ECHO underway, posted Thursday, August 5, 2010
Sharks that walk on land would attract spectators far and wide, but a particular species of land shark walked the state in the first decades of twentieth century. The “loan shark evil” was found in the form of small agencies calling themselves “salary buyers” rather than lenders. One of the most notorious was Chicagoan Daniel H. Tolman, who owned and operated sixty-five of these agencies in the eastern United States, with one located in Hartford. Nearly all of these agencies were run by women, who were taught how to persuade customers to sign contracts surrendering property or wages at an interest rate totaling 1000 percent. (Yes, you read that correctly: one thousand percent.) And, more often than not, these women, and not Tolman, were arrested for usury.
State law regulated loan interest rates at this time, so these contracts were illegal. Yet the desperation and ignorance of those needing such loans of money allowed Tolman to become a very, very rich man. The state’s business leaders worried when employees were served court orders for debt, meaning claims against future wages employers had not yet paid. The state’s charities, too, found that any aid they gave needy families may go to loan sharks, if those families had indebted themselves to the likes of Tolman and his competitors.
In Connecticut, the charge against Tolman and other loan sharks was led by Hugh M. Alcorn, State’s Attorney from 1908 to 1942. Connecticut had passed a small loans act in 1907. In 1909, Alcorn arrested Dora (or Doris) Griffith, Tolman’s agent in Hartford. She was defiant, and the case took two years to settle. The Hartford Courant reported in January 1911, “In the conduct of business she was almost vicious towards those who obtained loans if they did not meet their payments promptly. She made different threats of exposing borrowers to employers, and the better a borrower’s position the easier it was for her to intimidate him.” She was not the first of Tolman’s agents to be taken to court; other women working for Tolman had already stood at the bar of justice and lost. It took many years, and many trials, and many laws, to slay the “loan shark evil.”