Excerpts:
Joe Baca weakens regulation of Payday Lending Industry
Rep. Luis Gutierrez (D-Ill.), chairman of the subcommittee with authority over consumer credit issues, had once advocated extending to all Americans an effective ban on payday lending for military personnel that Congress passed in 2006. By last year he had scaled back, urging an amendment that would have limited to six the number of loans a borrower could receive in a year.
Gutierrez’ less-restrictive amendment died when Democrats including Rep. Alcee Hastings (D-Fla.), threatened to vote against the entire consumer protection act if the payday provision was included. It also faced opposition from Rep. Joe Baca (D-Calif.), who countered Gutierrez with an amendment the industry regarded as favorable because it had the potential to open payday lending to new markets. Baca said in a statement last year that while "fly by night lenders" should be banned, he wanted to “ensure that students, blue collar workers, teachers, police officers and others have access to legitimate payday advance loans if needed."
All of the lawmakers – as well as many of their colleagues on the House Financial Services Committee – have received campaign contributions from the industry, its executives, employees and lobbyists. Since 2006, Gutierrez has received $38,550, Baca $16,250 and Hastings $13,500. Almost all of Baca’s contributions were reported during the last half of 2009, as the financial reform bill took shape. Chairman Frank has received $12,300 from the industry’s political action committees since 2006, and last year even Speier received some donations from the payday industry’s PACs: $3,500.
Gutierrez, Baca and Hastings declined requests to be interviewed for this story.
Kevin Kimble, Co-Founder & Director of Policy Development
Another slide, from a presentation by Kevin B. Kimble, a vice president of Cash America, the nation’s largest supplier of pawn loans, and William Sellery Jr., a top FiSCA lobbyist, warned: “Payday lending now in play.” They characterized the industry’s strategic response as an “aggressive, multi-pronged defense” of payday lending, including not just traditional means of influence but creation of organizations such a “Coalition for Financial Choice” to counter the image of payday lenders as debt traps. The group’s Web site,www.coalitionforfinancialchoice.org, describes financial services as a “fundamental right” and urges supporters to refer to themselves as “pro consumer choice.”
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