PayDay Loan industry shows how not to collect signatures…
No matter how you feel about the PayDay Loan ballot issue, this type of behavior is not only wrong but just creates even more bad public relations attention on them. It’s similar to problems with Learn and Earn and everyone should read the actual petition for any thing they are asked to sign. If the accusations can be proven that this press release states, they should be prosecuted:
COLUMBUS – Petition circulators for the national payday lending lobby illegally paid homeless men to sign referendum petitions for its campaign to undermine Ohio’s new payday reform law and have routinely misled voters by insisting that the referendum would lower interest rates – not raise them.
Voters from around Ohio took part in a Tuesday news conference to expose the illegal payments and the false information being used by the petition circulators.
Two residents of a Butler County homeless shelter, CHOSEN, joined the news conference by phone and said petition circulators showed up at the shelter and paid more than a dozen residents $1 each to sign – a practice banned under Ohio law.
Charlie Schirmer and Connie Smithers said word spread quickly through the shelter that cash was being offered to those who signed.
“What is at stake here is nothing less than the integrity of the petition-gathering process,” said Tom Allio, who hosted the press conference and chairs the Ohio Coalition for Responsible Lending. “Referendum leaders have a moral and legal obligation to ensure that those who work for them are properly trained, fully transparent and truthful in all their representations to signers. In fact, they should make such a pledge today.”
The referendum is being financed by the national payday lobby, which hopes to continue charging 391 percent APR on two-week loans. A success at the ballot would undermine the state’s new payday lending reform law, which caps interest at 28 percent annually. The new law is scheduled to take effect September 1.
Also at the news conference:
··· Toledo City Councilman Frank Szollosi said he was asked to sign a petition while attending a summer festival and told the ballot issue is intended to bring about a rate cut, not a rate increase. In conversations with other festival-goers, Szollosi encountered several who regretted signing the petition once they learned its true intent.
··· In Columbus, a circulator who would not give his name masqueraded as a friend of the consumer.
“These guys are legal loan sharks and we want to regulate ‘em,” he said, according to a tape recording of the conversation. When asked if lenders could still charge 391 percent APR if the referendum succeeded, he fired back: ”No ma’am. No ma’am. Five percent. Do you want to see that it writing? Five percent it’ll be the max….”
The recording was one of two supplied by Sandy Theis, spokeswoman for the campaign to preserve Ohio’s payday reforms.
In the second conversation, a circulator who identified himself as James, described the referendum this way: “They’re trying to bring the rates down … they’re trying to get one flat rate so when you go out and get your money you won’t have to pay all the interest and stuff.”
Copies and transcripts of the conversations can be found at www.end391.org by clicking on Dirty Secrets.
··· In Youngstown, State Rep. Robert Hagan taped a similar conversation on his cell phone. A petition circulator told Hagan the referendum’s goal is to provide loans with five percent interest. Hagan said he encountered two circulators, both in Youngstown, and both told him the referendum would lower rates.
··· Hagan’s son, Jimmie, also spoke at the news conference, telling reporters he encountered three circulators, each of whom said rates would go down. The younger Hagan is a student at Oberlin College.
··· At the Columbus Metropolitan Library, a petition circulator told Cathy Johnston that interest rates would drop if the referendum succeeds. Johnston, advocacy director for the Coalition on Homelessness and Housing in Ohio, said the circulator approached her even though she wore a button reading “391%” with a slash through it.
Akron voter Michelle Mezaris could not attend the news conference but provided an affidavit stating that a circulator told her she would not be permitted to cast a vote on the issue – one way or another – unless her name appeared on one of the petitions. Mezaris’ right to vote on the issue is not tied in any way to her signature on a petition.
“It is inconsistent for the lenders to claim that they are ‘pro consumer choice’ yet fail to provide signers with accurate information that is necessary to make informed decisions,” Allio said. “We want all voters to know if they sign one of these petitions, they are supporting predatory, usurious practices.”
Those who signed a petition under false pretenses have the legal right to ask that their names be removed, Allio said. He urged voters who wanted their names removed to contact Ohioans for Financial Freedom, the lender-financed group pushing the referendum.
This type of deceptive practice and using the homeless happens all to often, some companies have done it so many times that they’ve made it a list of fraud merchants.
How do you avoid it? Never ever ever believe what a signature petition gatherer tells you. Read it for yourself and if they don’t have the ballot language? Don’t sign it, they are supposed to.
August 12th, 2008 at 3:15 pmWhy do groups always seem to get caught doing this? It seems to me you can always find enough people to sign something to get on the ballot. Passing it is a different thing, but why risk generating bad PR like this?
August 12th, 2008 at 3:30 pmI think some of it is the quality of the people they are hiring to collect the signatures.
August 12th, 2008 at 3:31 pm*SARCASM ALERT*
$1 per signature? Kind of cheap in this economy, no?
August 12th, 2008 at 3:39 pmTrue, the homeless should hold out for more – then again those getting the signatures depending on the company who hires them don’t make much. That was one thing about Learn and Earn, I disagreed with some of the tactics the signature gatherers used, but they did pay them over ten dollars an hour.
August 12th, 2008 at 3:41 pm[...] a post on payday loan interests caught using underhanded tactics to get signatures. As LisaRenee says, always read these things before you sign. Or at least hold out for more than a [...]
August 12th, 2008 at 4:09 pmUnfortunately, such practices sound the death of a valid effort to reduce government overregulation of our liberties and freedom.
TAHL
August 12th, 2008 at 4:17 pmThe lenders are liars … and now we have the proof.
THANK YOU for passing it on. I might go buy a tape recorder and catch these guys myself!
August 12th, 2008 at 7:15 pmTo be fair, it’s those hired by the lenders who are liars, absent any proof that the lenders specifically stated to those collecting signatures to lie, this has happened before and has been either individuals or a few employees of the firm hired to collect signatures who were at fault.
Learn and Earn as an example, enhanced their training to make sure those who were collecting signatures were being honest after complaints/concerns were raised. We’ll have to see what if anything is done by the Lenders to address these claims.
August 12th, 2008 at 7:25 pmTo be even more fair, not training your employees property and not providing them with the appropriate information with which to educate voters means that you are complicit. It is in their best interest not to inform voters about the issue because they know full well no one will support 391% interest!
August 12th, 2008 at 8:57 pmhttp://www.end391.org/
August 12th, 2008 at 9:04 pmAren’t payday lenders just great? They are so helpful. They move into low-income and minority neighborhoods to offer their products and surround military bases with their storefronts, just to make sure that everyone has a great choice available to them: 391% interest! And now they are just passing out free money to homeless people!!! It’s nice to see an industry forgetting about their profits for a minute and really taking the time to take care of those in the community!
August 12th, 2008 at 9:06 pmhey Frank?
http://www.stopbeingaunionpuppetandgetpastyourpersonalagendasandfixtoledo.com
thank you
August 12th, 2008 at 9:34 pmI opposed Learn and Earn and I took issue with the signature issues, I feel the exact same way about those who lied to collect these signatures but it is wrong assume without proof that this was purposely done. When Learn and Earn happened? I talked to those that actually worked collecting petitions. I verified the training process was changed before the signatures were turned in.
The problem is the process, when you hire people to collect signatures you have more problems than volunteers who are motivated by a cause as opposed to profit. It’s not a problem just related to this petition drive and if we continue to ignore the basic issues nothing will ever be resolved.
August 12th, 2008 at 9:39 pmCome on! It’s obvious that it isn’t in the payday lenders best interest for voters to know what their referendum will really accomplish. Their referendum will gut House Bill 545 and render it totally ineffective. The major tenant of the legislation is the 28% rate cap. Without it, payday lenders will continue to gouge Ohioans with 391% interest. I don’t doubt for one second that they purposefully leave out certain details when training their employees because they don’t want them to repeat them! Based on what I read in the Dispatch and the Plain Dealer, it’s pretty clear that there is a pattern of petition circulators suggesting that interest rates will be lowered by the referendum. I think we all know that’s a blatant lie!
August 12th, 2008 at 10:00 pmWhat a bunch of crooks! First they tried to buy the legislature off with campaign contributions & hiring family members of leadership. Then they attempt to trick voters by submitting unfair and untruthful ballot language and now they are lying to voters to get their referendum on the ballot. What’s next? Actually paying voters for their votes? I wouldn’t put it past them!
August 12th, 2008 at 10:05 pmI’ve never said that it was not a blatant lie, and as has been stated repeatedly, why it is important voters take personal responsibility for not signing ANY petition that they have not actually read. Until the day we do away with the system of paying people to get signatures.
This has happened before and it will happen again and since it appears no one in Ohio’s government wants to address the problems related to paying people to gather signatures? It’s incumbent upon us to be responsible when they aren’t.
August 12th, 2008 at 10:06 pmNow come on! What is wrong with paying folks to sign something or even vote a certain way?
Our Congressmen (and other elected orifices officials) get paid by special interest groups all the time!
August 13th, 2008 at 7:35 amImagine that, someone paying for signatures.
It isn’t like that goes on every day on Capital Hill with lobbyists, and all.
August 13th, 2008 at 8:42 amGreg:
Since when is a requirement of business to “forget about their profits for a minute and really taking the time to TAKE CARE OF THOSE in the community!?” Your quote clearly indicates your belief that it is the job and purpose of government to TAKE CARE of us, because free people obviously can’t do it for themselves.
How about the goal of – take care of yourself – IE PERSONAL RESPONSIBILITY. Charity, altruism and community support are nice goals for a business to have – and probably help their bottom line; but in no way is it a requirement of business, nor the government’s place to force it upon them.
My pay-day loan vendor of choice is neither in a minority neighborhood nor outside a military base.
TAHL
August 13th, 2008 at 9:28 amYour article does not mention the fact that congressman Frank Szollosi, up until 1 week ago, was working to get an issue on the ballot with the exact same organization that is currently collecting signatures for the pay day lenders. The exact same company and the exact same petitioners were circulating petitions (for him and his organization for which he is a consultant) to get the Ohio Healthy Families Act on the ballot in Nov. While the healthy families act issue polls off of the charts the pay day lenders issue does not. I just find it very convenient that in a matter of a week of ending his petition gathering campaign, all of a sudden, this company’s petition gathering practices are no longer acceptable to him…or maybe they are just no longer useful.
August 13th, 2008 at 9:29 amSo, 391% interest is freedom? I don’t think so. Usury is not freedom. And A-Hole, you made my point exactly. It isn’t a requirement and they certainly don’t do those things, but you wouldn’t know it by their press releases and talking points! Can’t we at least get some acknowledgment that payday lending is a bad thing? The argument that we should all have the freedom to make bad decisions is a weak one.
August 13th, 2008 at 10:15 amGreg, payday lending is a bad thing, but it’s not as bad as being evicted or having your utilities shut off. Both scenarios I know people who have used these services would have experienced. It’d be great if it was cheaper but what would be even better yet would be for us to have an economy where a majority of people didn’t even need them.
Brian, this wasn’t an article, it was a media release and I did know know that Ohio Healthy Families act paid a firm, I thought it was volunteers collecting those. If you know the name of the firm that was used? I’d love to find out more about that.
August 13th, 2008 at 10:26 amMost of the “demand” that you are referring to is completely artificial. Once a person makes that fateful mistake of walking into one of those places, they are trapped and need to keep going from one to another to pay off previous loans. By the time they are done, want to know what they’ve accomplished? They’ve spend hundreds, possibly thousands to borrow $300 to $500 of their own darn money! It’s a racket, plain and simple!
August 13th, 2008 at 10:49 amIt’s a person’s personal choice if they want to use this type of service. The government needs to keep out of our lives. Look at the banking industry. They charge fees on top of fees. Lawmakers don’t go after this industry. No wonder businesses stay out of Ohio. It is not a business friendly state. There would be no need for this petition if the government would do the work we pay them to do and stop trying to be a nanny state.
August 13th, 2008 at 11:16 amGreg, not everyone who uses a payday loan ends up in the repeat cycle. Some do but even using this statistic by the Ohio Coalition for Responsible Lending, that I’m guessing you are affiliated with that is against PayDay loans as reported in the Plain Dealer Thursday, September 20, 2007:
…the report found that Ohio borrowers take 12.6 loans a year with an average loan of $328 and an average fee of $49.33. There are 52 weeks in a year, these loans are typically a two week period which would mean 26 weeks would indicate someone who is caught in a cycle, this means half of that.
The PayDay Loan industry disputed that:
Dever called the group’s statistics “questionable,” noting that they “don’t have valid, documented Ohio statistics.” He said Ohio payday lenders average seven loans a year to each customer.
Even if you settle in the middle, it demonstrates not everyone is using these to the point where they are living two week to two week using payday loans.
Part of the problem is the lack of true statistics, and some on both sides not being accurate.
August 13th, 2008 at 11:54 amIf you wanted to look at this from both sides, which most are not willing to do, what if that same person who borrowed the average of $328 even using the 12.6 – let’s round it up to 13. If that person bounced a check no matter the dollar amount 13 times in a year, just once?
It would cost them $325.00 compared to $641.29 (using the $49.33 figure) If they bounced a check twice 13 times, it would cost them $650.00, if they bounced a check three times? it would cost them $975.00 – of course they’d also have their checking account closed if they bounced that many checks in one year.
That is not counting any additional bank fees or what happens to most, when one check bounced it creates a scenario where more than one bounces.
What’s the bottom line both situations share? People not making enough money to cover their expenses…
August 13th, 2008 at 12:01 pmLeaving court today I was approached by a petition circulator regarding this issue. I played naive and asked some questions about the petition, the new law, and what the referendum would accomplish. The worker (no doubt counselled about lies given recent publicity) made no assertion I knew to be untrue. He simply said that the referendum would give Ohioans more of a CHOICE on financial decisions and allow the pay-day lenders to remain one of those choices.
After a brief contact, I commented that they had some bad press lately, to which he responded – All publicity is good publicity.
Greg: “The argument that we should all have the freedom to make bad decisions is a weak one.” If that is a summation of your core belief about life in America, then we have a fundamental disagreement about the issue and will have to agree to disagree, or, change the debate to one about our founding father’s vision, goals, democracy and liberty. Freedom and liberty are not weak arguments, they are the strongest.
TAHL
P.S. I of course signed the petition.
August 13th, 2008 at 2:31 pmI’m afraid I don’t see how being in debt for 6 months of the year constitutes freedom. And again, I suspect it would be a rare occurrence to run into some who supports capping interest rates on payday loans wouldn’t also support capping interest rates on bank fees and other financial products with APRs in the hundreds. The industry likes to cry wolf about bank fees, but it’s just an attempt to change the subject.
To the attorney in the room, I’d suggest listening to WCPN.org’s piece by Bill Cohen this morning about running into two additional petitioners who lied. I heard this on the radio on the way to work and I think it shows that the payday lobby and their petitioners’ looseness with the facts is a little more widespread that you’re suggesting.
August 13th, 2008 at 3:16 pmGreg, I’ve been doing some research on the petition gatherers, I’m wondering if you realize the implications of the accusations being made as far as progressive causes.
August 13th, 2008 at 3:29 pmI don’t deny that circulators are misinformed, make things up, and outright lie. I simply commented that the one I talked to, was more educated or careful given the recent news. I didn’t suggest it was limited in any way and not widespread or rampant.
Lisa brings a good point (I think this is her point, if not, apologies). In my experience it is “progressive” or “liberal” causes using petition drives and these organizations to “get the vote out,” thus, this mis-use/malfeasance may hurt causes close to the liberal heart more than my cold conservative one.
TAHL
August 13th, 2008 at 3:36 pmWell, I just went to get my plates renewed and there was a circulator for pay-day-lending. She came up to ask my to sign the petition to change the vote of Gov. Strickland that takes place this September. After asking her what vote that was she told me it was for pay day lending, you know the commercials you see on TV. I then was drilling questions to her like did it start in the house or senate, what was the bill number, did you hear about the stories of the circulators with this issue.
Well, she did know of the stories and said they did a re-hiring process to stop that problem and as for the other questions, she had to look at the a cheat Q&A sheet then asked me for a minute so she could read the petition to get the answers I was looking for. She said she just started but wouldnt say who she worked for.
Therefore, I did not sign it. I feel before they send people to get signatures they need to teach them the basic facts and the content of the petition. This is something that will have a lot of scrutiny and may not get on the ballot.
August 13th, 2008 at 4:08 pmThanks to the person above who mentioned the Ohio Public Radio report. Here is the link and it’s pretty funny:
http://www.wcpn.org/index.php/WCPN/news/13623/
August 13th, 2008 at 10:28 pmIt’s funny that there also seems to be a coordinated effort to go around to blogs and post the same material, including that link.
We’ve had more out of Toledo visitors for this discussion than any other topic I’ve blogged about. Most of which came from Columbus, it’s been interesting to watch the marketing aspect of this happen.
August 13th, 2008 at 10:35 pmCleveland reporting in lol. I think it’s a shame this petition drive wasn’t handled intelligently and yes now it makes them look even worse. But I agree with the figures Lisa used as an example. It’s not a black and white issue for me. I truly feel that they should be treated the same way banks are treated. It’s okay for certain banks to charge an over draft fee every four days which would put Lisa’s figures even higher. And make Pay Day seem even more affordable.
The real issue is the same one I see in my business (real estate). People somehow need to figure out how to manage their money. And of course there are people making so little there isn’t enough money to manage. As usual the issue is jobs…higher paying ones.
I don’t feel Pay Day Loans should be singled out. There is enough money-making off the backs of the poor to go around. This is just a feel good issue for legislators. And no, when approached, I did not sign the petition.
August 14th, 2008 at 12:13 amThe payday lobby is spending nearly $100,000 per day to convince folks that they need 391% interest! Between August 7th and August 12th, they spent $382,127 on their ‘farmer’ ad (very few ran on the 7th). And they’ve got their new heart wrenching ad with a mother and her two sons out. Expect more $100,000 days ahead! I wonder how much McCain and Obama are spending per day in Ohio during the Olympics?
August 14th, 2008 at 11:02 amGreg:
Spending on Political issues is SPEECH, a god given, constitutionally recognized and protected RIGHT! Its not about how much one side spends on the issue, its about whether the issue restricts your rights.
If you took a cab to the airport and paid $20, for a 10 minute drive, you would be paying $2 a minute, $120 an hour, and at 60 mph the same amount per mile. But, the short trip at $20 (given the alternatives) is reasonable. Would you take a cab to Miami? No the fee would bee in the thousands of dollars.
Yet no one is claiming that Cabbies charging $2 a mile are taking advantage of the poor who don’t own a car, don’t want to pay airport parking fees, or don’t want the risk of leaving their car in the lot long term. At $2 a mile in a car that gets 15 miles per gallon, they are charging $30 a gallon!
Pay-Day lending is the cab you take the the airport. The 391% interest is the calculated annual interest, if you keep the loan for a year and pay that rate — you just took a cab to Miami. In the short term, for which it is designed – $15 on $100 is a 15% rate, the ride to the airport.
Like many leftists, you demonize a subject by pointing to the dollars spent, yet focus on the misleading numbers and apply them inaccurately.
TAHL
August 14th, 2008 at 1:06 pmThe above analogy was stolen.
TAHL
August 14th, 2008 at 1:08 pmGreg said (and others insinuate)“The payday lobby is spending nearly $100,000 per day to convince folks that they need 391% interest!
No, the payday lobby is spending money to show that the public DESERVES the Right to Freedom of Choice, and NOT have the government dictate private business and every nuance of our lives.
How many freedoms are you willing to sacrifice before you stand up and say “I’ve had enough, and I’m not going to take it anymore”?
August 15th, 2008 at 8:10 amJust recently, David Kernell, the 20 year old son of Representative Mike Kernell (D-TN) was arrested. He was arrested for, according to CNN, resetting the password and gained access to vice presidential candidate Palin’s personal e-mail account. Allegedly, he read the contents, took screen shots of her E-mail directory, and got at some of her personal information. That information which has been compromised could include E-mail addresses and pictures of friends and family members, telephone numbers of family members including cell phone numbers, birthdates and more from her address book. After he turned himself in, he pled not guilty. He pled not guilty after he allegedly posted all of this to a public website. On top of all this, he also posted the password with which other people could access the account as well. David may get up to five years in prison, a $250,000 fine, and three years of supervision. Now think about this: $250,000 in $1,500 increments, the maximum amount a person can get with a payday loan comes out to 167 individual payday loans to free this turkey, before he gets made into Thanksgiving dinner by his cellmates.
October 11th, 2008 at 5:02 amPost Courtesy of Personal Money Store
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With just less than one week until the election, controversies surrounding both the Democrat and Republican camps continue to emerge. The most recent media storm has focused on the $150,000 that the Republican National Committee spent on new clothes for Vice Presidential Candidate Sarah Palin. Even though the story has generated a mountain of negative publicity and anti-Republican attacks, I refuse to let it sway my opinion. One has to consider that both Palin and Democratic Presidential hopeful Barack Obama have spent thousands on clothing, and it shouldn’t change the direction in which the vote is cast. I mean, we live in a society based on image and possessions; if a candidate didn’t spend money on her wardrobe I can only imagine the criticism she would receive then. If one candidate donned designer outfits and the other dressed in frumpy clothes, Americans would have much less respect for the latter candidate. Plus, look at the amount of attention Sarah Palin is receiving from her wardrobe! It doesn’t seem like such a bad political move because in the end, publicity is publicity. When it comes down to it, Americans should base their votes on the qualifications of the candidates, not the clothes they choose to wear. We should vote for the candidate that will protect our personal financial freedoms and the continued rights to no fax payday loans.
October 29th, 2008 at 5:19 amPost Courtesy of Personal Money Store
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If you’re a movie lover, you may have heard of the recently released Kevin Smith film called Zack and Miri Make a Porno. The film’s premise is that two lifelong friends and roommates, strapped for cash, debt piling up, decide to make a pornographic film in order to pay their bills off. Now, this kind of thing only happens in Hollywood, or at least that solution only does. The rest of us struggle in very real life with debt and paying bills. Those of us that don’t live on screen wouldn’t resort to that in order to make ends meet, because we have other options. You can always apply for bad credit installment loans to keep your lights on until your next paycheck.
November 6th, 2008 at 5:26 amPost Courtesy of Personal Money Store
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