UNITED KINGDOM: A London businessman explains how to avoid the debt trap the he fell into, which at one point reached into the millions

Record ID: 803512

  • Title: UNITED KINGDOM: A London businessman explains how to avoid the debt trap the he fell into, which at one point reached into the millions
  • Date: 23rd November 2011
  • Summary: LONDON, ENGLAND, UNITED KINGDOM (NOVEMBER 15, 2011) (REUTERS) VARIOUS OF SHIFRIN PLAYING WITH WATCH IN HIS HAND (SOUNDBITE) (English) JASON SHIFRIN, BUSINESSMAN, SAYING: "So it was just literally John number 1 would say here's GBP50,000 (USD78,205) and I would say I'll return you GBP60,000 (USD93,846), so I'd then go and borrow GBP70,000 from somebody else and return hi
  • Embargoed: 8th December 2011 12:00
  • Keywords:
  • Location: United Kingdom, United Kingdom
  • Country: United Kingdom
  • Topics: Economy
  • Reuters ID: LVACY82V2PJZUNRQVC177UAR8V5Z
  • Story Text: London businessman Jason Shifrin knows what it's like to have money. He also knows what it's like to lose it.
    At the height of his career as a jeweller he was turning over a million pounds (1.6 million USD) a year - selling gold and watches to wealthy footballers.
    He was living in a 6-bedroom house, drove the best cars and went on a string of luxury holidays.
    Then he borrowed a GBP150,000 (USD23,469) from a friend to expand his business and the nightmare began.
    "He ran into difficulties himself and he had to leave the country, so the person he borrowed the money from, which I didn't know anything about turned out to be two pretty heavy gangsters," Shifrin explains.
    He says they upped the interest dramatically, and before long Jason was in over his head, borrowing further to keep up.
    "John number 1 would say here's GBP50,000 (USD78,205) and I would say I'll return you GBP60,000 (USD93,846), so I'd then go and borrow GBP70,000 from somebody else and return him GBP60,000 (USD109,487) and then borrow GBP80,000 (USD125,128) off of another John and return them GBP90,000 (USD140,814) and it kept rolling up - I just kept borrowing and borrowing just to pay the interest", Shifrin said.
    "I guess if you added all the interest and everything put it all in one bucket you'd say it was ten million pounds (USD 15.6 million) at the worst point," he added.
    When he couldn't keep up with the payments Shifrin began receiving death threats and sent his wife and two children abroad.
    For wife Nicole Shifrin everything came out of the blue.
    "It was total shock and disbelief and you know my whole world just completely came crashing down," she remembers.
    Jason's case is extreme but there are thousands more like him.
    Official figures show that British households have amassed more than a trillion pounds (USD 1.6 trillion) of debt in mortgages, credit cards, overdrafts and other loans.
    And that figure is set to double by 2015.
    Jason and his family are slowly rebuilding their lives.
    He's no longer supplying bling to footballers but he is managing to make a living.
    Both Jason and Nicole say they've learnt some important lessons.
    "I took material things for granted," Nicole admits. "I think I took relationships with friends and things like that for granted. I assumed people were there because they like me or this, that and the other, but you learn who your friends are."
    Speaking of his experience Jason says that especially the approaching festive season can become a debt track, with many companies promising easily accessible loans.
    "Anyone that tells you that by borrowing money off these legal loan sharks they just put you into more debt", Jason explains. "In simple terms if you can't afford to buy your family Christmas presents this year, don't buy them. And when you're sitting around the Christmas table say 'I'm very sorry I couldn't afford to buy you Christmas presents this year but I didn't want to get into debt' and anyone who doesn't respect that they shouldn't, you shouldn't have them around you."
    Jason also says the policy makers are partly to blame by encouraging a culture of spending and borrowing.
    "I don't believe the country, the government have learnt from the mistakes of the last two or three decades [sic] because they're still encouraging us to go out and get credit. They still telling us to buy furniture at nought per cent interest a year. They're still telling us to buy all these Christmas presents and pay for it a year later. So they still want us to get into debt," he said.
    In his new book, 'Money, Money, Money' Jason has written about his experience which he hopes will help others to avoid the debt trap and make enough money to clear the remaining million pounds he still owes.
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