For Immediate Release: April 29, 2013
State of New York | Executive Chamber
Andrew M. Cuomo | Governor
CUOMO ADMINISTRATION OPPOSES BILL THAT WOULD LEGALIZE UNSAFE PAYDAY LOANS IN NEW YORK STATE
The Cuomo Administration today sent the following letter to New York State Assembly Speaker Sheldon Silver opposing the Short-term Financial Services Loan Act (Assembly Bill 1113-A).
Superintendent of Financial Services Benjamin M. Lawsky wrote in the letter that the bill "seeks to create an exception to New York's consumer protection laws to offer high-cost short term loans, and thereby legalize unsafe payday lending in the state."
The letter notes that fees allowed under the bill would allow lenders to charge interest rates to consumers that "balloon into triple digits," which are "the type of loans the current 25% criminal usury cap was designed to keep out of New York." Consumers who turn to these loans, the letter states, "often end up in a cycle of borrowing that leaves them far worse off as a result."
The opposition letter also states that: "The Bill would roll back long-standing and effective consumer protections and would expose consumers to loans by entities not regulated for their safe and sound lending operations. New York should not lower the bar on consumer protection."
To view the full letter from Superintendent Lawsky, please visit, link.