Bell backs Suthers on protecting payday loan reforms
Federal legislation has been proposed that would undo payday lending reforms enacted in Colorado and many other states, and it would prevent states from regulating these high-cost loans in the future.
We're happy to say that Attorney General John Suthers has joined 40 other attorneys general in opposing this legislation. The Bell is a member of the Coloradans for Payday Lending Reform coalition, which sent out this release yesterday.
CPLR backs Attorney General Suthers in opposing federal bill
that would undo CO payday lending reforms
Coloradans for Payday Lending Reform (CPLR) stands squarely behind Attorney General John Suthers in his opposition to federal legislation that would override Colorado's 2010 payday lending reforms. Recent data from the Attorney General's Office shows these reforms are working.
Attorney General Suthers has joined his colleagues from 40 other states, both Republicans and Democrats, in opposing H.R. 6139, which would pre-empt state laws governing consumer lending. "H.R. 6139 would turn back existing consumer protections and curtail all future efforts by the states to enhance their consumer safeguards," according to the letter signed by Suthers and his colleagues.
Attorney General Suthers is an effective regulator and his office is doing a good job enforcing Colorado's payday lending laws. Over the years, his office has filed suit to stop payday lenders from illegally selling loans in Colorado over the internet. It has gone to court to stop others from skirting Colorado law by using sham corporations located on Indian reservations. We strongly back Attorney General Suthers' current efforts to oppose federal legislation that would unravel the progress we have made in improving payday loans in Colorado.
H.R. 6139 would move oversight for non-bank lenders from the Consumer Financial Protection Bureau (CFPB) to the Office of the Comptroller of the Currency. This would allow non-bank financial services firms such as payday lenders to bypass the CFPB and stronger state laws and offer their high-cost loans and services nationwide. It would totally pre-empt state licensing laws for non-bank financial services firms including recent reforms passed in Colorado. In place of state safeguards, it would establish only minimal consumer protections.
The bill would exempt loans with terms of one year or less from the disclosure requirements of the Truth in Lending Act – the universal standard for measuring the true cost of credit – and substitute a cost metric that is confusing and misleading.
The attorney generals also point out that it would prohibit them from enforcing state laws that were carefully designed to address problems in the local market and significantly impair their ability to respond in a targeted fashion to new abuses as they emerge.
H.R. 6139 would hurt Colorado consumers and limit our ability to develop effective, local solutions that meet our needs. It would undo all the hard work that Coloradans put into reforming our payday lending laws.
We stand behind and fully support Attorney General Suthers in his opposition to this legislation.
Article posted on October 18, 2012