What is Sen. Lincoln up to? | Arkansas Blog

Wednesday, July 9, 2008

What is Sen. Lincoln up to?

Posted By on Wed, Jul 9, 2008 at 11:07 AM

The people going after the bloodsucking cash advance/payday lending industry want to know what Sen. Blanche Lincoln is up to.

Legislation she's introduced -- here and here -- would override the state Constitution's limit on interest as it pertains to cash advances on checks and other retail lending. Yes, the language says the interest cap would remain 17 percent. But lawyers believe other state consumer protection laws would be overridden in the process, laws that are now being used to make recoveries for victims of the loan sharks. And with the Constitution overridden, the lawyers wonder if the special interest-owned legislature could step in and impose whatever limits it wanted, if any, for the payday outfits.

Lincoln's legislation would apply only to Arkansas. In one lawyer's opinion, it would also breathe new life into the title pawn business, a loan sharking activity stomped out by Attorney General Winston Bryant more than a decade ago. People victimized by excessive interest by such lenders would only have recourse in federal court, based on recent court decisions.

"It's outrageous," says Todd Turner, the Arkadelphia lawyer who's been pursuing the bloodsuckers for nine years. "I can't believe that my U.S. senator is working to override the state Constitution without a vote of the people."

UPDATE: Late in the day, I got in touch with Sen. Lincoln. She says Turner misinterprets the measures, which she says are aimed at helping small businesses not included in legislation several years ago that gave some exemption from usury limits to banks and need more interest flexibility. More on the jump.

Sen. Lincoln said the agency most in need of the ability to have higher interest rates is the Arkansas Student Loan Authority,which borrows money for loans, but which is limited to the interest it can charge on bonds sold to produce the loan money. The limit is 5 points above the federal discount rate (currently 2.25 percent) or 17 percent, whichever is lower, and the lower rate isn't marketable, she said.

But Lincoln said that low interest ceiling also affects furniture stores and other small retailers. Moving the interest rate up to 17 percent (from 7.25 percent) would help them, but still keep a cap in place. It wouldn't override constitutional limits except up to the 17 percent level and that's not high enough to satisfy payday lenders, she said. "They've complained about this legislation," she said.

"We've worked very hard to be sure we do protect consumers. We are in no way here trying to do anything to advance any bad actors, whether it's payday lenders or anybody else."
She said she'd talked with Attorney General Dustin McDaniel, who's been moving to shut down illegal payday lenders, and said he had not objections to the legislation, which enjoys support from the whole delegation.

Sign up for the Daily Update email
Favorite

Comments (17)

Showing 1-17 of 17

Add a comment

 
Subscribe to this thread:
Showing 1-17 of 17

Add a comment

More by Max Brantley

  • We have met the enemy: The open line

    The open line with a dose of Trump and other unhappy news.
    • Jul 15, 2018
  • Welcome to the United States, children

    Recommended reading: The New York Times' report on the conditions for the hundreds of children being held in detention since they arrived at U.S. borders seeking asylum. There are many rules and they included no touching of other children, not even a hug for a little brother or sister.
    • Jul 15, 2018
  • Bills arrive for petition campaigns, including term limits

    Filings are expected next week on the campaigns to put a minimum wage increase and casino gambling expansion on the November ballot. One other campaign reported financial information last week
    • Jul 15, 2018
  • More »

Readers also liked…

  • Women's March planned in Arkansas to mark Trump inauguration

    Speaking of Donald Trump and in answer to a reader's question: There will be a women's march in Arkansas on Jan. 21, the day after inauguration, as well as the national march planned in Washington.
    • Dec 30, 2016
  • Your daily dose of Jason Rapert

    Sen. Jason Rapert really, really didn't like it when a KATV reporter asked him about the hypocrisy of his political arguments.
    • Feb 4, 2017
  • Campus gun bill clears committee

    The so-called compromise amendment that will allow anyone 25 or older with a training certificate carry a concealed weapon on public college campuses was approved in a Senate committee this afternoon.
    • Feb 21, 2017

Most Viewed

Most Recent Comments

Slideshows

 

© 2018 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation