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Saslaw, Virginia Senate move to expand predatory lending

Posted by Stephen on February 14, 2008

In an act that can only be described as disgraceful, the Virginia State Senate passed a proposal that will not only avoid reform for the predatory industry of payday lending, but it actually expands the base for their vicious lending practices.

The Senate, not wanting to be left out of the political spotlight, had to do something. Unfortunately, their idea of action is to continue to promote exploitation of the most vulnerable citizens in Virginia.

The Republicans in the House came up with a proposal for a compromise and then the House Democrats joined in to create strong bipartisan support.

However, the Senate felt a need to trump the House move by submitting a bill that eliminated all of the most important elements of the House bipartisan compromise.

As a result, Senator Saslaw, who served notice long ago that he was an ally of the predator industry of payday lending, and his colleagues ignored the House compromise, ignored the call for reform by Governor Tim Kaine, ignored the statement from Attorney General Bob McDonnell, and ignored the overwhelming majority of people in the Commonwealth simply because their arrogance undermined common sense, fairness, and decency.

It does little to help with the cycle of debt. While it maintains the “one loan at a time provision,” it does little else for the consumer. It does, on the other hand, improve the position of the industry. They would maintain their current fee level; add a $10 dollar fee (twice the amount in the House bill) plus 36%. This is a gross misuse of the 36% cap. It is simply another way for the industry to create the same type of loop hole that has allowed them to exploit Virginians for the past six years.

While Saslaw and his cronies laugh all the way to the bank, the bill makes a mockery of reform.

The House bill calls for a data base to track consumer loans to prevent a person from having more than one loan at a time. The Senate bill includes the data base and then guts any accountability by lenders by exempting lenders from any liability if there are mistakes in the information in the database.

As a result, they could knowingly put false information in the database, and be exempt from penalty. Particular lenders, such as Check n’ Go, have already been rightfully accused of intrusion into personal accounts of customers, and manipulation of the truth.

The unethical practices of payday lending make it easy to understand why AG McDonnell would ban internet lending. Yet, the industry thumbs its nose at any and all levels of authority and Senator Saslaw continues to come to their rescue.

The Saslaw bill actually authorizes internet payday lending, and allows stores that have a Virginia license to offer payday loans to people from other jurisdictions like Washington D.C. or North Carolina.

Senator Saslaw, clearly sitting on a high horse, thumbs his nose at the people and legislatures of North Carolina and Washington D.C. by allowing lending across state lines. Saslaw is consumed by the industry, but the fact that the body of the Senate would condone such contemptuous actions by ignoring the desires of bordering states to promote a devious practice stupefies the mind.

Saslaw should be condemned for his defiant actions. The Senate should be ashamed of themselves for treating the citizens like they were idiots incapable of seeing through the smoke and mirrors of high priced lobbyist paid millions of dollars by an industry dripping with deceit and contempt for society.

It is a greed driven predatory practice that is supported by elected officials either ignorant of the facts regarding the practice of predatory payday lending, or accomplices in the industry’s successful efforts in the fleecing of Virginians.

There is an unprecedented level of shame hovering over the Virginia State Senate and each member of that body has disgraced the great history of political leadership in this, the Commonwealth of Virginia.

Stephen Winslow is the executive editor of Conservative Viewpoints and a former manager of a payday lender.

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