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Predatory Lending
Quick Hit
by Adam Doster
9:01am
Tue Oct 12, 2010

Brady Nets Big Payday Lending Donation

If elected next month, will GOP gubernatorial nominee Bill Brady look out for low-income borrowers or high-cost lenders?

Late last week, the Brady campaign filed several A-1 campaign finance reports, which disclose recent contributions over $500. One of the larger donations, at $25,000, came from an innocuous sounding organization named the Consumer Lending Alliance. This group, based in Florida, is a payday lending industry trade organization that has showered almost $1 million on lawmakers across the country since 2003. Their primary target is Illinois, where legislators have taken in roughly $400,000, according to the National Institute on Money in State Politics. House Minority Leader Tom Cross (R-Oswego) and House Speaker Michael Madigan (D-Chicago) are their two highest recipients nationwide, each bagging over $30,000. In 2008, Brady accepted a $2,000 contribution from the same group. Illinois Strategies LLC does their lobbying under the Capitol Dome.

Although the General Assembly passed a bill almost unanimously this spring that will close a major loophole in the state's 2005 Payday Loan Reform Act, a compromise with several industry trade groups that Brady ultimately supported, there's still a lot of work to be done to limit the excesses of payday lenders and expand access to responsible loan alternatives in Illinois. While Gov. Pat Quinn has fought his entire career to safeguard consumers, this donation should raise some red flags about whose interests Brady will ultimately advocate for.

PI Original
by Adam Doster
1:42pm
Wed Sep 15, 2010
2 comments

Credit Scores And Economic Opportunity

Finances

If you live in an Illinois neighborhood where residents are predominantly people of color, the odds are higher that your credit score is low. A new report examines how the state can bridge that racial gap.

Quick Hit
by Adam Doster
12:14pm
Thu Sep 2, 2010
2 comments

The Speaker And Payday Loan Reform

When we expressed some concern that the Sun-Times' piece earlier this week on the Madigan family and the recently passed payday loan reform bill didn't include enough context about the substance of the legislation, this is the exact problem we had in mind. In his column this morning, the Tribune's John Kass talks to GOP chairman Pat Brady, who says it's "time for a clean break" from the Democratic Party in Illinois because House Speaker Michael Madigan (D-Chicago) "uses his position ... to help out his new son-in-law." To recap: while Madigan should be forced to disclose his familial relationship with lobbyist Jordan Matyas, whose business will benefit from the passage of HB 537, this bill was a very good bill! There's a reason that only two members in the entire General Assembly voted against it. Attorney General Lisa Madigan, her dad, and the consumer advocates who lobbied vigorously for it should be applauded, not criticized. We know it's rare, but this is a great example of state government working in the interest of its citizens.

If the GOP is serious about reducing the Speaker's power in the General Assembly, there are serious ways to approach that problem. Tossing around uninformed political talking points doesn't help.

Quick Hit
by Adam Doster
10:11am
Tue Aug 31, 2010
1 comment

Missing The Forest For The Trees On Payday Loan Reform

Sun-Times' reporters Tim Novak and Dave McKinney did the voting public a service by exposing a loophole in Illinois' "statement of economic interest" disclosure form that allows political candidates to hide familial relationships with registered lobbyists. As the paper's editorial board writes, it's crucial that the state forces lawmakers to admit publicly who in their families could benefit from state laws. Unfortunately, the example they use to illustrate the problem is more complicated than they let on.

The reporters focus on the passage of HB 537, legislation that closed a major loophole in the 2005 Payday Loan Reform Act. Their narrative suggests that the Madigan family -- Attorney General Lisa Madigan, House Speaker Michael Madigan (D-Chicago), and lobbyist Jordan Matyas (who is married to the speaker's daughter Tiffany) -- concocted a diabolical scheme to create new business for Matyas, whose firm will soon track unsecured consumer installment loans for the state. It's true that Matyas' business will receive a boost from the regulatory change. It's also true that the Madigans should be forced to disclose that relationship. But the passage of the legislation was the culmination of a decade-long fight by consumer advocates to close up a loophole that predatory lenders had exploited egregiously at the expense of the state's working poor. Only in passing does the piece recognize that consumer advocates lobbied extremely hard for the bill. (It also passed the General Assembly almost unanimously.) Leaving out that side of the story does a disservice to the readers learning about the important (if watered-down) new law for the first time.

Quick Hit
by Adam Doster
4:34pm
Thu Aug 12, 2010

Stepping Up The Local Pressure On Bank Of America

It was a busy day for Chicago-based National People's Action, the organizers behind the Showdown in America campaign. Earlier this afternoon, the group swung by Chicago's Federal Reserve Bank for a public regulatory hearing about the Community Reinvestment Act, which housing and consumer advocates want to see updated and modernized.

Earlier in the day, NPA also paid a visit to the headquarters of Bank of America. The protesters delivered a letter to Brian Moynihan, the CEO of the humongous financial institution, requesting the bank divest from payday lending institutions and invest more capital into foreclosure prevention programs and small businesses. After all, BoA has its hand in a plurailty of Chicago's home foreclosures. Watch a clip from the event below:

PI Original
by Adam Doster
12:24pm
Wed Jul 28, 2010

Seeking A More Responsible Small-Dollar Loan

Predatory Lending

After devoting considerable energy toward reigning in the excesses of payday lenders, consumer groups in Illinois are now turning their attention to expanding access to responsible small-dollar loans.

Quick Hit
by Josh Kalven
10:18am
Tue May 11, 2010

Crain's Covers The Payday Loan Reform Bill

Amid the chaos in Springfield late last week, we reported that a much-needed bill to close a loophole in the 2005 Payday Loan Reform Act had passed the Illinois Senate and was on its way to the House.  Today, Crain's covered the story, noting that the House will likely voted on the bill before the end of May and featuring this quote from Citizen Action/Illinois co-director Lynda DeLaforgue: "The agreement is historic in Illinois. ... We will for the first time have set rates on these unsecured loans made to the most vulnerable borrowers.”  Learn more about the damaging loophole here.