Stop Abusive Payday Lending
The Trump Administration is doing everything it can to weaken the Consumer Financial Protection Bureau (CFPB)--the federal agency set up to protect consumers after the financial meltdown. One of the major impacts of this will be less protections for many New Mexico families coping with burdensome debt stemming from predatory high interest loans.
This is a widespread problem in our state. In the year before New Mexico enacted a new state law capping interest rates, New Mexicans took on hundreds of millions of dollars of hard-to-pay-back debt through more than 300,000 high interest loans. The CFPB was all set to institute strong rules to protect American consumers from predatory lending before its new Trump-appointed leadership suddenly reversed course. Without strong CFPB protections at the federal level, we must take action to protect Americans from deceptive payday lending, and particularly online loans.
In recent years, many states, including New Mexico, have put in place tougher laws to stop the most abusive lending practices. However, predatory companies have continued using online lending to evade state law enforcement and prey on unsuspecting Americans. Internet lenders hide behind layers of anonymously registered websites and empty personal bank accounts before consumers have a chance to assert their rights.
This month, I was proud to cosponsor the SAFE Lending Act to crack down on some of the worst abuses of the online payday lending industry. This legislation would ensure that consumers have full control of their bank accounts, require lenders to increase transparency, and ban anonymous online payday lending. These are commonsense steps we must take to empower consumers to better protect themselves against predatory lending practices.
I remain focused on building more economic opportunities for New Mexicans -- and stopping predatory lenders from pulling people into a devastating cycle of debt is an important part of that work. I will continue to fight for pragmatic solutions like this to level the playing field for hard-working New Mexico families.
United States Senator