Saturday, May 31, 2014

Payday Lending: A New Court Victory, Two More Cities Protect Their Citizens and a New Movie Details the Threats!

Thanks to Jim Mitchell of the Dallas Morning News for a great story regarding the fate of payday lenders. In a recent blog post, Jim lets us know that the payday lenders have lost again in court...

"The coalition of cities  standing firm against abuse payday lending practices continues to grow. As important, the courts are backing local regulations to control payday lending. On Friday, an appeals court upheld the authority of Dallas’ landmark rules restricting certain  payday operations and practices"
"All I can say is great news..." 
And all I can add to this is 'Amen'! Dallas' ordinance is holding up through legal channels. And though I fully expect this to end up in the Texas Supreme Court, I also expect that should that court be made known of the eggregious usurius practices of this industry, it may threaten to severely curtail those practices. So yes, this, along with the fact that Baytown, Texas, a suburb of Houston has now adopted this ordinance - providing financial protection for more than 7 million Texans - is indeed 'great news'! 

And even more good news, in San Antonio, where I was told government was balking at the prospect of actually enforcing their payday lending laws...guess what? They are prosecuting! And pretty vigorously, at that...

"Some two years after the City Council cracked down on predatory lending practices, San Antonio officials said Thursday they are prosecuting seven payday lenders for allegedly violating a city ordinance that mandates fair practices."
"The defendants face fines up to $500 for each alleged violation and for each day the violation may have occurred."
"The payday lenders facing prosecution are accused of conducting business without the required city registration certificate; four of the seven also refused to allow the city to inspect their business records, a requirement in the ordinance."
"“Our primary concern is compliance. At the end of the day, the interaction between the lender and the consumer is what's most important to us,” said Councilman Diego Bernal, who spearheaded the creation of the payday lending ordinance. “The lenders have to recognize that we're serious about our commitment to treating people fairly and following the law.”"
"More than 200 payday and title loan lenders operate in San Antonio, and 96 percent have been compliant with the ordinance, city officials say....
...“"The good news is that the ordinance does have teeth, and it matters,” City Attorney Robbie Greenblum said. “Most everybody is in compliance. The very few who aren't in compliance have been or will be prosecuted.”"
Now you see why lobbyists for the industry were trying to get rid of these local controls in the last session. 
In the meantime, the attack on this business is hitting another front: cinema! 'Spent: Looking for Change' is a documentary which, again, outlines the greed of payday lenders, check cashers and other places that appear to be the last resort for the 'unbanked'. It's clearly an important film. CitySquare's Public Policy Department is trying to obtain the rights to screen it. 
I was sharing this news with Dallas City Council member Jerry Allen, our city's champion on the fight against payday lenders, while I can't repeat all that he said, it's enough to say that it leaves us both very excited about the fight.

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