FOR IMMEDIATE RELEASE
State Rep. Eugene DePasquale
DePasquale votes 'no' to loan shark bill
HARRISBURG, June 7 – State Rep. Eugene DePasquale, D-York, said he voted against legislation this week that would open the floodgates to predatory lenders. The House voted 102-90.
"House Bill 2191 is, in essence, legalized loansharking," DePasquale said. "This bill would allow for an extremely high interest rate that would ultimately trap consumers and push them into worse financial disrepair."
Sponsors of the bill maintain it protects consumers. DePasquale said that proponents of the legislation claim they are trying to rein in abusive Internet payday lending, but this is already illegal in Pennsylvania.
DePasquale said the loans authorized under H.B. 2191 are not short-term quick financial fixes but instead would force consumers into worse debt.
"Similar laws in other states have forced consumers into multiple payday loans a year – 76 percent of payday loans are to repeat borrowers," DePasquale said.
DePasquale said one of the companies pushing for enactment of the legislation – Cash America – is the same company that the state Supreme Court prohibited from making illegal Internet payday loans to Pennsylvanians. In its decision, the court explained that Cash America's business model is to charge astronomical interest rates.
Pennsylvania has long permitted small-dollar loans to carry annual interest rates as high as 24 percent.
House Bill 2191 now goes to the Senate for consideration.