Tag: crl


Payday Loan Business-Center for Irresponsible Lending at it Again!

Yes, the CRL, Center for Responsible Lending, who we in the payday loan industry like to refer to as “The Center for Irresponsible Lending” has done it again. They “helped craft” new federal legislation with the aid of U.S. Sen. Kay Hagan, D-N.C.

The bill, called The Payday Lending Limitation Act of 2010, would modify the Truth in Lending Act. Senator Hagan will introduce it as a standalone today, and again next week as an amendment to the financial regulatory reform bill making its way through the Senate.

And just who is The Center for Responsible Lending?

Herb and Marion Sandler! According to ActivistCash.com:

“Herb and Marion Sandler are the billionaire founders of the Center for Responsible Lending. The Sandlers made a fortune in the subprime mortgage industry, thanks to the success of their bank, Golden West Financial.

Golden West and its subsidiary, World Savings Bank, were among the biggest sources of subprime mortgages, especially of adjustable-rate loans called option-ARMs. Herb Sandler is credited with the invention of the option-ARM, which his bank marketed as “Pick-a-Payment” mortgages. These loans were extraordinarily popular in the years preceding the subprime mortgage crisis, generating billions in profits for the Sandlers’ banking empire.

Recent exposés by “60 Minutes” and the New York Times have focused national attention on the Sandlers’ role in the subprime crisis. The Sandlers’ loans, described in the Times as “the Typhoid Mary of the mortgage industry,” are part of a second wave of toxic debt predicted to default over the next several years, hitting the economy with another $600 billion in losses.

The Sandlers made over $2.3 billion on the sale of their company to Wachovia in 2006, and they have used their fortune to fund organizations advancing their political aims. They have given millions of dollars to left-wing groups, including ACORN (radical activists implicated in election fraud investigations in over a dozen states), and the Center for Responsible Lending (a “consumer advocacy” front-group that lobbied for expanded subprime lending while promoting its funders’ business interests).”

Read more about the CRL Here:

And more here about the Proposed Bill:


Congressional Hearings Confirms That States are Doing a Good Job at Regulating Short Term Lending

If you’ve been in micro-lending for any period of time you’re familiar with CRL – Center for Responsible Lending and Veritec, a regulatory service for various state payday loan compliance monitoring.

The Center for Responsible Lending has attacked the payday loan industry since time began. They never fail to twist any facts presented to them nor do they hesitate to distort the truth. And as  far as suggestions to alternatives for payday loans they offer only one, so elegantly stated by Jean Fox (CRL Director of Financial Services) at Rep. Guiterrez’s hearings on the payday loan industry, “Payday loan consumers should simply ask their friends and family for financial help.”

A review of data revealed by Veritec provides ample ammunition for arguing against the propaganda spit out by The CRL. The only problem is that The Center for Responsible Lending has gotten very good at interpreting this data to support their anti-business leanings.

The Center for Responsible Lending distortions have become so ridiculous that it prompted Veritec to issue a White paper analysis refuting the misinterpretations made regarding Veritec’s data.


If you care about the micro-lending industry (payday loans, pawn, check cashing, car title loans…) you have got to educate yourself and be ready to intelligently defend your business.

The following is a press release issued by Veritec originally appearing here:

Following is Veritec’s statement.

We bring this to you because each of us must do our little bit to intelligently defend our industry. You need solid, accurate information.

So here it is…

Congressional Hearings Confirms That States are Doing a Good Job at Regulating Short Term Lending

JACKSONVILLE, Fla., April 8 /PRNewswire/ — A House Financial Institutions and Consumer Credit Subcommittee hearing held April 2, 2009 for H.R. 1214, the Payday Loan Reform Act, included testimony
about the effectiveness of state payday lending regulation. The testimony emphasized that some states have chosen to strictly regulate short term lending, while other states have simply attempted to ban payday loans by implementing limits on fees based on an annual percentage rate.

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“Several states, including Florida and Oklahoma, are effectively protecting consumers,” said Thomas Reinheimer, CEO of Veritec Solutions of Jacksonville, Florida. “Veritec is at the forefront of implementing effective regulatory enforcement solutions for strong consumer protections required by state law. We see first-hand the impact of good regulation in enabling access to short-term credit while protecting consumers from getting trapped in a downward debt-cycle.”

Unfortunately, certain consumer advocacy groups blindly seek to ban availability of short-term credit without full consideration that their actions limit consumer choice. This near sighted approach often results in consumer usage of un-regulated products such as off-shore Internet loans. Reports published by Veritec, based on millions of actual loan transactions, contradict many assertions made by these consumer activists.

“The hearing provided a clear presentation of the product, how it works, the potential abuses, and what has been effective in addressing potential abuses that occur in the industry. State regulatory data based on millions of actual loan transactions in Florida and Oklahoma, two states that have effectively eliminated
multiple loans and rollovers, clearly demonstrates that short-term lending can be regulated effectively,” said Mr. Reinheimer.

Veritec has published detailed white papers and reports about effective regulation of the payday loan industry, available at www.veritecs.com, that illustrate the following facts:

* Borrowers and lenders are unable to roll-over payday loans in Florida and Oklahoma.
* Over 75 percent of borrowers pay-off their loans within 2 days after the due date.
* Grace periods and repayment plans are available under state law to any eligible borrower who can not  pay off their loans on time.
* Over 25% of borrowers no longer use the product more than one year and a majority of borrowers no longer use the product after 3 years.

A recent press release issued by the Center for Responsible Lending (“CRL”) distorts the truth about consumer protections in Florida and Oklahoma. State law prohibits roll-overs in Florida and actual data from millions of loans conducted by in Florida clearly shows that borrowers do not roll-over their loans. Despite these publicly available facts, CRL continues to disseminate erroneous information. “I simply do not understand why CRL continues to misrepresent the facts,” said Mr. Reinheimer.

“We are concerned that states considering regulation and enforcement of consumer protections may be swayed by misinformation from CRL. Veritec supports effective regulation of short-term lending that provides borrower access to short-term credit products with enforcement of consumer protections. State bans on short-term credit products often have an unintentional consequence of helping unregulated lenders, such as off-shore Internet lenders, by eliminating a consumer’s option to choose a regulated product,” said Mr. Reinheimer. “To better illustrate this, all anyone has to do is to search the Internet for loans available in rate cap states and see that unregulated, unlicensed activity is alive and well.”

Veritec Solutions LLC is a regulatory services company that manages statewide lender compliance programs in eight states with statewide databases and related limits included in their respective payday lending (aka deferred presentment, deferred deposit) statutes. Veritec helps state agencies regulate lenders through the
management of these programs. Veritec’s primary customers are state regulatory agencies; the firm does not supply any goods or services to the payday lending industry.

SOURCE Veritec Solutions LLC
And here is a link to the 15 page White Paper at their web site:

Comment? Question?


CRL Center for Responsible Lending Takes More Hits

Looks as if more and more folks are realizing The Center for Responsible Lending is anything but an unbiased, consumer protectionist organization. Like the old saying, “Follow the money”, if you dig a little the skeletons are revealed. Payday Pundit brought this revelation to our attention today about The CRL.

Here’s a snippet from  Culture11.  Read the full article there

The Center for Responsible Lending. Sounds reliable, right? That’s where they get you. They claim to speak up for the people but in reality, CRL is a “predatory lending” organization (what they claim to be against) unethically funded by a wealthy institution that benefits from their policies. According to the Consumer Rights League, CRL “attacks competing loan products” and often takes legal action against low-income borrowers for petty reasons. This is, of course, after they’ve approved loans to the less fortunate at highly profitable rates.