via CommonDreams:
Published on Thursday, September 16, 2010 by
Bankster.comBailed-Out Banks Finance Predatory Payday Lendersby Mary Bottari
American taxpayers bailed out the big banks. Now many of those banks are returning the favor by extending credit to payday lenders who sucker consumers into a spiraling debt trap.
That is the claim in a new report published this week by National People’s Action (NPA) the Chicago-based community organization. The report, called Preditors’ Creditors, names Wells Fargo, Bank of America, and JP Morgan Chase as some of the biggest lenders to the booming payday loan industry.
“The very same banks that helped tank the economy are now helping the bottom feeders of the industry,” says George Goehl, Executive Director of NPA. “The report shows that a $300 payday loan could end up costing you $750. If Al Capone was alive today, I bet you could get a better deal from him.“
Financing the Debt TrapWells Fargo, Bank of America, and JP Morgan Chase received $95 billion in Troubled Asset Relief Program (TARP) bailout funds in 2008 combined. These banks continue to be subsidized by the taxpayers, receiving near zero-percent interest funding via the Federal Reserve. While the big banks have been reluctant to invest in American factories and small businesses, they have decided to support the predatory payday loan industry which charges customers an average effective interest rate of 454 percent on small loans.
The Wall Street banks have extended $1.5 billion in credit over the last few years to publicly traded payday loan companies and almost double that when privately held payday loan firms are included. The estimated 22,300 payday loan stores nationwide make $30 billion in loans each year. Wells Fargo is the worst offender financing one third of the payday loan stores in America. ............(more)
The complete piece is at:
http://www.commondreams.org/view/2010/09/16-10 
Printer-friendly format
Email this thread to a friend
Bookmark this thread
(1000+ posts)
Send PM |
Profile |
Ignore
