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for people who care about the West

Predatory Ugliness


Jonathan Thompson's terrific piece about the payday loan business ("A pimp in the family," HCN, 6/23/14) spotlights some of the ugliest elements of the financial services business. Predatory lenders have found a lucrative niche in the largely unregulated world that flourishes in poor communities with immediate cash needs – like Native American reservations. Indeed, as Thompson's reporting points out, they seem to be more entrenched than ever.

As a former banking writer and editor, I found that as much as mainline banks have garnered criticism for their lending policies in low-income areas, their record is far better than that of their payday-loan cousins. Thompson's anecdote about a woman being charged an effective rate of over 1,100 percent on a $200 loan is astonishing, but unfortunately it reflects accepted practices.

That some Native American tribes would condone and actually welcome payday lending – especially the online variety – represents the saddest part of this story. Giving employment to some at the expense of ripping off hundreds or thousands of their own is indeed a dance with the devil.

Jeffrey Marshall
Scottsdale, Arizona