Madigan Urges Department of Defense to Strengthen Protections for Service Members Targeted by Predatory Lenders

June 24, 2013
Rock River Times  
payday lending news

With a dozen other attorneys general lined up in support, Illinois AG Lisa Madigan has petitioned U.S. Secretary of Defense Chuck Hagel to sew up loopholes in the Military Lending Act (MLA) that have allowed predatory lenders to continue taking advantage of service members. The 2007 federal law placed a 36 percent limit on interest and fees that could be charged to enlisted persons, but it narrowed the restrictions to cover only specific products. Payday loans of up to $2,000 and for a term of no longer than 91 days, tax refund anticipation loans, and auto title loans were pigeonholed by the act; but predatory lenders have responded by offering loans from $2,001 and up or imposing a minimum repayment period of 92 days, for example. In a letter to Hagel, Madigan and her counterparts in California, Delaware, Florida, Indiana, Kentucky, Montana, North Carolina, Nevada, New York, Oregon, Tennessee, and Washington argue that the consumer protections in the MLA should apply to all consumer credit loans.
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