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Attorney General Ellison condemns federal work to let predatory loan providers make the most of customers

Attorney General Ellison condemns federal work to let predatory loan providers make the most of customers

FDIC guideline will allow payday as well as other predatory lenders to skirt state no bank verification installment loans usury guidelines; AG Ellison joins bipartisan coalition urging withdrawal of guideline they say violates legislation, administrative authority

Minnesota Attorney General Ellison has accompanied a bipartisan coalition of 24 solicitors general in opposing a proposition because of the Federal Deposit Insurance Commission (FDIC) to preempt state usury guidelines that regulate payday as well as other lending that is high-cost therefore which makes it easier for predatory loan providers to make the most of customers. State usury rules prevent predatory lenders from benefiting from customers by recharging high rates of interest on loans. The FDIC’s proposed guideline would allow predatory loan providers to circumvent state usury rules through “rent-a-bank” schemes, by which federally controlled banking institutions work as loan providers in title just, thereby moving along their exemptions from state regulations to non-bank predatory and payday lenders.