Politics
Politics

Republicans Try To Stop Predatory Lending Safeguards For U.S. Troops

| by Alexander Rubinstein

House Republicans are attempting to block measures meant to protect members of the U.S. military from predatory loans. After previous failed attempts to hamper protective legislation, they are now trying to amend the National Defense Authorization Act -- a bill responsible for military funding -- with unrealistic technical certifications meant to block the U.S. Department of Defense's effort to protect troops.

In 2006, Congress passed legislation to reduce high-interest credit, like payday lending, aimed at exploiting U.S. troops. But lenders found loopholes that enabled them to work around the law. Congress acted again in 2012, allowing the Pentagon to close those loopholes.

In 2015, congressional Republicans on the House Armed Service Committee and industry lobbyists united to add a provision to the spending bill, which was meant to delay the implementation of the new rules for one year. The provision failed, but only narrowly, due to the defection of five Republicans. Democrats voted unanimously in support of the amendment that blocked it.

Now, Rep. Steve Stivers will propose legislation to amend the NDAA with unrealistic technical certifications, which if not met would undo the DOD’s efforts. Stivers, a Republican from Ohio, is popular in the payday lending industry. In two election cycles, payday loan companies contributed $69,625 to his campaign, reports MSNBC.

“It's almost too difficult to believe that you'd have a member of Congress looking to carry water for the payday loan industry, and allow them to continue to target in a predatory fashion military families who in many cases are already in a vulnerable financial state,” White House Press Secretary Josh Earnest said.

Earnest noted that many of the people affected by predatory loans are the military families with loved ones overseas. He added, “To allow predatory lenders to target them is something that I can't imagine earning the majority support in the United States Congress.”

Thousands of those in the military fall victim to short-term and high-interest loans every year, reports The Huffington Post. The report also documented a number of abusive practices by the industry. One borrower took out a $485 loan. In just six months, he owed $1,428.28.

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Sources: The Huffington Post, MSNBC

Photo Source: Wikimedia Commons

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