criminal Code stipulates that a loan shark can be punished with imprisonment from six months to five years and a fine if serious consequences have occurred for the injured party or the perpetrator has obtained material gain in an amount exceeding three thousand euros.

In tomorrow's "News", read the confession of a coastal man who was forced by loan sharks to transport cocaine to Serbia, held a knife to his throat, and tried to steal his property...