Texas Payday Lender Lobby Unmasked and Disrobed
82 Industry Lobbyists Bill Up to $4.4 Million
Predatory lending industry insiders are currently paying over eighty lobbyists as much as $4.4 million dollars to combat meaningful reforms of what is possibly the nation’s largest unregulated market. This after they spent $4 million between 2009 and 2012.
The payday lending industry is facing opposition around the nation. The District of Columbia recently sued Loan Max, alleging that the lender was charging annualized interest rates exceeding 300 percent. Loan Max settled out of court by refunding cash and returning repossessed cars.
In Texas, where regulation of this industry is almost non-existent, interest rates soar as high as 1000%. More than 35,000 Texans lost their cars to auto title lenders in 2012.
Predatory lenders have been pushing Texas lawmakers to prevent Texas cities from enforcing their own regulatory ordinances on the industry. The amount of money being spent in Texas by payday and auto title lenders is enormous. There are only 16 states that do not regulate this industry. Of those, Texas is the biggest prize. Hence the money that is pouring in during the 83rd session.
Senator John Carona, author of SB 1247, made an interesting and revealing statement, all but confessing that Texas legislators work for the special interests that pay them.
“This is the only version that will pass this session,” Carona said. “I am convinced the industry has given as far as it intends to go.”
The “industry” as gone as far as it will go. Really? Since when does an industry determine how much regulation and legislation we will be allowed in Texas. Who exactly is in charge here?
This month Texas House members will decide whom they most represent. Is it the more than 35,000 Texans who had their vehicles repoed by predatory lenders last year? Or is it the two dozen, mostly out-of-state predatory PACs and executives who gave current House members more than $1.3 million?