This article first appeared in the St. Louis Beacon, Feb. 2, 2012 The Missouri secretary of state's office has approved for circulation two more initiative petitions that call for more restrictions on the payday loan industry.
But critics say the new petitions are a ruse advanced by the industry because the proposed interest rates could still be close to the 400 percent charged now.
The aim, says state Rep. Mary Still, D-Columbia, is to confuse voters about the critics' rival initiative petition drive for a proposed change in state law that would restrict payday loans to annual interest rates of no more than 36 percent.
One of the new petitions would limit interest rates to 360 percent a year. The other would restrict interest rates to 13.99 percent "unless the parties agree otherwise in writing."
(Click here to view the full texts of both petitions.)
"These are desperate and deceptive tactics by the industry,'' said Still. "They are trying to trick voters. They know they are going to lose."
She pointed out that the person submitting the two petitions, Jewell Patek, is a former state legislator who now works as a Jefferson City lobbyist. She contended he was acting on behalf of the payday loan industry.
Missourians for Equal Credit Opportunity, the chief group aligned with the payday loan industry, has yet to comment about the two new initiative petitions.
The chief opposition group is Missourians for Responsible Lending, which supports the initiative to restrict the payday loan interest rates to 36 percent a year.
"The out-of-state companies who want to keep charging 445 percent interest rates are going to try anything they can think of to confuse voters," the Responsible Lending group said in a statement late Wednesday.
"Last month, they tried to intimidate faith leaders with misleading and outrageous letters. This month, a Jefferson City lobbyist has filed petitions that would still allow such ridiculously high rates to continue. It's as transparent as it is sad."
The statement was referring to letters recently sent to Missouri churches and religious groupsthat are circulating the petitions to cap payday loan interest rates to 36 percent. The letters were sent on behalf of the Equal Credit group and asserted that the churches and religious groups could endanger their tax-exempt status by working on behalf of the initiative restricting payday-loan interest rates.
