Wednesday, February 6, 2013
Payday and Auto Title Lenders Lose in Court
The best news I received yesterday!
"This morning, District Judge Eric Moye dismissed a lawsuit filed against the city of Dallas in hopes of halting its regulation of payday and title loan operations."
"The dismissal on jurisdictional grounds means that the city can continue to regulate not only where payday lenders operate but how they issue loans and what they charge in interest and fees."
"Backers of the city’s strict payday lending ordinance praised the ruling as a boon for poor communities that they believe are preyed upon by lenders who offer complex loan products and charge usurious rates during repayment."
"The ruling “really solidifies the city’s right to regulate these businesses in their own jurisdiction,” said Rev. Gerald Britt, of the non-profit CitySquare."
"Britt said the idea that Dallas couldn’t regulate lenders was ridiculous."
"“The city regulates private businesses all the time,” he said."
"The organization that filed the suit, the Consumer Service Alliance of Texas, can appeal the ruling. The city’s ordinance can also be challenged in court if the city attempts to criminally prosecute a payday lender for a violation of the ordinance."
"The importance of the ruling is amplified because several other major Texas cities, including Austin, San Antonio and El Paso, have all followed Dallas’ lead in adopting payday lending ordinances."
"The ordinances were widely seen as a response to what cities saw as lax regulation from the state. Cities across Texas, including the suburbs, have seen payday lenders proliferate."
"Led by council member Jerry Allen, the Dallas City Council adopted an ordinance in June 2011 that forced payday lenders and title loan shops to register with the state."
Read the rest of the article here...