UVF bosses in Newtownabbey have fined drug dealers £5,000 and given them payment plans if they cannot come up with the cash.
The scam makes a mockery of claims from the terror gang that it is transforming into an old boys' network, and calls into question efforts to secure £5m of government funding for its supported projects.
Last autumn, UVF chief-of-staff John 'Bunter' Graham installed a new leadership in the South East Antrim gang after the old bosses were caught taking backhanders from drug dealers.
The deposed 'brigadier' was ordered to pay a £50,000 fine in return for being allowed to keep a part-share in a taxi depot, while his 2IC (second-in-command) was subjected to a beating and expelled from the organisation.
The newly-installed leaders were supposed to put an end to criminality, but according to UVF members, the rackets are as bad as ever.
"They rounded up half-a-dozen fellas in the Rathcoole estate the other week and accused them of drug dealing," a source told Sunday Life.
"Each of the fellas was fined £5,000, even though some of them aren't drug dealers.
"When a few of them complained about not having the money, they were given a payment plan.
"It's like taking out a hire-purchase agreement with the UVF. That's how crazy a situation it is. One of the guys was told he has to pay back £200 per month for the next two years."
UVF insiders claimed the organisation used a taxi driver to round up the cash, which he stores in a biscuit tin in his car. They said that small shops and businesses throughout south-east Antrim continue to have to pay protection money to the gang.
"The extortion is as bad as ever. If small businesses aren't paying money to the UVF, they are paying it to the UDA," added our source.
The revelations will heap further pressure on the UVF, which is seeking £5m of public money over the next five years to help it transform into a community-based organisation.
Its leaders Bunter Graham and Harry Stockman held secret meetings with senior government officials at Archbishop of Canterbury Justin Welby's London palace to discuss the deal.