CITY OF KANSAS, Mo. – Local businessman Richard Moseley, who ran a fraudulent payday loan program, is required to pay civil money fee of $ 1because he is unable to repay the $ 69 million he made in profits.
“There should be real restitution so that these people are held to pay for the fraud, the years of fraud, that they have perpetrated against people here in this city,” said Seft Hunter, executive director of Communities Creating Opportunity.
While Moseley and his son charged illegal interest rates and took money away from people who never even got a loan, Missouri still has one of the highest legal interest rates for payday loans. The rate is generally around 450 percent, but it is legal up to almost 2,000 percent.
“It’s like legal theft,” said Stephanie White, who has taken out a payday loan in the past.
White says her daughter almost lost her truck because she got a payday loan.
“Some people get stuck and can’t pay them back. But you know what, guess what? Who cares? They don’t. They don’t lower their interest rate,” White said.
There aren’t many other options for downtown people who find themselves in a bind, and that’s what local organizations are working to fix.
“We’ve heard from a lot of people waiting for us to open the doors,” said Gwen Washington, newly appointed CEO of WeDevelopment Federal Credit Union.
WeDevelopment aims to open in late fall at Linwood Mall to be the necessary alternative for people who don’t have credit or checking accounts.
Washington says downtown residents can’t always borrow from family members, so the only options are title loans and payday loans.
You will find several payday loan buildings on one block throughout downtown.
Communities Creating Opportunity joins many other community advocates in criticizing payday lenders for targeting low-income people of color.
Washington and Hunter agree that lenders need to focus more on education.
The Consumer Financial Protection Bureau said this year it would reverse the more stringent regulations the old administration set for payday lenders. Under the regulations, which were due to come into effect in 2019, payday lenders would not be able to lend to people they knew could not repay the loan, nor would they be able to withdraw from the loan. money from their accounts constantly.
Hunter says his organization is calling on local lawmakers to do something.
“Part of what local recourse, and perhaps in some ways national law, is needed is to provide real alternatives. We know people need access to credit,” said Hunter.
Recently, Ohio passed drastic restrictions on payday lenders. Hunter says Missouri must follow.