What I don't get is why are people terrified of NOT paying back the money and percentage to the loan sharks? Wouldn't be it easier to call the cops on them when they threat you with violence? Loan sharking sounds like like risky business to me if you're handing out money to people you don't know.
Some of the people that deal with traditional OC loan sharks are not people that can call the cops. You can't call the cops if you're a crooked union agent who's been embezzling union funds and needs to go to the shylock to make up the difference until the next contract is approved. You can't go to the cops if you're taking loan shark funds to set up your next cocaine importation or start your very own escort agency. If you're a degenerate gambler calling in the cops would mean you're cut off from the loan shark's associated bookie network. No good.
That aside, even if you are an otherwise law abiding citizen, you may be leery of going to the police. You may not want anyone knowing your business. The loan shark and his friends may have a very well developed reputation for hurting people who cause them problems.
Loan sharking is a very very easy business for a criminal to get into. It doesn't require anything more than some seed money, some very basic math skills and a willingness to hurt people if need be. The up and coming loan sharks may even be looking for a few people to brutalize just to keep their rep up-especially if the people don't owe them much money.
But again, actual violence is not always needed-particularly if the debtor has collateral or other connections that the loan shark or his bosses/friends can capitalize on. Someone might get a new business partner or wind up doing illegal favors to work off a debt. The whole idea is to extort money, favors and fear for a very very long time-ideally forever.
