Critics Call Out Lax Utah Payday Loan Policy
By Paul RizzoPayday Loan Writer
This was supposed to be the year that consumer advocates were going to persuade the Legislature to clean up the Utah payday loan industry.
Instead, only one of several reform measures was approved. SB16, endorsed by the faxless payday advance industry and state regulators, establishes financial penalties for payday loan operators that break state law.
Payday loan operator Cort Walker, spokesman for the Utah Consumer Lending Association, said Friday his group is happy with the passage of the Senate bill.
“The passage of SB16 further enhances the ability of Utah to regulate payday lenders while allowing the industry to serve consumers in a responsible manner - it is a win-win for the customer and the industry,” he said.
Critics of the payday cash loan industry, though, said the bill, sponsored by Sen. Ed Mayne, D-West Valley City, didn’t go far enough to protect consumers from the dangers of taking out loans with interest rates of 400 percent or more.
Other measures favored by advocacy groups such as the Coalition of Religious Communities and AARP failed.
House Bill 329, sponsored by Rep. LaWanna Shurtliff, D-Ogden, among other things would have capped the maximum cash advance amount at $500. Shurtliff did not immediately return calls seeking comment about her proposal.
Also failing was HB159, sponsored by Rep. Lorie Fowlke, R-Orem, which would have called for a legislative study of the payday loan industry.
Laura Polacheck, AARP Utah’s associate director, said the legislative session was disappointing from the standpoint of online payday loan industry reform but hopes that she and others have laid the groundwork for real change next session.
