BILL ANALYSIS �
AB 1158
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Date of Hearing: April 25, 2011
ASSEMBLY COMMITTEE ON BANKING AND FINANCE
Mike Eng, Chair
AB 1158 (Calderon) - As Amended: April 13, 2011
SUBJECT : Deferred Deposit Transactions.
SUMMARY : Changes the California Deferred Deposit Transaction
Law (CDDTL) to allow a licensee to defer the deposit of a
customer's check with a face amount of $500, up from $300.
EXISTING LAW
1)Establishes the CDDTL (also known as the Payday Loan Law,
Financial Code Section 23000 et seq.). The CDDTL:
a) Applies to any person that makes a transaction in which
the payday lender defers depositing a customer's personal
check until a specific date, pursuant to a written
agreement;
b) Does not apply to a state- or federally-chartered bank,
thrift, savings association, or industrial loan company;
c) Requires applicants who wish to become payday lenders to
submit an application for each location, an application fee
of $200, and to submit to various other requirements
including a background check, and prohibits anyone from
engaging in the business of payday lending without a
license from the Department of Corporations (DOC);
d) Allows lenders to defer the deposit of a customer's
personal check for up to 31 days; limits the maximum value
of the check to $300; limits the maximum fee to 15% of the
face amount of the check; and requires payday lenders to
distribute a notice to customers prior to entering into any
payday loan transaction that includes information about the
loan and loan charges and a listing of the borrower's
rights;
e) Requires each payday loan agreement to be in writing in
a type size of 10 point or greater, written in the same
language that is used to advertise and negotiate the loan,
signed by both the borrower and the lender's
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representative, and provided by the lender to the borrower,
as specified;
f) Allows payday lenders to grant borrowers an extension of
time or a payment plan to repay an existing payday loan,
but prohibits the lender from charging any additional fee
in connection with the extension or payment plan;
g) Requires each licensee to maintain a net worth of at
least $25,000 at all times; and,
h) Prohibits payday lenders from entering into a payday
loan with a customer who already has a payday loan
outstanding, and from doing any of the following:
i) Accepting or using the same check for a subsequent
transaction;
ii) Permitting a customer to pay off all or a
portion of one payday loan with the proceeds of another;
iii) Entering into a deferred deposit transaction
(DDT) with a person lacking the capacity to contract;
iv) Accepting any collateral or making any payday
loan contingent on the purchase of insurance or any other
goods or services;
v) Altering the date or any other information on a
check, accepting more than one check for a single payday
loan, or taking any check on which blanks are left to be
filled in after execution;
vi) Engaging in any unfair, unlawful, or deceptive
conduct or making any statement that is likely to mislead
in connection with the business of DDTs; or,
vii) Offering, arranging, acting as an agent for,
or assisting a deferred deposit originator in any way in
the making of a DDT unless the deferred deposit
originator complies with all applicable federal and state
laws and regulations.
2)Provides that licensees who violates the payday loan law are
subject to suspension or revocation of their licenses, and
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that violations of the payday loan law are subject to civil
penalties of $2,500 per violation;
3)Specifies that anyone that violates any provision of Section
670 of the John Warner National Defense Authorization Act for
Fiscal Year 2007 (Public Law 109-364) or any provision of
Section 232 of Title 32 of the Code of Federal Regulations, as
published on August 31, 2007, in Volume 72 of the Federal
Register, violates the California payday loan law. �Financial
Code, Section 22345]
4)Provides that a person that refuses to offer a payday to a
member of the military is not in violation of the Military and
Veterans Code provision relating to discrimination against
members of the military. �Financial Code, Section 23038].
FISCAL EFFECT : Unknown
COMMENTS :
Need for the bill:
According to information provided by the author:
California is currently tied for the lowest maximum loan
limit in the country even with a higher cost of living than
anywhere else. In 2007, the Department of Corporations
delivered a report titled "The California Deferred Deposit
Transactions Law' to the Legislature. One of the key
recommendations of the report was to increase the maximum
loan amount to $500 or $750 . They based this on the fact
that California was low compared to other states and that
it appeared too low to meet the need for an emergency for
consumers. Taking account of inflation since 1995, an
inflation adjusted maximum loan limit at the end of 2010,
comparable to $300 in 1995 would be $442.05. This
calculation was performed using the Annual California
Consumer Price Index for All Urban Consumers.
Payday Lending Background :
A payday loan, known more formally in California as a DDT, is a
short-term loan in which a borrower writes a post-dated,
personal check to a lender for a specified amount, which is
capped by law. The date on the check is the date on which the
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parties agree that the borrower will repay the loan. The lender
advances the borrower the amount on the check, less the fee,
which is also capped by law. The lender does not cash the check
at the time the loan is made. Both parties are aware that the
borrower lacks sufficient funds to cover the check when the
check is written. The assumption underlying the loan is that
the borrower will repay the loan by the agreed-upon date, either
by depositing sufficient funds in his or her checking account to
cover the check, or by paying the lender in cash on the loan's
due date, and having the lender return the original check to the
borrower, without cashing it.
California enacted its earliest version of a payday lending law
in 1996, and gave jurisdiction over payday lenders to the
Department of Justice (DOJ) SB 1959, (Calderon, Chapter 682,
Statutes of 1996). SB 898 (Perata, Chapter 777, Statutes of
2002), enacted the CDDTL; and shifted the responsibility for
administering payday lending from DOJ to the DOC.
Under the CDDTL, any lender who makes a payday loan must be
licensed. Each licensee may defer the deposit of a customer's
personal check for up to 31 days. The face amount of the check
presented by a borrower may not exceed $300, and the fee charged
by the licensee may not exceed 15% of the face amount of the
check ($45 on a $300 check). Licensees may charge one
non-sufficient funds fee, capped at $15, for checks that are
returned by a customer's bank. Licensees may not directly, or
indirectly charge any additional fees in conjunction with a
payday loan. Licensees may not enter into a payday loan with a
customer who already has a payday loan outstanding and may not
allow a customer to use one loan to pay off another. Licensees
are also forbidden from accepting any collateral for a payday
loan or making any payday loan contingent on the purchase of any
goods of services. Each payday loan must be made pursuant to a
written agreement. Licensees must post their fees and charges
prominently at their business locations.
On March 10, 2008, the DOC released two reports to fulfill its
requirements under Section 23057 of the Financial Code. The two
reports are titled, "California Deferred Deposit Transaction
Law, California Department of Corporations, December 2007" (DOC
report) and "2007 Department of Corporations Payday Loan Study,
December 2007, submitted to the California Department of
Corporations by Applied Management Planning Group, in
conjunction with Analytic Focus" (AMPG report).
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The key findings from the aforementioned reports:
California is home to 447 licensed payday lenders, which
operate 2,403 licensed payday lending stores. A total of 338
licensees indicated to AMPG that they were actively making
loans during the study period of April 15, 2006 through
September 11, 2007. (Note: new data from the 2009 Annual
Report, Operation of Deferred Deposit Originators Under the
California Deferred Deposit Transaction Law, reveals the
existence of 2,187 locations)
Over two-thirds of all payday loans are made by only twelve
licensees (AMPG). The largest 30 licensees made 82% of payday
loans by dollar volume during 2006 (DOC).
Over 61% of all licensees operate only one payday loan
location (AMPG).
Forty-nine of the state's 58 counties have at least one payday
loan location. With 166 payday loan locations, the City of
Los Angeles has the highest concentration of payday loan
locations of any city in the state. The City of Sacramento is
second, with 81 locations (AMPG).
Sixteen licensees (3.5%) reported making over 115,000 payday
loans over the Internet during 2006 (DOC).
The average length of a payday loan is 16 days (DOC).
Most payday lenders advertise using large, conspicuous signage
on the outsides of their licensed locations (DOC). Many (70%)
also advertise in local telephone directories; a smaller
percentage advertise in local newspapers (29%) and Internet
directories (27%; AMPG).
Before agreeing to lend to a borrower, most licensees require
the borrower to provide identification, proof of some form of
income, a home address, employer's address, and checking
account information. Licensees rarely conduct a credit check
or verify whether the borrower has the ability to repay the
loan, when their other debts and expenses are considered.
Most payday loans can be obtained in under 15 minutes (DOC).
Most lenders accept any kind of verifiable income as proof of
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income, other than unemployment checks or reports of
self-employment (AMPG). Payroll checks, government assistance
checks, retirement checks, disability checks, annuity and/or
structured settlement checks are the most common forms of
income verification accepted. Although all payday loan
customers are required to have and show proof of an active
checking account, only 5% of licensees require that borrowers
have the qualifying income deposited directly into their
checking accounts (AMPG).
Cash is the most common method of distributing loan proceeds
to borrowers, although the option of electronically depositing
the funds into customers' bank accounts is increasing in
popularity among licensees (DOC).
Eighty four percent of licensees' business is attributable to
repeat customers (only sixteen percent comes from customers
who take out only one loan). Nineteen percent of licensees'
business is attributable to customers who took out more than
15 loans during the 18-month period studied by AMPG.
Forty one percent of licensees offer some type of bonus
(either cash or gifts) to customers who refer new business to
the licensees. Cash is much more common than other types of
gifts. Of those who offer cash bonuses, nearly one half offer
$10 or less, and just under one third offer between $20 and
$25 (AMPG).
Very few licensees accept personal checks for repayment (this
despite the fact that a post-dated check is required in order
to obtain a payday loan). Customers commonly pay off their
loans in cash. Nearly all lenders who do accept personal
checks for repayment charge non-sufficient funds (NSF) fees
for returned checks (DOC and AMPG).
Fifty seven percent of licensees require customers to borrow
at least $50. The majority of loans (63%) are between $200
and $255. Twenty lenders responded that the minimum amount
they would lend was $255 (AMPG).
Although lenders may charge up to $45 in loan fees to lend the
maximum amount of $300, 14% of lenders charge less than $45 on
$300 loans. The smallest amount charged on a $300 loan was
$25, corresponding to a maximum loan amount of $275 (AMPG).
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To prevent the loss of revenue due to defaulted loans, most
lenders (87%) offer arrangements in which borrowers are
allowed to pay back loans at a reduced rate or based on an
agreed-upon schedule. Lenders reported that about 20% of
loans issued during the eighteen-month study period required
some type of workout arrangement (AMPG). However, less than
1% of all payday loan customers entered into formal, written
payment plan arrangements during 2006 (DOC).
Customers who take out multiple loans in a year tend to do so
in a consecutive fashion (with less than five days elapsing
between paying the first one off and obtaining a second one).
Nearly 450,000 borrowers had back-to-back time-frames of 6
loans or more. (DOC)
More than 57,147 borrowers had more than 19 consecutive
transactions during 2006 accounting for only 4% of borrowers,
but for 50% of the loans.
Of those borrowers who obtained more than one payday loan in
the last eighteen months, 28% used multiple locations of the
same payday lender; 72% used multiple lenders (AMPG).
Borrowers were asked whether the amount borrowed was the
amount needed or the most the lender would loan. When asked
in this way, 63% of borrowers said they borrowed the amount
needed; 32% said they would have borrowed more, but the lender
wouldn't loan it; and only 3% said that the lender offered
more than the borrower needed.
When borrowers were asked where they obtained the rest of the
money they needed if they could not obtain all they needed
from the payday lender, 8% said they borrowed the money from
family or friends, 8% said they did not get the rest of the
money they needed, 5% waited until their next payday, 3% went
to another payday lender, and less than 1% borrowed money from
a bank.
Thirty-six percent of borrowers indicated they had used more
than one payday lender. When asked why, 73% said they needed
more money than one location would loan them at one time, 12%
said they needed more money before the loan with the first
company could be paid off, and 11% said they used one loan to
pay off another.
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Report policy recommendations.
1)Clarify and confirm that licensees cannot refer delinquent
payday loans to a local prosecutor for collection of returned
checks
2)Enhance the regulation of electronic transactions.
3)Improve consumer disclosures by requiring that the notice
provided to borrowers prior to entering into a payday loan
agreement be a separate, distinct document from the written
agreement; require the licensee to have the borrower initial a
copy of the notice to acknowledge receipt; and require the
licensee to retain a copy of the notice with the borrower's
initials acknowledging receipt in the file.
4)Require license applicants and existing licensees to notify
DOC of other business that would be or is being conducted at
the licensed location.
5)Expand consumer protections for payday lending conducted over
the Internet by requiring that notices and disclosures are
provided to Internet borrowers, and that borrowers can
download the agreement, notices, and disclosures.
Alternately, if the borrower cannot download those documents,
require the licensee to mail copies to the borrower within 24
hours.
6)Require that payment plans entered into between licensees and
borrowers specify the payment dates and amounts of each
payment, be in writing, and be signed by the borrower.
7)Require a written agreement signed by the borrower in order to
extend the due date of a loan. Provide the licensee with an
option to notify the borrower by mail of the approval to
extend the due date of the loan, if the borrower elects not to
sign the extension agreement. Like the recommendation above,
this recommendation would help avoid misunderstandings between
lenders and borrowers over repayment plan terms.
8)Require licensees to prominently disclose that borrowers have
the right to request a written extension agreement and payment
plan.
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9)Require that specific language be used in payday loan
advertising to disclose one's licensure by DOC, and require
that all advertising disclosures be in the same language as
the advertising itself.
10)Require (rather than authorize) the use of a specific chart
to compare payday loan fees and related cost information.
Existing law requires licensees to post a schedule of all
charges and fees, as specified, and provides an example of one
way in which the information may be presented.
11)Require license applicants to list each person in charge of a
payday lending location, and require that person to submit
fingerprint information and a historical profile through a
Statement of Identify and Questionnaire (SIQ). Require the
licensee to notify DOC within ten days of a change in the
person responsible for the location, and to submit new
fingerprint information and an SIQ for that person. Require
each licensee to notify DOC at least 60 days prior to a change
of its officers, directors, or any other persons named in the
application.
12)Confirm DOC's jurisdictional nexus over payday lending
activities by stating that a payday lender is subject to the
CDDTL when it conducts deferred deposit transaction business
"in this state."
13)Expand the grounds for barring, suspending, or censuring
persons managing or controlling payday lenders, and for
denying, suspending, or revoking licenses
14)Allow DOC to issue administrative orders to prevent unsafe
and injurious practices, and make these orders effective
within 30 days, if no hearing is requested by the person(s)
accused. Allow DOC to suspend or revoke a license for failing
to maintain a surety bond, as required by law, through more
expedient administrative orders.
15)Increase the civil penalty for violating the payday loan law
from $2,500 to $10,000 per violation. Allow administrative
penalties of up to $2,500 per violation to be levied and
collected through specified administrative hearing procedures.
16)Require the preparation and retention of accurate records and
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reports by licensees.
17)Authorize the Commissioner to subpoena all books and records
of payday lenders.
18)Allow DOC to seek a court order to enforce any administrative
decision awarding restitution, administrative penalties other
than citations, and cost recovery, without having to file a
civil suit and motion for summary judgment.
19)Provide that a citation is deemed final if the cited licensee
fails to request a hearing within 30 days of receiving the
citation. Allow DOC to issue a citation to assess an
administrative penalty, not to exceed $2,500 per violation
(rather than $2,500 per citation).
20)Streamline DOC's ability to void loans and order fees
forfeited. Clarify that DOC has the authority to order the
voiding of loans and the forfeiture of fees by administrative
order, rather than by pursuing a civil suit.
21)Change the payday loan origination fee from a percentage of
the face value of the check to a flat fee.
22)Increase the maximum amount of a payday loan from $300 to
another amount, such as $500 or $750.
23)Adjust fees based on the loan amount, with a sliding scale
that reduces the fee as the amount borrowed goes up.
24)Prohibit a licensee from entering into a deferred deposit
transaction with a customer during the period-of-time that the
customer has an outstanding deferred deposit transaction with
another licensee.
25)Restrict a customer from having a payday loan outstanding
with any payday lender for more than three months during a
twelve-month period.
26)Require licensees to offer a payment plan with a minimum of
six equal, monthly installment payments to all borrowers who
have had continuous (consecutive) loans for three months, and
prohibit licensees from charging customers any additional fees
or interest in connection with the payment plan.
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27)Require all licensees to use a uniform database to record all
transactions in real time.
Some updated statistics .
The 2009 Annual Report, Operation of Deferred Deposit
Originators Under the California Deferred Deposit Transaction
Law, offers some updated statistics on the payday lending market
for 2009.
1)Total dollar amount of transactions: $3,099,358,316
2)Total number of transactions: 11,784,798
3)Average annual percentage rate: 414%
4)Total number of returned checks for DDT transactions: 677,616
5)Total dollar amount of returned checks: $178,369,234
6)Total number of returned checks recovered (including partial
recoveries): 432,284
7)Total dollar amount of returned checks recovered: $98,998,954
8)Total number of checks charged-off: 280,233
9)Total dollar amount charged-off: $72,023,747
10)Number of licenses revoked: 25
Arguments in support:
The Community Financial Services Association and the California
Financial Service Providers' Association write in support:
Quite simply, the current payday advance limit is outdated.
It was put into effect nearly 16 years ago when short-term
loans were established in California. Officials from the
California Department of Corporations (which has
jurisdiction over deferred deposit lenders) stated in their
annual report that the current maximum payday advance of
$300 is too low to meet the common emergency needs of many
customers and should be raised between $500 and $750. As
you know, California is one of the most costly states in
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which to live, and yet the state has one of the lowest
advance limits in the nation. The $300 limit does not
always meet the needs of families who have run out of
financial resources, especially in these tough economic
times.
Arguments in opposition:
A coalition of community and consumer organizations write in
opposition:
In November, after a landslide vote, Montana joined 15
other states and the District of Columbia in placing
double-digit limits on the interest that payday lenders can
charge. With shrinking profits in other states, payday
lenders are turning to California in an attempt to preserve
their profit margins on the backs of struggling
Californians, by seeking to increase the allowable loan
amount to $500. Earlier this month, the San Diego City
Council unanimously voted to adopt a Council resolution
against the usurious interest rates and predatory business
model of the payday lenders calling on the California State
Legislature to enact a 36% APR interest rate cap on payday
loans.
Current California law allows a borrower to write a check
for a maximum of $300 to borrow $255. The high cost of
payday loans (459% APR), together with the short two-week
repayment term, virtually ensures that cash-strapped
borrowers will not be able to meet their basic expenses and
pay off their loan at their next payday. It follows, then,
that increasing the amount of debt payday borrowers owe
will only increase the likelihood that payday borrowers
will not be able to pay off the loan at their next payday,
and will be more likely to land in the debt trap.
Payday loan alternatives .
What payday loan alternatives exist for consumers? Over the
last 30 years consumer lending has undergone a significant shift
in that most depository financial institutions moved away from
offering small dollar personal loans. It appears that in some
cases the small consumer loan business is beginning to find its
way back into the branches of banks and credit unions. However,
it would be fair to say that a major gap still exists in the
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small dollar consumer loans market place. That niche is
currently dominated by payday lenders. Some of these products,
such as payday advances tied to checking or savings accounts
offered by banks and credit unions would appear to be a step in
the right direction that offer consumers a viable alternative.
Several credit unions in California have started offering payday
loan type products. For example, Patelco Credit Union in San
Francisco offers a revolving credit line of up to $750 with a
$10 fee per withdrawal which equals a 17.8% APR. This type of
loan requires at a minimum a credit check. Golden 1 Credit
Union, California's largest credit union, also has a payday loan
type product. Nationwide, several federal credit unions offer
these products varying in loan amounts from $50 to $500 with a
range of interest rates and charges. However, it is important
to note that due to differences in state and federal law, state
chartered credit unions in California may not offer services to
non-members. The instant nature of the transaction with a
payday lender is not similar to that of a credit union where the
borrower must be a member and go through a loan underwriting
process.
Additionally, several banks offer short-term type loan products
for their customers under a cash advance program. According to
the DOC report referenced earlier,
An example of a cash advance program is the Direct Deposit
Advance Service offered by Wells Fargo Bank that allows a
customer to obtain an advance up to $500 or a lesser limit
established for the customer, in $20 increments. The charge
is $2 dollars for every $20 advanced. The funds advanced
are deposited into the customer's checking account. In
order to qualify for the Direct Deposit Advance program,
the customer is required to have a recurring electronic
direct deposit of $100 or more from an employer or outside
source. The advance must be repaid within 35 calendar days.
The advance plus the fee is automatically withdrawn from
the borrower's account on the date funds are electronically
deposited into the borrower's account. For customers that
obtain advances for 12 consecutive statement periods, the
credit limit will be reduced by $100 in each future
statement period, until the credit limit reaches zero or an
advance is not obtained for one statement period.
US Bank also offers a Checking Account Advance product that
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allows a customer in California to obtain an advance up to
$300 or half the direct deposits made into the account
within the most recent statement cycle, in $20 increments.
To be eligible, the checking account must have received a
direct deposit of $100 or more from an employer or outside
agency for at least two consecutive statement cycles, one
of which must have been received within the last 35
calendar days. The finance charge is one dollar for every
ten dollars advanced and must be repaid within 35 calendar
days. Payments are automatically deducted from the checking
account at the time a direct deposit of $100 or more is
made into the account. A customer that obtains nine
consecutive advances will be ineligible for an advance for
the next three months.
In February 2008, the Federal Deposit Insurance Corporation
(FDIC) issued guidance for financial institutions to establish
pilot programs for small dollar loan programs. The FDIC
guidelines provided for the following parameters of the program:
1)Loan amounts of up to $1,000;
2)Amortization periods longer than a single pay cycle and up to
36 months for closed-end credit, or minimum payments that
reduce principal (i.e., do not result in negative
amortization) for open-end credit;
3) APRs below 36 percent;
4)No prepayment penalties;
5)Origination and/or maintenance fees limited to the amount
necessary to cover actual costs; and,
6)An automatic savings component.
This pilot program began with 31 banks. According to the FDIC,
the participating banks thus far view the program as a long-term
strategy to attract new customers and new relationships.
Additionally, only one California bank participated in the
pilot.
On the flip-side, other alternatives exist that may be far worse
than payday loans. Unregulated internet lending exists that
using interest rates and charges far exceeding those regulated
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under California law.
Issues for Discussion .
This bill raises the face value of the check accepted as
collateral for the payday loan to $500, meaning that based on
the fee parameters in current law a consumer would write the
lender a check for $500 and receive a loan of $425. The APR on
this two-week transaction would be 460%.
The battle over the appropriateness of the payday loan product
has been the subject of numerous bills appearing before this
committee in recent years. This issue arises due to a lack of
small dollar products in the market place. Thus far, the
availability of loan products between the payday limit of $255
and $2500 is virtually non-existent outside of a few pilot
projects. The most recent attempt to expand the small dollar
loan market occurred via SB 1146 (Florez), which became law
January 1, 2011. This bill established a pilot project under
the California Finance Lender's Law to offer consumer loans of
less than $2500. At this point, it is unclear how much of
impact this product will make in this market. It may take
several years to truly understand its impact.
Consumer organizations highlight that payday loans are a "debt
trap" meaning that the borrower gets stuck in a cycle of debt
leading to further deficits in personal income. For example, if
the borrower doesn't have $255 today for expenses then will the
borrower have the extra money after paying their regular bills,
to pay back the loan in two weeks when the loan comes due? In
many cases, the borrower simply takes out additional loans,
back-to-back, in an attempt to make up the lack of personal
funds.
The DOC report referenced at length in this analysis made
several recommendations regarding potential changes to the DDTL.
In the discussion regarding increasing the loan limit, the DOC
report also offers for consideration a sliding scale of charges
based on the amount borrowed. This bill only makes one of
those changes. Should this bill be amended to specify further
changes?
Amendments?
Should this bill move forward the committee and author may want
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to consider additional amendments such as:
1)A sliding scale of fees based on the amount borrowed.
2)Increase civil penalties for violating loan DDTL from $2,500
to $10,000 per violation. Allow administrative penalties of
$2,500.
3)Enhance DOC's ability to void loans and recoup fees for
borrowers via administrative orders rather than through civil
suit.
4)Require repayment plans to be in writing specifying payment
dates and amounts of each payment and require licensees to
advertise the availability repayment plans.
5)Allow DOC to request and audit all licensee records.
6)Increase licensing fee for enforcement costs.
7)Allow DOC to suspend activity at a licensed location if
commissioner finds that the location is making DDTs without
regard customer's ability to repay the loan.
Prior State Legislation
AB 2511 (Skinner). Would have prohibited the offering of a
payday loan to someone receiving unemployment benefits, unless
the APR for the loan was 36%. Held in Assembly Banking
Committee.
AB 377 (Mendoza). Provided for various changes and reforms to
the DDTL. Additionally, would have raised the face value of the
check amount to $500. Died in Senate Judiciary.
AB 2845 (Jones, Bass & Feuer). At one point, would have capped
the APR on payday loans at 36%. Was amended in Assembly Banking
& Finance committee to state the intent of the Legislature to
enact changes recommended in the DOC reports. Held in Assembly
Rules Committee.
SB 1959 (Calderon, Chapter 682, Statutes of 1996): Enacted the
earliest version of a payday lending law in California. Gave
regulatory authority to the California Department of Justice.
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SB 898 (Perata, Chapter 777, Statutes of 2002). Enacted the
Deferred Deposit Transaction Law and shifted the responsibility
for administering the law to DOC;
AB 7 (Lieu, Chapter 358, Statutes of 2007): Gave DOC the
authority to enforce specified federal protections granted to
members of the military and their dependents under the Payday
Lending Law.
SB 1551 (Correa): Would enact various changes intended to
improve regulatory oversight of the payday lending based on
recommendations found in the two reports referred to in this
analysis.
REGISTERED SUPPORT / OPPOSITION :
Support
California Hispanic Chambers of Commerce
Academia Avance
League of United Latin American Citizens (LULAC)
Initiation Change in Our Neighborhoods (ICON)
The Community Financial Services Association (CFSA)
Opposition
AARP, California
African American Network of Kern County
Alliance of Californians for Community Empowerment (ACCE)
Asian Law Alliance
Black Economic Council
California Association for Micro Enterprise Opportunity
California Labor Federation AFL/CIO
California Reinvestment Coalition
California Teamsters Public Affairs Council
Catholic Charities of California United
Center for Responsible Lending
Coalition for Quality Credit Counseling
Consumers Union
Council of Mexican Federations
Dolores Huerta Foundation
East Los Angeles Community Corp. (ELACC)
Greater Sacramento Urban League
AB 1158
Page 18
Greenlining Institute Insight
Honorable Jose Cisneros, Treasurer, City & County of San
Francisco
JERICHO
National American Indian Veterans Inc.
National Asian American Coalition
National Council of La Raza, CA
New America Foundation
Opportunity Fund Northern California
Public Interest Law Firm
Sacramento Housing Alliance
Silicon Valley Community Foundation
Teamsters Public Affairs Council
The Americas Group
Ubuntu Green
United Way of California
Western Center on Law & Poverty
Analysis Prepared by : Mark Farouk / B. & F. / (916) 319-3081