PHOENIX — Joined by a coalition of consumer groups, the Arizona Credit Union System said this week it is stepping up its lobbying activities to defeat a well-financed campaign by payday lenders to adopt enabling legislation on the Nov. 4 ballot.
In an e-mail blitz rousing its members, the Arizona trade group said it is "weighing in Proposition 200–the Payday Loan Reform Act–by urging the 1.6 million credit union members statewide to vote No!" on the proposition, which largely frees the payday firms from future lawmaker review to charge predatory rates.
In a TV and newspaper ad campaign costing $10 million, the payday lobby, Arizona Community Financial Services Association, has championed Prop 200 as a reform issue, a claim mocked by the opposition, including Scott Earl, the president/CEO of the System, who called it "a frightening prospect" that the payday group can "write its own law and pass it as reform and the legislature can't touch it."
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"Payday lenders will charge astonishing interest rates, will have new electronic access to borrowers' checking accounts and will allow people to receive numerous payday loans at once, regardless of existing debt," said Earl.
The law, said the league, would repeal existing statutes that would put payday lenders out of business in 2010, when that 10-year exemption to the state's 36%t interest cap expires.
Earl said the Arizona System in looking out for members and consumers "to protect them from a deceitful and harmful proposition."
In addition to the league, others joining opposition to Prop 200 include: AARP, Arizona Consumers Council United Way and Arizona Attorney General Terry Goddard.
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