Loansharking refers to the illegal practice of lending money at extremely high interest rates, often associated with organized crime. This practice typically involves intimidation or threats to ensure repayment. In many jurisdictions, loansharking is considered a serious offense due to its exploitative nature.
Loansharking is primarily relevant in criminal law, as it involves unlawful lending practices. It may also intersect with civil law when victims seek restitution or damages. Individuals dealing with loansharking can use legal forms to report the crime or seek legal remedies. US Legal Forms offers templates that can assist users in navigating these legal processes.
Here are a couple of examples of abatement:
Example 1: A person lends $1,000 at a 50% interest rate, which is significantly higher than the legal limit. They then use threats to ensure the borrower repays the loan on time.
Example 2: A small business owner is approached by a loan shark who offers a quick cash loan but demands repayment with exorbitant interest and threatens harm if the debt is not paid. (hypothetical example)
In many states, loansharking is classified as a felony. For instance, a person may commit loansharking if they knowingly receive interest rates greater than twice the legal limit. If threats or force are involved, the offense may escalate to a higher felony class. Specific statutes vary by state.
| State | Loansharking Classification |
|---|---|
| California | Class D felony |
| New York | Class C felony with enhanced penalties for threats |
| Texas | Class A misdemeanor |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Definition |
|---|---|
| Usury | Charging interest above the legal limit, but may not involve threats. |
| Predatory lending | Unfair lending practices that exploit borrowers, but not always illegal. |
If you believe you are a victim of loansharking, it is crucial to document all interactions with the lender. You should report the situation to law enforcement. Additionally, consider seeking legal advice to explore your options for protection and restitution. US Legal Forms offers resources that can help you prepare necessary legal documents.
Browse our library of 85,000+ state-specific legal templates.