WASHINGTON – The predatory lending practices of EasyPay Finance and Utah-based, FDIC-supervised Transportation Alliance Bank (TAB Bank) are hurting military servicemembers, veterans, and their families, according to a new report from a coalition of consumer advocacy groups released in advance of Memorial Day.
“There is a clear and compelling public interest that Congress continue to support vigorous enforcement of laws that protect military families from wrongful financial practices… [T]he strong record of the Consumer Financial Protection Bureau and its Office of Servicemember Affairs underscores the need for Congress to resist efforts that seek to hamstring this work. Tampering with the agency’s authorities, structure, and independence would be harmful to military families and honest companies across the country.”
“Mr. Kantwill’s appointment, along with the retirement of Holly Petraeus, who has led the Servicemember Affairs office for the past five years, highlights the CFPB’s extensive work on behalf of military personnel, veterans, and their families, long a favorite target demographic for financial predators.”
“New Defense Department rules against predatory consumer lending to military personnel and their families take effect today. With proper enforcement, they should go a long way toward closing the loopholes that for nearly a decade have allowed some high-cost lenders to evade the 36 percent annual interest-rate limit of the Military Lending Act.”
“The Military Lending Act [restricts] small-dollar, short-term lending practices, but lenders have found many ways around the law. The Defense Department has proposed beefing up the act… so that it applies to ‘all forms of payday loans, vehicle title loans, refund anticipation loans, deposit advance loans, installment loans, unsecured open-end lines of credit, and credit cards…’ A number of financial services industry associations believe the current proposal… takes the wrong approach… [But] the Consumer Federation of America, the National Consumer Law Center and Americans for Financial Reform all support the expansion.”
“When these financial predators come after them, I feel ashamed for the rest of us,” Sen. Warren tells former Rep. Patrick Murphy. She goes on to praise the Defense Department’s new Military Lending Act rules, the CFPB’s Office of Servicemember Affairs, and (responding to a comment by Murphy) Americans for Financial Reform. “Yes, they’ve been terrific.”