Loan Sharking

NMSA 1978 ch. 30, art. 43

in effect

NMSA 1978, § 30-43-1 Short title

30-43-1. Short title This act [30-43-1 to 30-43-5 NMSA 1978] may be cited as the "Loan Sharking Act". Laws 1980, ch. 39, § 1.

NMSA 1978, § 30-43-2 Definitions

30-43-2. Definitions As used in the Loan Sharking Act: A. "creditor" means any person making an extension of credit or any person claiming by, under or through any person making an extension of credit; B. "debtor" means any person to whom an extension of credit is made or any person who guarantees the repayment of an extension of credit, or in any manner undertakes to indemnify the creditor against loss resulting from the failure of any person to whom an extension is made to repay the same; C. "extortionate extension of credit" means any extension of credit with respect to which it is the understanding of the creditor and the debtor at the time it is made that delay in making repayment or failure to make repayment could result in the use of violence or other criminal acts other than petty misdemeanors to cause harm to the person, reputation or property of any person; D. "extortionate means" means the use, or an express or implicit threat of use, of violence or other criminal acts other than petty misdemeanors to cause harm to the person, reputation or property of any person; E. "to collect an extension of credit" means to induce in any way any person to make repayment of one extension of credit; F. "to extend credit" means to make or renew any loan or to enter into any agreement, tacit or express, whereby the repayment or satisfaction of any debt or claim, whether acknowledged or disputed, valid or invalid and however arising, may or shall be deferred; and G. "repayment of any extension of credit" means the repayment, satisfaction or discharge in whole or in part of any debt or claim, acknowledged or disputed, valid or invalid, resulting from or in connection with that extension of credit. Laws 1980, ch. 39, § 2.

NMSA 1978, § 30-43-3 Making extortionate extensions of credit

30-43-3. Making extortionate extensions of credit A. Any person who makes or conspires or attempts to make an extortionate extension of credit is guilty of a third degree felony. B. In any prosecution pursuant to this section, if it is shown that all of the following factors were present in connection with the extension of credit, there is prima facie evidence that the extension of credit was extortionate: (1) the extension of credit was made at a rate of interest in excess of an annual rate of forty-five percent calculated according to the actuarial method of allocating payments on a debt between principal and interest, pursuant to which a payment is applied first to the accumulated interest and the balance is applied to the unpaid principal; (2) at the time the extension of credit was made, the debtor reasonably believed either of the following: (a) one or more extensions of credit by the creditor had been collected by extortionate means or the nonrepayment had been punished by extortionate means; or (b) the creditor had a reputation for the use of extortionate means to collect extensions of credit or to punish the nonrepayment thereof; and (3) upon the making of the extension of credit, the total of the extensions of credit by the creditor to the debtor then outstanding, including any unpaid interest or similar charges, exceeded one hundred dollars ($100). C. In any prosecution pursuant to this section, if evidence has been introduced tending to show the existence of the circumstances described in Paragraph (1) of Subsection B of this section and direct evidence of the actual belief of the debtor as to the creditor's collection practices is not available, then for the purpose of showing the understanding of the debtor and the creditor at the time the extension of credit was made, the court may, pursuant to the New Mexico rules of evidence, in its discretion allow evidence to be introduced tending to show the reputation as to collection practices of the creditor in any community of which the debtor was a member at the time of the extension. D. Nothing contained in Paragraphs (1) through (3) of Subsection B of this section shall be construed as a requirement for the proof of the existence of an extortionate extension of credit. Laws 1980, ch. 39, § 3.

NMSA 1978, § 30-43-4 Financing extortionate extensions of credit

30-43-4. Financing extortionate extensions of credit A person who knowingly advances money or property, whether as a gift, loan or investment, to any person with reasonable grounds to believe that it is the intention of that person to use the money or property so advanced, directly or indirectly, for the purpose of making extortionate extensions of credit is guilty of a third degree felony. Laws 1980, ch. 39, § 4.

NMSA 1978, § 30-43-5 Collection of extensions of credit by extortionate means

30-43-5. Collection of extensions of credit by extortionate means A. A person who knowingly participates or conspires or attempts to participate in the use of any extortionate means to collect any extensions of credit or to cause harm to the person, reputation or property of any person for the nonpayment thereof is guilty of a third degree felony. B. In any prosecution pursuant to this section, for the purpose of showing an implicit threat as a means of collection, evidence may be introduced tending to show that one or more extensions of credit by the creditor were, to the knowledge of the person against whom the implicit threat was alleged to have been made, collected or attempted to be collected by extortionate means or that the nonpayment resulted in the use of extortionate means. C. In any prosecution pursuant to this section, if evidence has been introduced tending to show the existence at the time the extension of credit in question was made of the circumstances described in Paragraph (1) of Subsection B of Section 30-43-3 NMSA 1978 and direct evidence of the actual belief of the debtor as to the creditor's collection practices is not available, then for the purpose of showing that words or other means of communication shown to have been employed as a means of collection in fact carried an express or implicit threat, the court may, pursuant to the New Mexico rules of evidence, in its discretion, allow evidence to be introduced tending to show the reputation of the defendant in any community of which the person against whom the alleged threat was made was a member at the time of the collection or attempt at collection. Laws 1980, ch. 39, § 5.

Source: New Mexico Compilation Commission (nmonesource.com)URL: https://nmonesource.com/nmos/nmsa-unanno/en/item/18530/index.doFetched: 10/20/2026