Speaking of combat | Arkansas Blog

Thursday, September 14, 2006

Speaking of combat

Posted By on Thu, Sep 14, 2006 at 2:36 PM

No more Mr. Nice Guy for A$a. (Although, actually, this issue has been bubbling for some time.)

A$a! comes out swinging against Mike! on payday lending. Beebe has some defense. He's suing some of the money-suckers currently. He was on the right (losing) side of past  legislative battles. But the predators ARE operating in Arkansas and Beebe is taking their money. Some money is too blood-stained to accept.

News release on the jump.

HUTCHINSON NEWS RELEASE

Little Rock –  Asa Hutchinson, the 2006 Republican nominee for Arkansas Governor, said today that his opponent, Democratic Attorney General Mike Beebe, has been ineffective in the fight against predatory lending in Arkansas, all the while accepting campaign contributions from the industry.

Hutchinson referenced recent reporting from Arkansas Business, a weekly newspaper in Little Rock, detailing contribution patterns from payday lenders in the 2006 election cycle. (“Democrats Favored With Most Payday Lender Contributions,” James Gordon, Arkansas Business, Sept. 11, 2006)

According to the report, of the at least $60,000 donated to political parties and candidates in 2006 by payday lending companies, virtually all of the funding went to the Democratic Party of Arkansas and Democratic candidates, including Beebe, who received at least $4,000 directly to his campaign from payday lenders.

“I’ve made it clear that, as Governor, I will take action to put a stop to abusive lending in Arkansas by revoking the 1999 Check Cashers Act, which has allowed unscrupulous lenders to exploit the poorest and most vulnerable of our state’s citizens,” Hutchinson said. “Does Mike Beebe share the same commitment? Based upon his apparent conflict of interest in taking money from these lenders for his campaign, it appears that the answer is ‘no.’”

Hutchinson noted that Mike Beebe has had four years as Attorney General to combat payday lending in Arkansas, but has only taken action on a handful of occasions to target abusive lending.

“As Attorney General, Mike Beebe has had four years to take action against these bad actors and has failed to do so,” Hutchinson said. “He has taken their money instead. He did not make reforming the predatory lending practice part of his legislative agenda as Attorney General, and he failed to aggressively pursue legal action until now, during a campaign year.”

In an April speech to the West Little Rock AARP seniors’ organization, Hutchinson announced that, if elected, he would lead the charge to revoke the 1999 Check Cashers Law, which has allowed payday lending companies to exploit the poorest and most vulnerable Arkansans. He also called for a penalty fine provision to put teeth into the state’s usury law.

Hutchinson noted that these two actions would serve to protect low- and middle-income Arkansans from the spiral of debt and exorbitant interest that accrue in predatory lending transactions. Among the victims of these exploitative lending practices are African-American families, senior citizens, military personnel and college students.

One provision of the 1999 Check Cashers Act allows payday lenders to charge fees and interest rates in excess of the state’s usury limit of 17 percent, as laid out in the Arkansas Constitution. The result is that borrowers frequently find themselves paying triple-digit interest rates on short-term loans, creating a debt spiral from which they cannot escape.

“It’s time for leadership to address this exploitative practice,” Hutchinson said. “While working families and our state’s most vulnerable citizens are being targeted by unscrupulous lenders, Mike Beebe has essentially sat on his hands while accepting the lenders money for his campaigns. I’ll work with the legislature to shut down abusive lending in this state.”

 “This is certainly something that the Legislature should address, and as Governor, I’ll work with lawmakers to correct this exploitative law,” Hutchinson said. 

Hutchinson first denounced the practice of predatory lending in December 2005.

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