Poor families are prey for criminals

It’s not easy being poor. Not only do you have to survive each day, thinking of how to provide your children with the next meal, but there are countless people and organizations that want to trick you into getting a new loan. JOEP DERKSEN looks into the matter.

More than 150 families with children in the province of Groningen experienced firsthand what it feels like to be outsmarted by somebody. They believed the idle promises of Bureau Integraal, owned and led by one man. Bureau Integraal promised its clients to help them get out of debt. For this ‘assistance’, the families had to pay a fee.  They all obliged, hoping this man would rescue them out of their daily misery. But the only thing that criminal did was put the money in his own pockets. Something good did come out of this situation, however. Groningen residents collected food and supplies for the duped families.

The Groninger Kredietbank (credit bank of Groningen) has also supplied these families with ‘leefgeld’ (emergency allowance) from the ‘Urgent Needs’ foundation . With this assistance, the 150 families managed to be able to pay for their food and drinks. Not only did the receivers not have to pay back this donation, but the municipal council also made sure that none of the families would be evicted from their homes because of Bureau Integraal’s wrongdoings. This was a real threat to some of the families, since they were unable to pay basic expenses like rent or utilities. They had paid Bureau Integraal to take care of these payments for them, but the owner-annex-sole employee kept that money for himself, leaving the victims in even more dire circumstances. Bureau Integraal has since been declared bankrupt.

Sadet Karabulut is Member of Parliament for the Socialist Party (SP). She has been fighting these criminal debt negotiating organizations for years. “Many people in financial difficulties are victims of agencies that want to make a profit from other people’s misery and debts. The government says the market should regulate itself, but this doesn’t happen. Private debt negotiators should adhere to legal standards. These standards should be set up by this government,” Karabalut says. Her party also wants to impose a ban on the current situation, which allows private debt collectors to charge money for their services.

The Groningen fraud case is not just an isolated example; similar cases occur throughout the country. Who hasn’t heard of emails from a ‘prince’, ‘rich man’ or some other person from countries such as Nigeria, promising the receivers huge sums of money if they can just use the gullible email recipient’s bank account . The American Office of Fair Trading reports on another scam, according to the website www.geldlenen.org. These particular emails don’t offer a reward, but state one can borrow money at a very advantageous interest rate. The offer is almost too good to be true. And indeed, it isn’t. You will never get back the compensation fee you paid to obtain this loan. Of course, the ignorant victim can also forget about receiving one single cent from that ‘loan’.

These emails are written in bad English or Dutch, and are easily recognizable. Yet, still many people fall into the trap. These are usually the type of people that are already knee-deep in debt and accept the offer in complete desperation, even though they sometimes know better. This email is their last hope, perhaps the one that can save them from a life of debts. Instead, the email offer only pushes them deeper into the debt hole.

And what effect does a life of debts have on children? Will they fall into the same debt traps as their parents did? Not necessarily, a survey from the SCP (Sociaal en Cultureel Planbureau) shows. No less than 93% of children from a poor family are now living above the poverty line. For most of them, this achievement did not come easily, because they were faced with arrears on the fields of social participation and goods. Often, there was no money for a bicycle, suitable sports clothes or holidays. Poor kids also spent less time on playdates withtheir classmates. The fact that most children grow out of this situation when they start earning their own income is a positive thing, the SCP says: “There is no inescapable mass poverty culture in the Netherlands.”