Bill could spell pay dirt for payday lenders
Legislation for 'payday advances'
The oddest of state legislative odd couples — Rep. Steve "Thunder" Tumlin, R-Marietta, and Rep. Al Williams, D-Midway — want to repeal a law that cracks down on predatory payday lenders, leaving critics to wonder why and why now.
The law, passed in 2004, outlawed short-term, high-interest loans known as "payday advances." Extra fees sometimes caused the interest rates for such loans to top 1,000 percent. The law threatened lenders who make "payday advances" with racketeering charges that carry up to 20 years in prison and a $25,000 fine per transaction.
The measure, which is cosponsored by Tumlin and Williams, would significantly water down those penalties.
Attorney General Thurbert Baker is on the record saying payday-lending institutions should be strictly regulated. So is Gov. Sonny Perdue, who signed into law the stricter criminal penalties on payday lenders that exploit Georgians with high interest rates.
Allison Wall, executive director of the consumer-advocacy group Georgia Watch, says no one can get an answer as to why Williams supports the consumer-unfriendly legislation. Williams did not respond to requests for comments from CL.
As for Tumlin, the Marietta representative pointed out that his bill imposes a daily $1,000 fine on lenders who violate the law. "It's [still] tough," he told his colleagues on the committee.
But Wall says she can't figure out why Tumlin wants a strong, pro-consumer law repealed. "What Tumlin is saying is that the governor and leader of his own party signed a bad bill into law," she says.