Estevan Perera
A precedent-setting judgment in the Supreme Court, issued on Monday, has put key restrictions on moneylenders inclined to exact excess monies from their desperate and overburdened customers. Supreme Court Justice Sonya Young has ordered Laura and Julio Blanco of Pay Day and EZY Loans Pawning, located in Orange Walk Town, to return a thirty-acre cane field in Orange Walk. The Blancos transferred this land into their name after accepting as collateral for loans totalling three thousand, five hundred dollars issued to Janine Vega in 2014. Justice Young agreed that moneylenders have no right under the law to take a customer’s assets, mortgaged for the loan, as their own if payment is not made as agreed. Neither, she ruled, do they have the right to charge significantly higher rates of interest than those allowed under section twenty-six of the Moneylenders’ Act. With the entire agreement ruled unenforceable, what security does the pawnshop have now, and does the sweeping effect of the judgment harm moneylenders? News Five spoke today to Attorneys Estevan Perera and Kevin Arthurs, who represented Vega and say that the judgment is in fact a win-win for moneylenders who do not behave unscrupulously.
Estevan Perera, Attorney for Janine Vega
“The pawnshops are always protected, because they ask for a collateral. We are not saying that they cannot sell the collateral if the customer doesn’t pay; but they must sell it for the reasonable value and take out of that what is owed to them, and the balance is returned to the individual. So for example, using a small-scale situation: if a pawnshop takes your car, that’s worth fifteen thousand, and you’ve only borrowed one thousand dollars; if you should default, the pawnshop is entitled then to sell your property, your vehicle, for the fifteen thousand, collect their one thousand dollars, but then they are obliged to give you back the fourteen thousand.”
Kevin Arthurs
Kevin Arthurs, Attorney for Janine Vega
“In the case of moneylenders, the Legislature considered and calculated what the risk was worth, and they put a cap on it. So when the moneylenders are calculating and formulating their business plan, they know that the maximum I can charge, because Parliament has calculated it, is four percent. The second thing is that these loans are not designed to be long-term loans; these are supposed to be short-term loans for small amounts. It has happened that because they have been unsupervised, they have spiralled without control and monitoring, to become a monster unto themselves. I also want to say at this point, though, that this is a good judgment for moneylenders; if I am a good moneylender, a good businessman, and want to do things right, I know exactly what I can and cannot do.”