Payday Loan Reform News – November 17

Highlights

Democrats May Deny It, But This Bill Is A Handout To Payday Lenders
November 16, Huffington Post
Rep. Gwen Moore (D-Wis.) has a payday lending problem. On Tuesday, HuffPost published an article highlighting an obscure piece of legislation moving through Congress that would help payday lenders and other shady operators skirt predatory lending laws passed by state governments. It’s the sort of bill Republicans sponsor all the time. Every now and then, Democrats quietly join them, hoping that a minor bill circling through the House Financial Services Committee will be overlooked in the grand legislative debates over taxes, health care and foreign policy. The bill was introduced by Moore and arch conservative Rep. Patrick McHenry (R-N.C.), and it exploits a weakness in national banking law to provide convoluted but very real aid to predatory lenders.

 

Top Stories

Consumers lose
November 17, Scranton Times-Tribune
American consumers lost a much-needed champion this week when Richard Cordray announced that he will resign as head of the Consumer Financial Protection Bureau.

 

Jury Finds Mosley Sr. guilty of running fraudulent payday scheme from KC
November 16, Kansas City Business Journal
Prosecutors say Richard Moseley Sr.’s companies defrauded more than half a million people over the course of a decade.

 

Action 9: Risky Car Title Loans
November 16, WFTV 9 ABC
Action 9 investigated a high-interest car title loan that could wreck borrowers’ finances and that Florida banned years ago. Action 9’s Todd Ulrich exposed how new lenders have used loopholes to bypass the ban, trapping Central Florida families with payments they can’t afford. Dan Pagan was unemployed and desperate to pay rent when he found an online car title loan offer. He sent the title for his Toyota vehicle to Marlin Financial for a $2,000 loan.

 

Democrats May Deny It, But This Bill Is A Handout To Payday Lenders
November 16, Huffington Post
Rep. Gwen Moore (D-Wis.) has a payday lending problem. On Tuesday, HuffPost published an article highlighting an obscure piece of legislation moving through Congress that would help payday lenders and other shady operators skirt predatory lending laws passed by state governments. It’s the sort of bill Republicans sponsor all the time. Every now and then, Democrats quietly join them, hoping that a minor bill circling through the House Financial Services Committee will be overlooked in the grand legislative debates over taxes, health care and foreign policy. The bill was introduced by Moore and arch conservative Rep. Patrick McHenry (R-N.C.), and it exploits a weakness in national banking law to provide convoluted but very real aid to predatory lenders.
Reposts: Huffington Post

 

Elderly Payday-Loan Scammer Convicted of $220M Fraud
November 16, Courthouse News
A senior citizen who extended payday loans at exorbitant 700 percent interest rates faces prison time after a jury found him guilty of a $220 million fraud.

 

Richard Cordray’s CFPB Has Done Its Job Well
November 16, CETUS News
President Donald Trump will soon get a chance to remake the Consumer Financial Protection Bureau, one of the signature creations of the 2010 Dodd-Frank financial reform law. The current director, Richard Cordray, has just announced his intention to step down. It’s a good moment to review what the bureau is for, and why it matters.
Reposts: Bloomberg

 

We need a watchdog at Consumer Financial Protection Bureau
November 16, The Washington Post
The federal agency charged with safeguarding consumers is in jeopardy. Richard Cordray, the director of the Consumer Financial Protection Bureau, announced last week that he’s leaving by the end of the month. Cordray’s departure gives President Trump an opportunity to appoint a new leader, and I’m concerned that this will derail the watchdog agency’s consumer-first mission.

 

Another Kansas City Payday Lending Businessman Convicted of Racketeering
November 16, Kansas City Star
A New York jury on Wednesday found Kansas City businessman Richard Moseley Sr. guilty of criminal charges related to a $220 million predatory payday lending operation. Moseley was convicted of wire fraud, racketeering, aggravated identity theft and other charges stemming from a payday lending business that charged consumers interest rates as high as 700 percent or more.

 

Senate Democrat is about to take the brakes off predatory payday lenders
November 15, Boing Boing
Back in July, Senator Mark Warner [D-VA, @MarkWarner, 202-224-2023] introduced S.1642 – The Protecting Consumers’ Access to Credit Act of 2017, which bans states from capping the interest rates charged by payday lenders who serve poor and vulnerable people, so long as the payday lenders partner with a national bank. The bill is nominally about allowing for innovation in finance products, but it has been widely condemned, drawing opposition from Americans for Financial Reform, the Center for Responsible Lending and the Consumer Federation of America, the NAACP and the Southern Poverty Law Center, who’ve warned that the bill will “open the floodgates to a wide range of predatory actors to make loans at 300% annual interest or higher.”

 

AARP says veterans are prime targets of scams and likely to be victims
November 15, VS Star
Military veterans are a prime target for telephone scams and even more likely to end up as fraud victims than the general public, according to a new survey released by AARP. The survey indicates that veterans can be victimized twice as often as the rest of the public. The research indicates that about 16 percent of U.S. veterans have lost money to fraudsters, compared with 8 percent of others during the past five years.

 

HFLA Launches Initiative to Help Underserved Reach Financial Stability
November 15, Cleveland Jewish News
The Hebrew Free Loan Association has launched its Looking to the Future Initiative with support from the St. Luke’s Foundation and the PNC Foundation. The initiative accounts for $73,000. The initiative enables HFLA to increase its lending of interest-free loans to Cleveland’s underserved neighborhoods and grows the organization by expanding its reach, according to a news release. HFLA received a $63,000 grant from the St. Luke’s Foundation and a $10,000 grant from the PNC Foundation to launch the effort.

 

Manhattan Jury Convicts Kansas City Payday Lender in $220 Million Fraud Scheme
November 15, Reuters
A federal jury in Manhattan on Wednesday found a Kansas City, Mo., businessman guilty of fraud for running a $220 million payday lending scheme that charged illegally high interest rates and made loans to consumers who did not authorize them. The U.S. Department of Justice said Richard Moseley, 73, was convicted on six counts including wire fraud and aggravated identity theft, after a 2½-week trial.
Reposts: All Media NY, St.Louis Dispatch

 

STATEMENT: Cap’s Joe Valenti on the Resignation of CFPB Director Richard Cordray
November 15, Center for American Progress
Since joining the CFPB, Director Cordray has turned a startup agency into a consistent consumer watchdog for the American people. The CFPB has returned approximately $12 billion to 29 million Americans harmed by financial wrongdoing. It has processed more than 1.2 million complaints. It has uncovered dozens of scandals that have taken dollars out of Americans’ pockets, including at least $450 million from communities of color for fair lending abuses alone. It has introduced new rules to protect consumers from predatory practices across a wide range of products, from mortgages to payday loans. And it has strongly fought for college students, student loan borrowers, service members, older Americans, and others dealing with a financial marketplace that has not always had their best interests at heart.

 

This Democrat Is About To Give Payday Lenders A Big Boost
November 14, Huffington post
A little over a year ago, Sen. Mark Warner (D-Va.) addressed a small audience of political insiders at the Brookings Institution, one of the most prestigious think tanks in the nation’s capital. Times were changing, Warner told the crowd, and the old guard from Washington and Wall Street wasn’t keeping up with the needs of the modern workforce. The gig economy, outsourcing and automation had created an era of unprecedented “income volatility” for Americans. New financial technology firms had “an opportunity to bridge part of that new social contract,” to “lean forward and meet workers where they’re working.” Reposts: News2read

 

Mark Warner’s “Capitalism 2.0” Is Usury
November 14, Splinter
It is not news that the Democrats are having trouble agreeing upon a clear and convincing message for 2018, but they keep reminding us anew each day. See, for example, the answer one prominent Democratic senator, Mark Warner, gave today when asked what the party’s “elevator pitch to millennials” is: Capitalism 2.0? What is that? Never mind that a majority of millennials say they reject capitalism. Never mind that that means literally nothing.

 

New Protections on High-Interest, Short Term Loans ‘First Step’
November 14, Pinal Central
Consumers seeking last-minute loans will soon have new protections. The Consumer Financial Protection Bureau, an independent federal agency established in 2011 after the Great Recession, issued a ruling last month to curb so-called “predatory” lending practices, a move some experts say will make a positive impact on Arizona consumers. The rules would require short-term lenders to determine upfront whether customers could afford to repay their loans.
Reposts: Cronkite News, Mohave Valley Daily News

 

Advocacy Groups Press for Restrictions on Payday Lenders
November 14, The Downey Patriot
On Tuesday, a group of more than 80 religious and community leaders sent a letter to the Los Angeles County Board of Supervisors, urging the board to take action next month to address high-cost payday and car title lending storefronts in the county. “Predatory lenders target our most vulnerable communities – particularly areas with high family poverty rates, which is why we’re asking for the board’s help,” said Paulina Gonzalez, executive director of the California Reinvestment Coalition.

 

Lending a Hand: Nonprofit Initiative Offers Path out of Debt Spiral
November 13, Hawaii Tribune Herald
Suffocating, the Delovios turned to payday lenders. But things only got worse. Instead of climbing out of debt, the family found itself simply shoveling more atop the considerable financial burden under which they were already stooped. “We (opted) for quick loans with high interest, not knowing a whole lot about it,” Savanna said. “We don’t want to be elderly trying to figure out a place to live and not being able to leave our kids something.” That’s when the family turned to a small, Hawaii-based loan fund that’s helping the Delovios and others like them build credit and erase debt.

 

Consumer advocates: New protections on high-interest, short-term loans take ‘first step’
November 13, Cronkite News
PHOENIX – Consumers seeking last-minute loans will soon have new protections.
The Consumer Financial Protection Bureau, an independent federal agency established in 2011 after the Great Recession, issued a ruling last month to curb so-called “predatory” lending practices, a move some experts say will make a positive impact on Arizona consumers.
The rules would require short-term lenders to determine upfront whether customers could afford to repay their loans. Reposts: Mohave Valley Daily News

 

Title Lender Offers Buyout Program Ahead of CFPB Rule
November 13, AutoFinance News
A Houston-based title lender — Advantage Finance LLC — today launched a program to refinance short-term title loans that may no longer be legal once the Consumer Financial Protection Bureau’s title lending rule goes into effect. In October, the CFPB released its final rule on payday and title lending, which requires lenders to assess a consumer’s ability to repay when making loans for 45-day terms and under. However, the rule largely left longer title loans past 45 days untouched.

 

Plain Talk: Speak up to put lid on ‘debt trap’ payday lenders
November 13, The Cap Times
Of all the crazy things Donald Trump has done since he assumed office last January, he needs to be talked out of doing something even crazier, and that’s his pledge to do away with the Consumer Financial Protection Bureau. The CFPB, which was part of the Wall Street reforms passed after the financial meltdown of 2007 and ’08, has been an unmitigated success in helping consumers even the playing field with big banks and other financial institutions.

 

Payday Loan Lenders Target Military Personnel
November 13, NBC 29 News
If you are one of the brave men and women serving our country in uniform, you face enough dangers. You do not need anyone attempting to take financial advantage of you by capitalizing on the unique challenges of military life. Unfortunately, you can find many payday loan lenders and other purveyors of short-term, high-interest loans near any military base. Bases are full of young service members with a regular and reliable paycheck fertile ground for lending groups. According to The Wall Street Journal, payday loan organizations target families with service members at twice the rate at which they target civilian families. Reposts: WZVN

 

Payday Loan Lenders Target Military Personnel
November 13, NBC 29 News
If you are one of the brave men and women serving our country in uniform, you face enough dangers. You do not need anyone attempting to take financial advantage of you by capitalizing on the unique challenges of military life. Unfortunately, you can find many payday loan lenders and other purveyors of short-term, high-interest loans near any military base. Bases are full of young service members with a regular and reliable paycheck fertile ground for lending groups. According to The Wall Street Journal, payday loan organizations target families with service members at twice the rate at which they target civilian families. Reposts: WZVN

 

The CFPB’s Payday Lending Rule a Grand Slam for Credit Unions
November 12, CUInsight
It’s hard to believe it’s been seven years since the forming of the CFPB, but it’s easy to remember what fueled its creation – a financial crisis that Americans hadn’t seen since the Great Depression. And what was one of the most flammable fuels in the fire? Mortgages. Specifically, mortgages that consumers couldn’t afford, couldn’t understand, and for which, in years prior, would never have qualified.

 

Veteran’s Day: How expansion of the Military Lending Act can help you
November 11, Fox Business
If you are one of the brave men and women serving our country in uniform, you face enough dangers. You do not need anyone attempting to take financial advantage of you by capitalizing on the unique challenges of military life. Unfortunately, you can find many payday loan lenders and other purveyors of short-term, high-interest loans near any military base. Bases are full of young service members with a regular and reliable paycheck fertile ground for lending groups. According to The Wall Street Journal, payday loan organizations target families with service members at twice the rate at which they target civilian families.

 

Payday loans are predatory
November 10, Billings Gazette
As a former U.S. Air Force air traffic controller for six years, I saw payday lenders prey on men and women in uniform. Financial distress is the top reason military personnel take their own lives. The Military Lending Act gave relief to active duty service members. Payday loans are prohibited under the Act; a protection Montana voters extended to Montana residents in 2010. Soon after the MLA passed, payday lenders around military bases shut down. The MLA only applies to active duty service members, not veterans. This act helps the Consumer Financial Protection Bureau go after illegal debt trap loans that target service-members. Problem is, once you’re out, it no longer applies.

 

Military Lending Act Expanded To Protect Service Members
November 10, Huffpost
If you are one of the brave men and women serving our country in uniform, you face enough dangers. You do not need anyone attempting to take financial advantage of you by capitalizing on the unique challenges of military life.