Ohio payday lenders, still smarting from their punch in the face, are turning to lies and deceit to qualify a ballot initiative that would overturn the state’s recently approved usury limits. The industry’s petition gatherers are telling people that the initiative would “lower interest rates,” even though it would raise the maximum allowable APR from 28% to an astounding 391%. They’re also giving dollars to illiterate homeless people who sign the petition.
Serve City director Kay Waldo said she felt the people at the shelter were victims of a crime.
“Absolutely,” she said. “I think they take advantage of the people here. I really do.”
Waldo claimed that some of the people at the shelter don’t even know how to read.
“They’re being asked to sign something without even being able to read it,” she added. “It’s a crime as far as I look at it.”
“If something was said incorrectly, let the circulator’s name be obtained and we will take swift action to investigate and remove that employee if necessary.” Norris added.
The payday lending industry, of course, has plenty of experience taking advantage of people.
WCPN produced a segment on the dirty industry’s dirty campaign:
We’re won’t feign surprise that payday lenders are resorting to underhanded tactics. Usury laws, election laws, ethics; it’s all the same crock of unreasonable bullshit to them.
Ohio Payday Lenders Caught Lying in Ballot Initiative Signature Drive [Consumer Law & Policy Blog via Caveat Emptor]
Payday Loan Petitions Doubted [WCPN]
Ohio Payday Lending Law Change Battle Heats Up [WCPO]
PREVIOUSLY: Ohio Passes Legislation That Will Punch Payday Lending Industry In The Face
Ohio Senate Passes Strict Lending Legislation, Prepares To Punch Payday Lenders In The Face
Ohio Punches Payday Lending Industry In The Face, Breaks Its Nose, And Laughs
(AP Photo/Seth Perlman)
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@Pylon83: Are you then in favor of people being allowed to sell their children? It’s simply a market exercise redistributing children from people who have a surplus to people who need them. And believe you me, an AWFUL lot of people want to engage in child-selling. When I worked at a newspaper, we used to get classified ads ALL THE TIME from people attempting to illegally purchase children.
Hell, slavery’s just an economic transaction … and having just spent a day at the new Lincoln Museum in Springfield (which was awesome!), I can tell you that “free market, feds shouldn’t interfere” was a major argument to keep slavery intact. “If the free market doesn’t want slavery, slavery will go away on its own,” they said. “People will make other choices.” Except the enslaved ones, one presumes.
@laserjobs:
You can say the same about meth dealers and organized crime.
@Eyebrows McGee:
Obviously I don’t believe the free market should be taken that far. I do believe prostitution should be legal, licensed and taxed. However, those that take my statements to the extreme (Selling children or selling sex with children) are just ridiculous. For one, the idea of individual liberty overrides any freedom of contract ideals I may hold. People should be able to make decisions for themselves, and the governments places is simply to make sure that those decisions don’t affect other people adversely. Selling your child or another person clearly adversely affects the child’s or that person’s individual liberty. However, anything short of that should be allowed, subject to a very few overriding exceptions (illegal drugs, food subject to FDA requirements, etc.). I simply don’t feel that payday loans are on the same level as illegal drugs and possibly tainted food as to require government regulation. There are obviously limits to a free market, but payday loans most certainly fall well within those limits.
@laserjobs: “…putting them out of business for some political reason…” What political reason would that be? Where is your evidence?
The “Banking Industry”?? Why would they want to do that? If this was a real honest way to do business, banks would offer these same kind of loans at the same kind of interest rates and CLEAN UP.
@Pylon83: “The government isn’t supposed to be a babysitter to protect people from themselves.”
So we can get rid of drug and seatbelt laws right now. And disband the TSA. And Homeland Security. etc. etc.
@brent_r: I found the farmer ad.
Oh no, what will that poor farmer do if he can’t fix a belt on his truck for 391% interest?
@doctor_cos:
You miss my point. I said protect people from THEMSELVES, not from others (in reference to your TSA and Homeland Security post). I am not a fan of seatbelt laws either, as it’s a program simply to protect people from themselves. Don’t want to wear the seatbelt? Who cares, it doesn’t affect anyone else (directly at least). Drug laws are another story. I’m willing to relent and accept drugs laws based mostly on the attempt to avoid the dangerous environment that drugs tend to create (General crime, racketeering, etc.).
@Pylon83:
What did people do before there were payday loans?
@mechfluff:
Yeah, there’s another one featuring a “single mom” who says something to the effect of “Oh noes! What if junior gets sick before payday?”
They’re all over Ohio TV right now. I hope the pro-side starts up some ads soon before everyone only gets the anti-side position.
@JollyJumjuck: Really. They would have our government dismantled and have our country reduced to thirdworld status in short order. It’s pretty scary.
The 391% interest is not a valid argument. If it takes you a year to pay it off, then you shouldn’t have gotten the loan in the first place. I know friends and people in my extended family who have used payday lenders responsibly for emergency expenses. This legislation will put most (if not all) of them out of business. It is up to the individual to understand whether or not they can afford it, not the government.
@laserjobs: Crack dealers would not exist if there was not a demand. Ohio putting them out of business is anti-capitalistic and anti-American.
FIFY
@Pylon83: “The government isn’t supposed to be a babysitter to protect people from themselves.”
So if I own a shopping mall, and you fall three stories from the food court to Filine’s Basement and end up in a body cast because I didn’t inspect/fix the railing, you wouldn’t sue me? I mean, you should have been looking where you were going, right?
@HurtsSoGood:
Well, that’s not really protecting a person from themselves now is it? It’s protecting a person from another person’s negligence. Further, me suing you has absolutely nothing to do with government regulation. A more appropriate comment would have been “The Government shouldn’t fine me for having a railing that isn’t up to code?”.
@xthexlanternx: It must be something in Ohio that got the attention from all the complaints and what not.Which might not be the case in other states. Ohio seen an issue, and corrected it.
I remember when petitioners pulled this stunt a few years ago in Michigan…we were told their petition was to raise the state minimum wage. Turned out it was a petition to ban affirmative action, which of course passed even after a complaint was raised about petitioners lying to get the bill up for vote in the first place. Now I just don’t sign petitions.
@Pylon83:
Pylon – your arguments pre-suppose that the payday clients are in a position to know better. These aren’t people who went to college, graduated, and decided “Hey, I think it’d be super cool to be poor and live paycheck to paycheck”
We’re talking about an industry designed to prey upon a specific segment of society – people who SHOULD know better, but don’t. That’s why we have social safety nets in this country. Would you argue that the car dealer that kept selling new cars to a man with dementia (old consumerist article) should be allowed to take advantage of someone with diminished capacity?
Investors are allowed to buy stock on margin (to make INFORMED decisions that could be potentially ruinous) precisely because they are informed decisions.
But to each his own – that’s what is wonderful about this country, everyone is entitled to an opinion.
Yes payday loans suck, and it sucks how they use small print and lawyer speak to get people to use the service. But it is a needed service, people who use these know that there are fees attached but they need to for whatever reason. Car, food, medical bills, crack. By forcing the companies to a max of 29% APR, they are driving them all out of business.
$500 x 29% = $145
$145 / 12 (assuming a month to pay back?) = $12.08. Is not enough revenue to pay for overhead, not to mention labor.
What will the people who need these do when they all close down? Go to real loan sharks?
@williehorton: If you believe someone’s trolling, email me at moderator@consumerist.com. Posting that other users are trolls is just name-calling and frankly does little other than to be inflammatory and make the comments even more off topic.
@stinerman: Before payday loans people did without. Car breaks down, you walked, rode the bus, or hitched a ride. Someone gets ill, you suffered, and cut unnecessary expenses. If you cut your cable and cell phone bills, you’d have a couple hundred bucks a month right there. You downsize, get rid of the Lexus and buy a Chevy. There are plenty of things to do without going to a loan shark.
When the payday loan stores are forced out of business, organized crime will step in to fill the need. We will need more police to arrest the new payday loan criminals. Then we can add more inmates to our already overcrowded prisons.
Those who keep saying how much Ohio needs these payday loan places.
Before this bill went into effect. They were all over in Cleveland. In some cases. Less than blocks apart. Now, they are further between. Not all of them mysteriously folded overnight.
The load places that are not out to prey on Ohioans, are still left just as they have been before the bill went into effect.
Limit to 4 loans a year. How is that hurting the good folks of Ohio? Anyone forget the bill addresses the gap of the crooks folding up the table and moving on?
If a person is getting loan after load to cover the loan. There seems to be an issue.A nice sane limit on interest is a great thing. If you think over 100% interest is a good thing. I wonder how much your will to take loans out for.
The bill did not stop anyone from getting advance loans. It just stopped a certain type of practice. There is still 0payday loans. Just much less interest attached to them.
Personally I dislike credit in general. I know it is a part of how our world works, but I still do not like it. Personally, I wish the Government had left the old “anti-loansharking” laws alone. Ya know, the ones that banned lending money with an interest rate.
C’est la vie.
@Pylon83: They do it all the time. Ever hear of RICO laws?
@Paxtez: the math isn’t that simple, interest is compounded. you can’t just multiply the borrowed amount by the percentage, it doesn’t work that way on a mortgage, and it doesn’t work that way on a loan. thats why credit card debt can get so out of hand.
At least one state has closed the door on legalized loan sharking, and organized crime doesn’t like it! This ballot initiative needs to go to hell, and all the other 49 states need to follow Ohio’s lead. They legalized the numbers racket and call it “lotto”. They legalized loan sharking and called it “payday loans”. What is next if we do not draw a line in the sand? Legalizing hit men and calling it “personnel liquidations”?
I’m also of the thinking how these free marketers can keep apologizing for a group of businesses that try their damndest to keep people in their trap. They also routinely try to conceal the truth with confusing language RESEMBLING English.
The reason we ban child pornography and prostitution is to protect women and children from exploitation. It’s also part of the reason we fine those that employ illegal immigrants. Exploiting is EXACTLY what these scumbag payday lenders are doing. They are exploiting those that have no other choice and no other option.
@stinerman: Yeah, I’ve heard of the “single mom” ad. I’d like to see it. If anyone can find it, please post.
I am not sure how it works in Ohio but here you write out a post-dated check to the lender. Dont make the payment, they try to cash the check, in which case, if the amount is over $100, you have just commited felony passing bad checks (the felony amount was set in 1969 and hasnt been adjusted). And our local DA loves bad check prosecutions. At least with a normal loan you dont go to prison for defaulting on it.
How can anyone support this crap…
[www.wcpn.org]
These poor people have nothing to lose and money for Thunderbird to gain. I back ‘em – sign away and Godspeed.
Of course these companies are predatory, of course they are scum. But if one finds oneself in the position of having poor credit and no family for assistance, what can be done? I used a payday lender once – I was just starting a new job and was maxed on credit cards, and had no cash. My car broke down friday and I had to start work monday. The payday company had the money in my account saturday, I got the car fixed, and I showed up to work Monday. I paid off the loan as soon as possible. I wasn’t happy about paying the ridiculous interest rate, but I had no other choice. If these companies were legislated out of business I would not have had the job and might have been evicted later that month.
Yeah, these companies are scum. But that doesn’t mean we should get rid of them.
@Cthulhus-minion: In my area of Ohio, if the check is under $200, the police will do absolutely nothing about it. They tell you that point blank. The officer I spoke with said that if its under $500, it might get looked into if they are having a really, really slow day. He said to file in small claims court and good luck. Oh, and don’t call the person more than once, or you’re just harrassing them.
Wow … some of the comments here are just frightening.
Sounds like Democrats at election time: “are turning to lies and deceit…We won’t feign surprise that [Democrats] are resorting to underhanded tactics. Usury laws, election laws, ethics; it’s all the same crock of unreasonable bullshit to them.”
There are incredible ads on TV in Ohio for this issue by a group with a name that no one could refuse: Ohioans for Financial Freedom. In one, a mother in her kitchen laments that “the politicians” are “at it again… trying to take away my financial choices.” Another shows a farmer-type dude next to a Chevy Silverado and a silo. It’s pretty amateurish but they might be effective. It reminds me of the Smoke Less Ohio campaign than ran at the same time as the Smoke Free Ohio campaign.
Anyway, if you’re tricked into signing the petition, you can get your name removed. More info: [www.cleveland.com]
“When the payday loan stores are forced out of business, organized crime will step in to fill the need.”
Hilarious.
In other words, Mafia-style lending practices are only bad when it’s the Mafia that’s doing the lending. When it’s a government-supported institution doing it, that’s just A-OK.
The payday lenders are lying to Ohio voters in attempt to overturn one of the nation’s best consumer protection laws in November.
Watch here:
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The payday lobby is spending millions on TV to deceive voters and convince Ohioans that 391% amounts to financial freedom! 391% is not freedom, it’s a trap! Payday lenders need to acknowledge that their business is predicated on their ability to trap people in debt!
Payday lending is a scourge on our families, our communities and our economy! VOTE YES ON OHIO ISSUE 5!
[www.yesonissue5.org]