Payday lenders hire ex-regulators to lobby for them - PeachParts Mercedes-Benz Forum

Lebenz · #1 03-08-2005, 11:38 AM

Just goes to show that even thieves can prosper if they pay off the gov, er lobby....

Payday-loan companies have stepped up their political profile in Olympia this session in an effort to beat back proposals that would more tightly regulate the fast-growing industry.

The industry has hired as lobbyists two former directors of the state agency that regulates payday loans. And in 2004, the state's Top 10 payday-loan companies boosted their political contributions almost eightfold to nearly $200,000.

The strategy appears to be paying off.

Nine legislative bills that would have reined in the industry's most aggressive and controversial practices — and which were opposed by the industry — have stalled in committee. Five more remain, but observers say they lack teeth.

The lobbying work is part of a nationwide move by the industry to boost its political power, and hiring top former regulators is typically a part of that strategy, said Jean Ann Fox, director of consumer protection with the Consumer Federation of America.

Payday loans are short-term loans that almost always carry triple-digit annualized interest rates. The dollar amount of these loans grew by 84 percent in Washington between 2000 and 2003, accounting for more than $1 billion in loans. Nationwide, the industry loaned out $40 billion in 2003.

But with that growth has come controversy. The industry says it's growing because there's demand for short-term loans to tide people over until the next paycheck, and that the businesses are upfront about the terms of the loans. Critics contend the high interest rates charged on the loans, which frequently reach 390 percent or more, affect people who can least afford to pay them. Those financially strapped consumers sometimes fall into a troublesome cycle of short-term borrowing, taking out one payday loan to pay another, compounding their debt woes.

http://archives.seattletimes.nwsource.com/cgi-bin/texis.cgi/web/vortex/display?slug=payday07m&date=20050307&query=lending

GermanStar · #2 03-08-2005, 11:45 AM

It's amazing what they call "industry" these days...

el presidente · #3 03-08-2005, 12:19 PM

Interesting.

Which came first? The chicken or the egg?

mplafleur · #4 03-08-2005, 12:28 PM

Moneychangers!

koop · #5 03-08-2005, 12:31 PM

like the man said, you can steal more with a pen than a gun

H2O2 · #6 03-08-2005, 12:49 PM

Those scumbags crop up around military bases and low-rent districts to feed off of, and perpetuate poverty and dispair. A few years ago, there was a legislator up in Tacoma who tried to pass a bill that would force the "industry" to be labeled as Legalized Loan Sharks--truth in advertizing.

GermanStar · #7 03-08-2005, 12:50 PM

Quote:

Originally Posted by el presidente

Which came first? The chicken or the egg?

Neither one -- the rooster came first...

el presidente · #8 03-08-2005, 01:07 PM

They should outlaw payday lenders, check cashing places, cat houses and roach motels. In fact, mainstream banks should be required to give loans to these people be preyed upon by those vicious businesses.

kknudson · #9 03-08-2005, 01:08 PM

First alcohol was banned, the crime families ran liquor.
Then the goverment stepped in and taxed it.

Then there was the numbers game, the crime families ran it.
The goverments created Lotto and taxed it.

Gambling was only legal in Vegas, and the crime families ran it.
The goverments legalized it and taxed it.

Then there were Juice loans, and the crime families ran it it.
Now there are payday loans and the goverment taxes them.

So my question is did the crime families takeover the goverment, or did the goverment take over the crime families ?

Or maybe it was a friendly merger.

H2O2 · #10 03-08-2005, 01:38 PM

A.K.A. symbiosis

koop · #11 03-08-2005, 02:00 PM

In Florida they had bolito, an illegal numbers game. Pick three and win $750.

Then they brought in the lotto. Pick three and win $500.

It always amused me that the mob had a better payout than the state.

aklim · #12 03-08-2005, 09:02 PM

Please don't steal. The government hates competition and will do all in it's power to squish it and take it over.

So what about these loan things? I don't see a problem. The loan shark will charge you the same or more anyways. Might as well be them because they pay a tax and the loan shark doesn't.

Kuan · #13 03-08-2005, 09:12 PM

People have to get loans to cover their loans to the govt. until the govt. repays them without interest sometime during the first half of the year.

H2O2 · #14 03-08-2005, 09:59 PM

I guess if the idea of loan sharking poor people doesn't make you morally queasy, then it probably ain't a problem--for you.

aklim · #15 03-08-2005, 10:06 PM

Quote:

Originally Posted by H2O2

I guess if the idea of loan sharking poor people doesn't make you morally queasy, then it probably ain't a problem--for you.

It's like prostitution. Will it happen anyways? Yes. Better some regulation than no regulation. At least, they don't send Guido who takes care of things, all kinds of things, to collect.

Loan sharking is loan sharking. Poor or rich doesn't make any difference to me. If it is bad, it is bad whether you shark some bum or Bill Gates. In any case, they are adults. Oh well.