AT THIS TIME I WOULD LIKE TO
CALL THE ASSEMBLY COMMITTEE ON
BANKING FINANCE TO ORDER --
FIRST OF ALL I WOULD LIKE TO
WELCOME NEW MEMBERS AT TO THE
COMMITTEE THAT WE HAVE THAT MISS
BETTER CAME HAN WHO IS A NEW
MEMBER.
AND MISS WICKS AND MISS MELENDEZ.
WHO WERE ALL AT NEW MEMBERS TO
THE COMMITTEE WELCOME?
WE DO HAVE QUORUM SO WE'RE GONNA
GO AHEAD AND CALL THE ROLL
PLEASE [inaudible]
CAN HERE [inaudible]
BAUER-KAHAN HERE [inaudible]
CERVANTES [inaudible]
CHOI HERE [inaudible]
GABRIEL [inaudible]
GRAYSON [inaudible]
MELENDEZ [inaudible]
STONE.
WEBER HERE.
WICKS HERE.
OUR RATES WE'VE ESTABLISHED
QUORUM -- WE ALSO WANT TO ADOPT
THE NEW COMMITTEE RULES AND
SINCE THIS IS THE FIRST.
BILL HEARING OF THE NEW SESSION
WE WANT TO ADOPT THE RULES AND I
WILL NEED A MOTION AND A SECOND.
THANK YOU SURGERY PLEASE CALL
THE ROLL [inaudible]
LIMON.
HI LIMON I CHEN.
CHEN I BAUER-KAHAN.
WHERE CAN I BURKE [inaudible]
CERVANTES.
CHOI AYE CHOI AYE GABRIEL
[inaudible]
GRAYSON.
HI GRAYSON AYE.
MELENDEZ -- IT SINCE THE RULES
HAVE CHANGED TO NOT HAVE EVERY
BILL HEARD BUT RATHER A MAY BE
HEARD AND I VOTE AGAINST ON THE
FLOOR I WILL BE VOTING AGAINST
THE RULES TO IN COMMITTEE
[inaudible]
NO [inaudible]
MELENDEZ NO [inaudible]
STONE [inaudible]
WEBER.
WEBER I WICKS FIVE WEEKS HI.
THANK YOU.
AND WE HAVE -- SEVEN EYES AND
ONE NO -- FOR THE ADOPTION OF
THE RULES AND WE WILL ALSO LEAVE
THAT OPEN -- FOR MEMBERS WHO ARE
NOT PRESENT TO ADD ON WE HAVE.
ONE BILL ON TWO BILLS ON CONSENT --
TODAY AND SINCE WE'VE
ESTABLISHED QUORUM -- I'D LIKE
TO SEE IF WE HAVE A MOTION FOR
THE CONSENT CALENDAR
[inaudible]
THANK YOU.
CAN WE THAT MINUTES LIKE A
COMPLETE CALL THE ROLL FOR THE
CONSENT CALENDAR.
AB AB FOR ONE TO DO PASSED
CONSENT TO APPROPRIATIONS IN
EIGHTY NINE ONE THREE TO PASS
CONTENT TO APPROPRIATIONS LIAM
ON BY THE MORE I CHEN.
GEN I BAUER-KAHAN.
WHERE CAN I BURKE [inaudible]
CERVANTES.
CHOI HI CHOI AYE GABRIEL
[inaudible]
GRAYSON.
GRAYSON AYE MELENDEZ MELENDEZ
AYE STONE.
WEBER.
WEBER I WEEKS FIVE WEEKS I
MEMBERS WE DO HAVE A THREE BILLS
TO ARE MINE AND WE WERE HOPING
THAT THE OTHER -- ASSEMBLY
MEMBER WOULD BE HERE SO IF WE
COULD START WITH HIS BILL SO.
IF WE COULD JUST HOLD ON FOR A
MINUTE OR SO -- WE'RE GONNA
CHECK THE HALLWAY AND SEE IF
[inaudible]
HE'S HERE
.
THE WHOLE WHOLE WHOLE
[inaudible]
FIFTEEN NEED TO
KNOW.
THANK YOU S. S. ONLY ARE MEDINA.
THANK YOU MADAM CHAIR.
NUMBER.
TODAY I PRESENT ASSEMBLY BILL.
ELEVEN EIGHTY SIX CALIFORNIA
PAWNBROKERS COME BEFORE THE
LEGISLATURE.
EVERY FIVE YEARS TO GET
LEGISLATIVE APPROVAL. TO JUDGE
THEIR MAXIMUM RATES AND FEES. TO
OFFSET THE INCREASED COST OF
OPERATION.
EACH OF THE COMMITTEE MEMBERS
OFFICES HAVE BEEN PROVIDED WITH
A COPY OF THE REPORT.
PREPARED BY THE INDUSTRY THAT
OUTLINES THE OPERATIONAL COSTS.
INCREASES SINCE THE LAST
ADJUSTMENT.
WHICH BECAME EFFECTIVE IN.
TWO THOUSAND FIFTEEN AND SB.
TWO EIGHTY FIVE PAWN BROKERS MAY
NOT RAISE THEIR FEES ARE RATES
TO OFFSET THE INCREASED COST OF
OPERATION.
THIS BILL WOULD JUST THE LOAN
SET OF FEE. TO THE GREATER OF
EITHER SEVEN DOLLARS AND FIFTY
CENTS.
OR THREE AND ONE HALF PERCENT OF
THE LOAN BALANCE.
BUT NOT TO EXCEED NINETY DOLLARS.
HERE WITH ME ON BEHALF OF AB.
ELEVEN EIGHTY SIX IS MISTER
BUILT DUPLICITY.
OF THE CALIFORNIA PAWN BROKERS
ASSOCIATION.
THANK YOU MA'AM GERMAN MEMBERS
BUILD A PLACE HERE REPRESENT THE
CALIFORNIA PAWNBROKERS
ASSOCIATION BY AGREEMENT WITH
CONSUMERS UNION WAY BACK IN --
TWO THOUSAND FOUR THE CALIFORNIA
PAWNBROKERS WHICH ARE ONE OF THE
FEW INDUSTRIES PERHAPS THE ONLY
I'M NOT REALLY SURE BUT WHO HAVE
TO ACTUALLY COME BEFORE THE
LEGISLATURE THE GOVERNOR ANYTIME.
A ALLOWABLE FEE INCREASE -- IS
NECESSARY -- WE MADE AN
AGREEMENT WITH THEM THAT WE
WOULD DO THIS NO MORE OFTEN THAN
EVERY FIVE YEARS SO.
HERE WE ARE IN NINETY AND TWO
THOUSAND NINETEEN FOR THE
EFFECTIVE DATE BIG TWO THOUSAND
TWENTY AND A FIVE YEAR
ANNIVERSARY -- AND WE HAVE THIS
YEAR SOMETHING ALL DIFFERENT
THAN WE USUALLY DO THE THE RATES
AS WELL AS THE FEES THE LOVABLE
INTEREST RATES AS WELL AS
CHARGEABLE FEES.
ARE ORDINARILY DONE IN THIS BILL
EVERY FIVE YEARS.
THIS YEAR PARTIALLY BECAUSE IT
APPEARS AS THOUGH THE FEDERAL
GOVERNMENT MAY INTERVENE ON A
NATIONAL LEVEL WITH THE FEDERAL
LAW THROUGH THE ALWAYS FORGET
THE NAME WITH HIS OF THE
CONSUMER FINANCIAL PROTECTION
BUREAU CFPB -- THERE ARE NO
INTEREST RATE -- INCREASES ASKED
FOR IN THIS OR JUDGMENTS OF THIS
BILL ONLY IN THE FEES THAT THE
ASSEMBLYMAN AND JUST.
A NEW RATED -- ACTUALLY THE
THERE'S REALLY NOT MUCH MORE TO
SAY -- I'D BE HAPPY TO ANSWER
ANY QUESTIONS YOU MAY HAVE ABOUT
THIS SAID IN A PREVIOUS SUPPORT
FOR THIS MUCH NEEDED LEGISLATION
TO KEEP US IN PACE WITH RISING
COSTS.
THANK YOU WE HAVE A MOTION AND A
SECOND ANY OTHER ADDITIONAL
WITNESSES AND SUPPORT PLEASE
COME TO THE MICROPHONE.
SEEN THEN ANY WITNESSES IN
OPPOSITION.
ALRIGHT WE HAVE A MOTION A
SECOND MADAM SECRETARY PLEASE
CALL THE ROLL.
MEMBERS COMMENTS OR QUESTIONS.
SEEN AND MADAM SECRETARY PLEASE
CALL HER.
THE MOTION IS TO PASS LIMON.
HI LIMON HIGH CHEN.
AND I OUR CAN'T.
WHERE CAN I BURKE [inaudible]
CERVANTES.
CHOI HI CHOI AYE GABRIEL.
A REAL AYE GRAYSON.
GRAYSON AYE MELENDEZ.
MELENDEZ AYE STONE.
STONE I WEBER.
LABOR I WICKS.
WICKS I THE BILL HAS TEN VOTES --
WE EAT MOVES FORWARD AND WE WILL
A PLACE -- THE THE BILL ON CALL
FOR MEMBERS TO ADD ON THANK YOU
VERY MUCH.
GREATER THANK YOU.
AND NOW I'M I'M GOING TO PASS IT
OVER TO THE VICE CHAIR -- SINCE
I WILL BE PRESENTING THE NEXT TO
BILLS WILL START WITH -- FIVE
THIRTY NINE AND THEN
.
SIX FORTY TWO AB FIVE THREE NINE
AUTHORED BY TOURNAMENT Là MON --
AS A REMINDER WE'RE LIMITING
TESTAMENT EIGHT MINUTES -- MADAM
CHAIR AT YOUR PLEASURE.
AND JUST TO CLARIFY IT SETS
MONEY AFTER THE AUTHOR'S COMING.
AND ASSEMBLY MEMBER.
GRAYSON AS THE JOINT AUTHORS
WILL ALSO BE AS WORKING WITH ME
ON THIS PARTICULAR BILL.
THANK YOU VICE TREND MEMBERS AB
FIVE THIRTY NINE IS AN IMPORTANT
CONSUMER PROTECTION BILL THAT IS
YEARS OVERDUE.
THE UNDER UNREGULATED INTEREST
RATE ENVIRONMENT IN CALIFORNIA
HAS LED TO AN EXPLOSION OF HIGH
COST LOANS OVER THE PAST DECADE
THESE LOANS START AT TWO TWENTY
FIVE HUNDRED DOLLARS AND HAVE
INTEREST RATES FROM A HUNDRED TO
MORE THAN 2100%.
FAR TOO OFTEN CONSUMERS ARE
UNABLE TO REPLACE THESE
EXPENSIVE LOANS DATA PROVIDED BY
HAAS HI COST LENDERS TO OUR
STATE REGULATORS SHOW THAT
APPROXIMATELY ONE OUT OF THREE
LOANS ARE WRITTEN OFF BY LENDERS.
BUT A WRITTEN OFF ALONE IS NOT
THE END OF THE STORY LENDERS
SELL THESE WRITTEN OFF LOANS TO
DEBT COLLECTORS WHO REMITTANCE
RELENTLESSLY PURSUE CONSUMERS
FOR THE AMOUNT OWED.
THIS PROCESS RESULTS IN DAMAGE
CREDIT FOR CONSUMERS AND CAN
LEAD TO THEIR PAYCHECKS BEING
GARNISH THEIR BANK ACCOUNTS
CLOSED OR THEIR CAR BEING
REPOSSESSED. ONE OUT OF THREE
TIMES.
AND I CANNOT THINK OF ANY OTHER
PRODUCT THAT FEELS SO OFTEN
WITHOUT GOVERNMENT STEPPING IN
TO INTERVENE.
HI COST LENDERS WHO OPPOSE THIS
BILL SAY THAT THEY NEED TO
CHARGE SUCH HIGH RATES TO MAKE
UP FOR CONSUMERS WHO DEFAULT.
BUT THESE RATES PLAY A CRITICAL
ROLE IN MAKING THESE LOANS AND
AFFORDABLE IN THE FIRST PLACE
LET'S WALK THROUGH A COMPARISON.
TAKE IN TAKE FOR EXAMPLE A TWO
YEAR TWENTY SIX HUNDRED LOAN
WHICH IS A FAIRLY COMMON PRODUCT
IN THE MARKET.
IF THE CONSUMER GET THIS LOAN
FROM A RESPONSIBLE THE LENDER
CHARGING 36% THEIR MONTHLY
PAYMENT WOULD BE ABOUT A HUNDRED
AND FIFTY DOLLARS AND THEY WOULD
PAY BACK A TOTAL OF THIRTY SEVEN
HUNDRED DOLLARS OVER THE LIFE OF
THE LOAN.
ON THE OTHER HAND IF A CONSUMER
GETS A LOAN FROM A HIGH COST
PROVIDER WITH THEIR MONTHLY PAY
THEIR WITH THEIR MONTHLY
PAYMENTS WOULD JUMP TO FOUR
HUNDRED AND FIFTEEN AND THEY
WOULD PAY BACK A TOTAL OF A
NEARLY ELEVEN THOUSAND DOLLARS
AND THAT SAME TWENTY SIX HUNDRED
DOLLAR.
LOAN.
ARE WE REALLY WILLING TO BELIEVE
THAT DEFAULTING ON SUCH A LOAN
IS DUE TO THE RISKY NESS OF THE
CONSUMER AND NOT BECAUSE OF THE
SKY HIGH INTEREST RATE CHARGED
BY THE LENDER.
THE OUTCOMES OF THIS UNREGULATED
SPACE ARE CLEAR.
THESE HIGH INTEREST RATES ALLOW
LENDERS TO REMAIN SUSTAINABLY
PROFITABLE.
EVEN WHEN ONE THIRD OR MORE OF
THEIR BARRELS ULTIMATELY DEFAULT
ON THE LOAN.
AB FIVE THIRTY NINE WILL PUT A
STOP TO THIS RIGHETTI.
AT RINGGIT RIGID INCENTIVE
STRUCTURE THE IDEA THAT
CONSUMERS WILL NOT HAVE CREDIT
OPTIONS IF THIS BILL PASSES IS
NOT REALISTIC THE RESPONSIBLE
LENDERS TO SUPPORT THIS BILL
HAVE FOUND WAYS TO OFFER
AFFORDABLE CREDIT OPTIONS TO
BARS WITH DAMAGE CREDIT FOR EVEN
NO CREDIT SCORE AT ALL.
AND LET'S BE CLEAR CALIFORNIA IS
AN OUTLIER WE ARE AMONG A SMALL
MINORITY OF STATES THAT DO NOT
CAP INTEREST RATES ON THESE
LOANS BOTH RED AND BLUE STATES
CAP THE INTEREST RATES. 80% OF
PEOPLE IN THE UNITED STATES IN
THE UNITED STATES LIVE IN A
STATE WHERE THE RATE IS CAPPED
ON THIS PARTICULAR PRODUCT.
I HAVE WORK TO FIND A COMPROMISE
THAT COULD EARN THE SUPPORT FROM
BOTH CONSUMER GROUPS AND LENDERS
ALIKE AND AB FIVE THREE NINE IS
THE RESULT OF THOSE NEGOTIATIONS.
WE HAVE A STRONG AND GROWING
COALITION OF LOCAL GOVERNMENTS
LABOR ORGANIZATIONS RELIGIOUS
ORGANIZATIONS AND VETERANS
GROUPS TO SUPPORT THESE EFFORTS.
I WILL NOW TURN MY TIME OVER TO
JOINT AUTHORED A SOME MEMBER TIM
GRAYSON WHO HAS BEEN A VALUABLE
PARTNER TO MEET WITH THESE
EFFORTS.
THANK YOU TO MY JOINT AUTHORED
MADAM CHAIR AS WELL AS VICE
CHAIR AND MEMBERS.
AS MANY OF YOU KNOW I REPRESENTS
SOME OF THE MORE ECONOMICALLY
DISADVANTAGED AREAS AND THE
GREATER BAY AREA.
SINCE MY TIME ON THE CONCORD
CITY COUNCIL I HAVE STRUGGLED
WITH THIS VERY QUESTION OF
ACCESS OR THE QUESTION OF
INTEREST RATES AND CONSUMER
PROTECTIONS.
WITH THAT IN MIND I BELIEVE THAT
AB FIVE THIRTY NINE REPRESENTS
THE BEST PUBLIC POLICY BALANCE
THAT THIS LEGISLATURE HAS
CONSIDER ON THIS ISSUE IN RECENT
MEMORY.
WE KNOW THAT SINCE THE START OF
THE GREAT RECESSION IN TWO
THOUSAND EIGHT THE STATE OF
CALIFORNIA HAS SEEN AN EXPLOSION
AND HIGH COST PREDATORY LENDING
INTO THE SUBPRIME MARKET.
FROM 200-082-2000 SEVENTEEN THE
LAST YEAR WE HAVE DATA FOR
TRIPLE DIGIT LOAN VOLUMES HAVE
INCREASED OVER 17000%.
ACCORDING TO THE DEPARTMENT OF
BUSINESS OVERSIGHT APPROXIMATELY
ONE THIRD OF ALL HIGH COST LOANS
ENDED DEFAULT.
AND FOR THOSE LOAN SECURED BY A
CAR TITLE THE NEGATIVE OUTCOME
IS EVEN GREATER BECAUSE
REPOSSESSION CAN DEPRIVE A
BORROWER OF THEIR ABILITY TO BE
ABLE TO TRAVEL TO THEIR WORK.
MEMBERS I'D LIKE YOU TO CONSIDER
THIS QUESTION.
IS THERE ANY PRODUCT THAT IS
LEGAL TO SELL IN CALIFORNIA THAT
FAILS MORE THAN ONE THIRD OF THE
TIME.
I CERTAINLY CANNOT THINK OF ONE
SO WHY DO WE ALLOW HUNDREDS OF
THOUSANDS OF OUR CONSTITUENTS
FRIENDS AND FAMILY MEMBERS TO
CONTINUE TO FACE FINANCIAL RUIN
THROUGH TRIPLE DIGIT LENDING.
AB FIVE THIRTY NINE REPRESENTS A
HISTORIC OPPORTUNITY TO REIN IN
PREDATORY LENDING HERE IN THIS
STATE.
YOU WILL HEAR FROM A BROAD
COALITION OF CONSUMER GROUPS
LENDERS LOCAL GOVERNMENTS AND
FAITH BASED ORGANIZATIONS ALL IN
SUPPORT OF FIVE THIRTY NINE THEY
RIGHTFULLY RECOGNIZE THAT FOR
THAT. FOR TOO LONG THESE
EXORBITANTLY PRICED BLOWN
PRODUCTS ARE NOT ACTUALLY HOPING
CONSUMERS AND THAT ACCESS TO
CAPITAL CAN NO LONGER BE AN
EFFECTIVE ARGUMENT TO
MAINTAINING THE PREDATORY STATUS
QUO.
I BELIEVE THAT TODAY THANKS TO
THE HARD WORK OF ALL
STAKEHOLDERS BUT ESPECIALLY DARK
CHAIR MS Là MOAN AND HER STAFF
WE HAVE FOUND A BALANCE THAT
WILL ENSURE A ROBUST MARKETPLACE
FOR SMALL DOLLAR LENDING.
WHILE WEEDING OUT THE MOST
EGREGIOUS PRODUCTS SINCE THE
INTRODUCTION OF AB FIVE THIRTY
NINE I HAVE SPENT TIME AROUND MY
DISTRICT TALKING TO CONSTITUENTS
ABOUT SMALL DOLLAR INTEREST
RATES.
WITHOUT FAIL THEY ARE SHOCKED
THAT WE HAVE ALLOWED THE CURRENT
MARKET PLACE TO IT TO PERSIST.
I ENCOURAGE YOU TO JOIN ME IN
BRINGING ECONOMIC FAIRNESS AND
JUSTICE BACK TO THIS MARKETPLACE
BY SUPPORTING AB FIVE THIRTY
NINE AND THANK YOU.
THANK YOU VERY MUCH FOR TAX
MONEY FOR OTHER WHEN THIS IS A
IN SUPPORT PLEASE IDENTIFY
YOURSELF THANK YOU MISTER CHAIR
NUMBERS FATE CALMLY WITH THE LA
COUNTY BOARD OF SUPERVISORS.
I'LL BE VERY BRIEF TODAY I'M
HERE TO ANSWER A QUESTION I'VE
BEEN GETTING FOR THE PAST
SEVERAL MONTHS WHICH IS WHY IT'S
LA COUNTY SPONSORING.
AB.
FIVE THIRTY NINE NOT MANY ARE
AWARE OF OUR BOARD'S COMMITMENT
TO CURBING THE EFFECTS OF THESE
HIGH COST LOANS IN OUR
COMMUNITIES.
AFTER RESEARCH BY THE GPO FOUND
THAT OVER 60% OF HIGH COST LOAN
STORE FRIENDS ARE CONCENTRATED
IN AREAS WITH FAMILY POVERTY
RATES WELL ABOVE THE STATE
AVERAGE.
OUR BOARD REALIZE THAT IT NEEDED
TO ACT TO PROTECT VULNERABLE
RESIDENTS FROM THE HARMFUL COST
OF THESE LOANS.
IN TWENTY SEVENTEEN OUR COUNTY
DEPARTMENT OF CONSUMER AND
BUSINESS AFFAIRS WITH DIRECTED
TO FORM A WORKING GROUP THAT
WOULD STUDY OPTIONS TO REDUCE
THE NEGATIVE IMPACTS THESE LOANS
HAVE ON COUNTY COMMUNITIES.
AND TO CREATE A COMPREHENSIVE
MARKETINGCAMPAIGN THAT WOULD
FOCUS ON EDUCATION AND OUTREACH
TO THOSE MOST VULNERABLE TO
THESE LENDERS.
WE ARE PARTNERING WITH COMMUNITY
BASED ORGANIZATIONS TO PROVIDE
FINANCIAL EDUCATION CONSUMERS
AND TO INFORM PEOPLE ABOUT
COUNTY SERVICES AND BENEFITS.
WHILE DETERMINING WHAT WE CAN DO
AT THE LOCAL LEVEL TO PROVIDE
ALTERNATIVES TO HIGH COST LOANS.
THAT ARE TRAPPING OR COMMUNITIES
AND A NEVER ENDING CYCLE OF DEBT.
A GREAT AMOUNT OF WORK IS BEING
DONE BY THE LA COUNTY BOARD OF
SUPERVISORS IN OUR COUNTY STAFF.
AS WELL AS COMMUNITY CUT
COMMUNITY PARTNERS BUT IT'S NOT
ENOUGH.
I RECOGNIZE THAT NO MATTER THEM
OUT OF EDUCATION PARTNERSHIPS
AND ZONING ORDINANCES CHANGE
NEEDS TO OCCUR AT THE STATE
LEVEL TO ASSIST LOCAL
GOVERNMENTS.
AND STOPPING THE PREDATION ON
THOSE WERE SIMPLY TRYING TO MAKE
THE BEST OF POOR OPTIONS.
THE BOARD THANKS ASSEMBLY MEMBER
LOW MOAN FOR HER COMMITMENT TO
THIS NECESSARY REFORM THAT WILL
ALLOW LA COUNTY AND OTHERS TO
FURTHER HELP OUR COMMUNITIES
BUILD AND MAINTAIN FINANCIAL
HEALTH.
THANK YOU MISTER VICE CHAIR
MEMBERS OF THE COMMITTEE MY NAME
IS CHRISTINE ABBAS HAMILTON I'M
HERE REPRESENTING YOU D. W. APPS
ME -- WE REPRESENT A HUNDRED TEN
THOUSAND AYE HSS.
PROVIDERS IN HOME SUPPORTIVE
SERVICES PROVIDERS AND OF
COURTING TO THE DATA THE AVERAGE
INCOME OF BORROWERS OF THESE
PAYDAY LOANS ANOTHER SHORT TERM
HIGH INTEREST LOANS A HAVE
ANNUAL INCOMES BETWEEN. TEN
THOUSAND AND FORTY THOUSAND
DOLLARS A YEAR AND THAT SQUARELY
DESCRIBES OUR MEMBERSHIP OUR
FOLKS EARNED FOR THE MOST PART
MINIMUM WAGE.
THEY CARE FOR LOW INCOME SENIORS
AND PEOPLE WITH DISABILITIES A
LOT OF THE TIMES THEY ARE FAMILY
MEMBERS.
AND SO THE HOUSEHOLD INCOME IS
VERY LOW IN OUR MEMBERS ARE
THOSE COMMUNITIES THAT
UNFORTUNATELY ARE MORE
SIGNIFICANTLY IMPACTED BY.
THE HIGH INTEREST RATES THAT
THESE LOANS -- ARE AFFORDING
THEM BECAUSE AS MY COLLEAGUE
HERE SAID THESE ARE PEOPLE IN
DESPERATE SITUATIONS WHO DON'T
HAVE A LOT OF GOOD CHOICES IN
TERMS OF ACCESSING MONEY AS SOON
AS THEY NEED IT.
WE WANT TO SUPPORT THE BILL AND
WE THINK -- THE CHAIR AND
ASSEMBLY MEMBER GRAYSON FOR FOR
INTRODUCING IT BECAUSE THIS IS A
VERY STRONG PUBLIC POLICY ISSUE.
FOR LOW INCOME PEOPLE -- OUR
ORGANIZATION WE ADVOCATE FOR
POLICIES THAT HELP OUR MEMBERS
IN GENERAL ESPECIALLY WHEN IT
COMES TO PAYCHECK ISSUES AND WE
BELIEVE THAT THIS BILL IS
EXTREMELY IMPORTANT.
AND WE STRONGLY SUPPORTED THANK
YOU.
THANK YOU VERY MUCH MY NAME IS
MABEL LEASE BROWN I'M THE
EXECUTIVE DIRECTOR OF HOUSING
AND ECONOMIC RIGHTS ADVOCATES
WERE BASED IN OAKLAND WE PROVIDE
FREE LEGAL SERVICES ACROSS THE
STATE OF CALIFORNIA THE LOW AND
MODERATE INCOME RESIDENTS.
PLEASED TO BE ABLE TO SPEAK IN
SUPPORT OF THIS BILL.
AND I WANTED TO SHARE A COUPLE
OF CLIENTS STORIES WE PROVIDE
DIRECT SERVICES WE DO POLICY
WORK.
ON WITH PARTNERS AROUND THE
TABLE AROUND THE ROOM -- BUT I
THINK PUTTING SOME CLIENTS
STORIES OUT THERE HELPS TO
REALLY ILLUSTRATE WITH PEOPLE
THING GOING THROUGH SO -- ONE OF
THE ONE OF THE COMMON THEMES
THAT WE'VE SEEN IS THAT PEOPLE
ARE BEING LET MORE MONEY THAN
WHAT THEY ASKED FOR WHAT THEY
THOUGHT THEY NEEDED IN ORDER TO
GO AHEAD AND PUT THEM IN THE
TERRITORY OF THE EXEMPTION TO
CURRENT EXEMPTION TO THE
INTEREST RATE CAPS -- SO IN ONE
CASE WE ARE SERVED A THIRTY NINE
YEAR OLD WOMAN SEPARATED FROM
HER SPOUSE MONTHLY INCOME OF
SIXTEEN HUNDRED EIGHTY DOLLARS A
MONTH TO SUPPORT HER AND HER TWO
CHILDREN -- SHE GOT A LOAN FROM
LOAN MARTIN.
TWENTY SEVENTEEN ONLINE THEN
QUICKLY FELL BEHIND THE LETTER
BORROW FOUR THOUSAND DOLLARS SHE
HAD ASKED FOR A THOUSAND DOLLARS
TO SUPPORT HER MEDIA IT NEEDS.
BY THE TIME SHE CAME TO MY
OFFICE SHE HAD ALREADY PAID THEM
TEN THOUSAND DOLLARS.
ON HER FOUR THOUSAND DOLLAR LOAN
AND STILL OWE THEM ANOTHER NINE
THOUSAND DOLLARS BECAUSE THE
INTEREST RATE.
I AM REPAYMENT PERIOD WAS SO
LENGTHY HER MONTHLY PAYMENTS FOR
FIVE HUNDRED FIFTY TWO DOLLARS
EVERY MONTH.
AW AND AT SOME POINT SHE ENDED
UP FLIPPING OUT LOAN AGAIN WITH
LOW MARK BECAUSE SHE JUST
COULDN'T KEEP UP WITH THAT AND
YET WAS TRYING TO STAY CURRENT.
SO THE DEVASTATION THE PEOPLE
IT'S NOT JUST IN THE MOMENT IT'S
NOT JUST THE EMOTIONAL THE SHAME
AND THE STRESS OF TRYING TO KEEP
UP IT IS ALSO SEVEN YEARS OF
DAMAGE TO YOUR CREDIT REPORT.
IN WHAT IS AN INEVITABLE -- BAD
ENDING TO THESE KINDS OF ONES WE
HAVEN'T SEEN ANYBODY ABLE TO GET
OUT OF THESE LOANS WITHOUT --
SIGNIFICANT DAMAGE.
HER INTEREST RATE ON THIS LOAN
WITH A HUNDRED AND SEVEN POINT
7% -- IN.
ANOTHER STORE I WANT TO SHARE.
SEVEN YEAR OLD RENTER RESEARCH
WHO WAS WIDOWED WAS LIVING ON
FOUR THOUSAND DOLLARS A MONTH IN
SOCIAL SECURITY AND PENSION.
OF FUNDS SHE GOT A LOAN FROM
CASH CALL SHE'D BEEN PAYING ON
INTO -- SINCE TWO THOUSAND
THIRTEEN AT AND FOR WELL OVER A
100% INTEREST RATE -- SHE'D
ALREADY PAID OVER FIFTEEN
THOUSAND DOLLARS ON A FORTY
SEVEN HUNDRED DOLLAR LOAN BY THE
TIME SHE GOT TO MY OFFICE FOR
HELP.
OF WITH ANOTHER SIX THOUSAND
DOLLARS THAT SHE WAS DUE TO PAY
ON THIS LOAN -- INTEREST RATE
WAS A 117% THING IS THEY'RE JUST
VERY FEW THERE'S NOT MUCH BUT
THERE'S NOT A LOT WE CAN DO FOR
PEOPLE AT THAT POINT BECAUSE THE
LAW HAS NOT BEEN PROTECTIVE.
AND WHEN PEOPLE HAVE STEPPED
INTO THESE LOANS -- PEOPLE
IMAGINE THAT WHEN A PRODUCT IS
ALLOWED TO EXIST THAT MAYBE IT'S
NOT GOING TO BE IS DAMAGING WHY
WOULD THE GOVERNMENT ALLOW THESE
THINGS TO GO ON IF IT WERE SO
TERRIBLY TERRIBLY DAMAGING
THERE'S A HUGE AMOUNT OF
INNOCENCE -- THAT PEOPLE HAVE
WHEN THEY STEP IN AND WHEN WE
LOOK AT THE INTEREST RATE --
WHEN THE AMOUNT OF THE MOUNT
THAT IS LINKED TO PEOPLE
COMPARED TO THEIR INCOME?
IT WAS CLEARLY LOAN THAT THEY
WERE NEVER GOING TO BE ABLE TO
REPAY SOUTH THANK YOU VERY MUCH --
FOR SPONSORS WORK ON THIS
AUTHORS WORK ON THIS -- ONE BILL
CAN THANK YOU FOR LISTENING.
MISTER CHAIR MEMBERS OF THE
COMMITTEE SCOTT GOVERNOR HERE
BEHALF THE CALIFORNIA FINANCIAL
SERVICES ASSOCIATION.
FIRST I'D LIKE TO THANK THEIR
OFF THE AUTHORS FOR THEIR WORK
ON THIS EFFORT WE OPPOSED MR
CALORIES BILL LAST YEAR.
IT WOULD HAVE PRECLUDED MY
MEMBERS FROM LANDING IN THE
STATE OF CALIFORNIA.
THIS BILL DOES NOT DO THAT -- MY
MEMBERS INCLUDE -- CONSUMER
FINANCE LENDERS BIG AND SMALL
TRADITIONAL BRICK AND MORTAR
SHOPS.
THEY ISSUE LOANS THAT 36% OR
BELOW THEIR CHARGE OFF RATES ARE
IN THE SINGLE DIGITS -- AS TO
THE FICUS SCORES BECAUSE IT'S
BEEN SUGGESTED THAT WE LEARN TO
PEOPLE WITH ONLY BETTER FICUS
SCORES ARE MEMBERS OFTEN RIGHT
PEOPLE WITH NO FICUS SCORES THIS
IS A FUNCTION OF UNDERWRITING
THIS IS WHAT WE DO INSPIRED
CHARGE OFFS ARE SO LOW.
LASTLY A BIG COMPONENT OF OUR
BUSINESS IS ACTUALLY GETTING
PEOPLE OUT OF THESE LOANS PEOPLE
COME IN WITH THAT LOANS THE
TERMS THAT WERE PREVIOUSLY
SUGGESTED.
AND WE TRY TO GET THEM OUT OF
THOSE LOANS SO TO THE EXTENT
THOSE PEOPLE QUALIFY FOR OUR
LOANS THAT WOULD HAVE QUALIFIED
IN THE FIRST PLACE.
AFTER THE BUSINESS REASON FOR
SUPPORTING THE SPELL.
WE WANT CERTAINTY THE MARKET
PLACE THERE WAS A CASH CALL
DECISION BUT SIX EIGHT MONTHS
AGO.
THE DEEMED THEIR LOANS
UNCONSCIONABLE THE COURT DID NOT
DEFINE WHAT CONSTABLE WAS CREATE
SOME UNCERTAINTY FOR US WE ALSO
BELIEVE GIVEN THAT -- THE FACT
THAT SO MANY OTHER STATES HAVE
INTEREST RATE CAPS THERE WAS A
LEGITIMATE.
EFFORT UNDER WAY TO GO TO THE
BALLOT WE WOULD HAVE LOST THAT
FIGHT AND IT WOULD HAVE
PRECLUDED US FROM BEING IN THE
MARKET.
BASED ON THE HISTORICAL MODELS
IF YOU LOOK AT THE CAL REBEL FOR
EXAMPLE.
SO WE WANT STABILITY IN THE
MARKET WE THINK THIS DOES THAT
WE AGAIN -- APPRECIATE THE WORK
OF THE AUTHORS AND AN URGE YOUR
SUPPORT THANK YOU.
THANK YOU VERY MUCH ANY OTHER
WITNESSES -- IN SUPPORT NAMED
AFFILIATION PLEASE.
HI HI SABRINA HAM ON BEHALF OF
THE CALIFORNIA ASSET BUILDING
COALITION IN CALIFORNIANS FOR
ECONOMIC JUSTICE IN SUPPORT
THANK YOU.
ONLY SEE A LUIS ON BEHALF OF ANY
THOSE US FORMALLY THE NATIONAL
COUNCIL BUT ALSO THE COUNTRY'S
LARGEST LATINO CIVIL RIGHTS
ORGANIZATION IN STRONG SUPPORT.
CHRIS RESPONSE AS A TRUE THOUGH
THE COALITION OF REMAINING
RIGHTS INSTRUCTS SUPPORT.
OSCAR GONZALEZ FROM OUR OUTRA
FORMERLY IN SEAT UPON THE
PROGRAM LENDER IN SUPPORT.
CAROLING I WITH THE SOLANO
COUNTY BOARD OF SUPERVISORS IN
SUPPORT.
MY CAN IT'S IN HERE ON BEHALF OF
OPPORTUNE IN SUPPORT.
BRIAN FLANAGAN ON BEHALF OF ONE
MARK FINANCIAL SERVICES IN
SUPPORT.
POTENTIAL WITH KP PUBLIC AFFAIRS
HERE ON BEHALF OF ONE MAIN
FINANCIAL WHO ALSO SUPPORT THE
BILL.
I TERM MEMBERS OUTLAND TRITON ON
BEHALF OF NEXT GEN CALIFORNIA
AND CONSUMER ATTORNEYS OF
CALIFORNIA THANK YOU VERY MUCH.
STRUCTURE MEMBERS MIKE MONNA
GONNA BE HALF OF THE CITY AND
COUNTY OF SAN FRANCISCO OFFICE
OF FINANCIAL EMPOWERMENT IN THE
TREASURER'S OFFICE IN SUPPORT.
GOOD AFTERNOON DANIEL CAN OCCUR
AS OUR BEHALF OF THE CALIFORNIA
LOW INCOME CONSUMER COALITION
WILL BE REMAIN NEUTRAL WE THINK
THIS IS A STEP IN THE RIGHT
DIRECTION.
WE LOOK FORWARD TO CONTINUING
CONVERSATION THANK YOU.
THANK YOU VERY MUCH AND WE HAVE
THE WITNESSES AND OPPOSITION
PLEASE.
AND OF FROM REMINDER -- OUR
TESTIMONIES EIGHT MINUTES
.
MISTER VICE CHAIRMAN MEMBERS
PAUL LET BUILT A REPRESENTING
ACCESS FINANCIAL AND CHECK INTO
CASH -- WE OWE OUR LENDERS THAT
WOULD BE AFFECTED BY THIS
PARTICULAR BILL -- I HAVE GREAT
RESPECT FOR BOTH THE CHAIR.
ON THE MISTER GRAYSON -- AND
THERE.
A DESIRE TO WANT TO ADDRESS THIS
ISSUE WHAT DID YOU WANT TO SAY
THAT.
WE REPRESENT THOSE LENDERS THAT
HAVE 70% AND HIGHER INTEREST
RATE LOANS I'M NOT -- I'M I'M
NOT.
APOLOGETIC ABOUT THAT.
BECAUSE THE PEOPLE THAT.
I'VE READ LETTERS FROM OUR
CUSTOMERS.
WANT TO BE ABLE TO HAVE ACCESS
TO CREDIT.
AND JUST BECAUSE THEY HAVE A LOW
CREDIT SCORE.
DOESN'T MEAN THAT THEY'RE STUPID
CUSTOMERS -- LOTS OF DIFFERENT
SITUATIONS THAT PUT HIM INTO
THAT PREDICAMENT -- WE BELIEVE
THAT IF THERE ARE SPECIFIC AREAS
THAT NEED TO BE ADDRESSED IN
TERMS OF CONSUMER REFORMS.
THAT WE SHOULD HAVE A DEBATE
ABOUT THOSE AREAS -- WE'VE BEEN
CALLED PREDATORY LENDERS OVER
NOT PREDATORY LENDERS WERE A
REGULATED LENDER -- PREDATORY
LENDER THIS.
IS NOT PREDATORY JUST BY VIRTUE
OF THE FACT THAT IT'S A HIGH
INTEREST RATE.
THERE ARE OTHER FACTORS INVOLVED
WITH BEING PREDATORY LENDERS --
HOWEVER.
THERE WOULD BE ABOUT ONE POINT
THREE BILLION DOLLARS OF ACCESS
TO CREDIT.
THAT WOULD BE ELIMINATED AS A
RESULT OF THIS BILL BY THE FACT
SHEET THAT IS PROVIDED BY THE
AUTHOR.
THE QUESTION YOU HAVE TO ASK
YOURSELF IS WORDED THESE PEOPLE
GO.
AND WE WOULD -- SAY THAT THEY
WOULD GO TO THE UNREGULATED
MARKET PLACE THAT COULD BE.
A VARIETY OF AREAS COULD BE
UNREGULATED INTERNET.
COULD BE TRIBAL ENDING THEIR
SOVEREIGN NATIONS ARM.
AND AREN'T REGULATED IN THE SAME
WAY THAT OURS ARE REGULATED.
AND BEFORE YOU VOTE ON THIS BILL
I JUST LIKE YOU DO AT LEAST
THINK ABOUT THE FACT THAT --
THAT'S WHAT'S GOING TO HAPPEN.
OF THERE ARE STUDIES AND THERE'S
INFORMATION.
AND I LISTEN TO THE TESTIMONY OF
LAST WEEK BY -- FORMER CHAIR OF
THE SEA OF P. B. -- CHAIRMAN
CORDUROY.
THIS AND SEEM TO SAY THAT THERE
WAS NO IMPACT.
ON REDUCING THE INTEREST RATES
DOWN 236% THERE IS IN FACT AN
IMPACT -- ORGAN OF FOR EXAMPLE
HAD THE HIGHEST -- RATE OF
INTERNET.
OF FRAUD -- AFTER THEM PASSING A
SUCH AN INTEREST RATE.
AND THERE ARE OTHER STATES OF
ALSO HAD -- FINANCIAL IMPACT ON
THEIR G -- THEIR CITIZENS OF
THESE ARE STUDIES DONE BY THE
FEDERAL RESERVE BOARD STUDIES
DONE DONE BY DARTMOUTH SO THESE
ARE NOT JUST INDUSTRY STUDIES.
ON AN ISLAND LIKE TO SAY IS THAT
WE LOOK FORWARD TO WORKING WITH
THE AUTHOR AND THE CO AUTHOR ON
THIS BILL -- BUT THERE IS NO
RESPONSE. TO WHAT HAPPENS
INDIVIDUALS THAT -- WILL NOT BE
ABLE TO GET HER ALONE BECAUSE
THERE ARE A LOWER CREDIT RISK.
SO WITH THAT I THANK YOU.
THINK ABOUT I'M VICE CHAIRMAN
CHEN MEMBERS OF THE COMMITTEE
THANK YOU FOR LETTING ME ADDRESS
YOU TODAY AN IMPORTANT TOPIC HI
MELISSA SOBRE WITH CAROL
FINANCIAL TECHNOLOGIES WE HAVE
THIRTY SIX STORES HERE OPERATING
A SPEEDY CASH WE OPERATE ONLINE.
WE DO OFFER ALL THREE CONSUMER
LOAN PRODUCTS PAYDAY LOANS AUTO
TITLE LOANS AN UNSECURED
INSTALLMENT LOANS.
I WANT TO TAKE MY BRIEF TIME
TODAY TO ADDRESS -- FOR ITEMS
FROM THE FACT SHEET THAT WAS
DISTRIBUTED BY THE AUTHOR.
THE FIRST ONE I'M GOING TO
ADDRESS IS THE THE QUOTE OF THE
STATUS QUO IS NOT WORKING AND I
CAN'T.
AGREE MORE WITH THAT QUOTE --
I'VE DISTRIBUTED THIS SHEET HERE
THESE ARE THE CONSUMER LOAN
PRODUCTS AVAILABLE TO NON PRIME
CONSUMERS IN CALIFORNIA THIS IS
THE TWO THOUSAND SEVENTEEN
VOLUME FROM THE DB O. REPORTS.
YOU'LL SEE ON THE LEFT SIDE TWO
POINT NINE BILLION IN PAYDAY
LOANS ON THE RIGHT SIDE TWO
POINT SIX BILLION IN OVER TWENTY
FIVE HUNDRED LOANS.
AND YOU'LL SEE THAT GAP IN THE
MIDDLE WITH ABOUT THREE HUNDRED
AND SIXTY SEVEN THOUSAND R. SIT
THREE SORRY THREE HUNDRED SIXTY
SEVEN MILLION LOANS BETWEEN --
ZERO TWENTY FIVE HUNDRED UNDER
THE CFL KIND OF THAT GAP IN THE
MIDDLE.
SO THAT THAT LENDING IN THE
MIDDLE REPRESENTS 6% OF THIS
ENTIRE VOLUME.
IN WHAT NON PRIME CONSUMERS
REALLY NEED.
IS ALONE IN THE MIDDLE BUT
SOMEWHERE BETWEEN TWO FIFTY FIVE
AND TWENTY FIVE HUNDRED IF YOU
LOOK AT CLARITY'S NON PRIME ONE
A ONE STUDY.
THE AVERAGE UNSECURED
INSTALLMENT LOAN ACROSS THE US
IS FOURTEEN HUNDRED AND FORTY
DOLLARS.
IF YOU LOOK AT DATA FROM ONE OF
OUR LARGEST LEGIONS THEM THE
AVERAGE AMOUNT OF CREDIT THAT
CONSUMERS IN CALIFORNIA GOING
ONLINE LOOKING FOR IS JUST OVER.
NINE HUNDRED THESE NON PRIME
CONSUMERS NEED SOMETHING IN THE
MIDDLE IN CALIFORNIA IS.
UNUSUAL RIGHT NOW WHERE THEY
THEIR CHOICES MOST OFTEN ARE TWO
FIFTY FIVE OR OVER TWENTY FIVE
HUNDRED SAID THE STATUS QUO IS
NOT WORKING I AGREE WITH THAT.
IN IN THIS MIDDLE -- TWO THIRDS
OF THAT LENDING IS BEING DONE BY
PILOT PROGRAM LANDERS I THINK
PILOT PROGRAMS LOANS ARE
TERRIFIC SOLUTION FOR A SMALL
SUBSECTION OF NON PRIME
CONSUMERS.
IN AFTER SEVEN YEARS OF PILOT
PROGRAM LOANS YOU KNOW THE DATA
DEMONSTRATES THAT THEY JUST
CAN'T SERVE KIND OF THE BROADER --
NON PRIME CONSUMER SEGMENT THERE.
EVEN WITH A PILOT PROGRAM
LENDERS WITH THE ABILITY TO GET
UP 259% APR.
THE SECOND THING ON THE FACT
SHEET I WANT TO ADDRESS IS.
THIS COMPROMISE REFLECTS THE
HIGHER COSTS FOR LENDERS TO
OPERATE IN CALIFORNIA.
I'M LOST ON THAT -- ONE LAST
YEAR'S BILL WAS 36% A PR THIS
BILL IS 36% PLUS THE FEDERAL
FUNDS RATE WHICH IS ABOUT TWO
TWO AND A HALF PERCENT SO THAT'S
THIRTY EIGHT AND A HALF PERCENT.
SO LEMME JUST STATE FOR THE
RECORD WE CANNOT SERVE OUR
CURRENT CUSTOMERS AT THIRTY
EIGHT AND A HALF PERCENT OR EVEN
AT 59% WHICH IS UNDER THE PILOT
PROGRAM LOANS LOANS AS HIGH AS
YOU CAN GET IT.
RIGHT SIX MINUTES IF WE COULD --
YES CLOSE.
OKAY -- SO I SEE LENDERS SUCH AS
ONE MAN LANDMARK SUPPORTING THIS
BILL IT'S EASY TO COMPARE MY
COMPANY BETWEEN MY COMPANY IN
ONE MAIN BECAUSE WE'RE BOTH --
PUBLIC COMPANIES THEY REPORT
THAT THEIR AVERAGE LOAN SIDE FOR
UNSECURED INSTALLMENT IS.
SEVEN THOUSAND THAT THEIR
AVERAGE CUSTOMER FICUS SCORE SIX
THIRTY FIVE THAT THE RABBITS
TERMS FIFTY THREE MONTHS THAT'S
FOUR AND A HALF YEARS -- OUR
AVERAGE IQ SCORE SIX HUNDRED
THAT'S THIRTY FIVE PERCENTAGE
POINTS OF THE DIFFERENT -- OUR
AVERAGE LOAN IS UNDER THREE
THOUSAND VERY DIFFERENT CUSTOMER
VERY DIFFERENT PRODUCT. ONE OF
THE ADDRESS ONE MORE OF THE FACT
SHEET ITEMS AND THAT'S A TWENTY
SIX HUNDRED DOLLAR LOAN OVER
FORTY TWO MONTHS IS A TOTAL
PAYMENT OF TWELVE THOUSAND SIX
HUNDRED AND EIGHTY FIVE THAT'S
VERY CLOSE TO WHAT OUR LOAN IS
OUR LOAN IS FORTY TWO MONTHS.
AT 132% APR -- I WILL TELL YOU
WHEN I WAS WITH ASSEMBLY MEMBER
GRAYSON LAST MONTH I SHARED WITH
HIM THAT ARE IN OUR TO OF ALL OF
OUR LOANS ORIGINATED IN.
TWO THOUSAND FOURTEEN ABOUT 1%
WENT TO THE FULL CONTRACT TERM
IN THE AVERAGE TERM WAS ACTUALLY
LESS THAN A YEAR.
IN PREPARATION FOR TESTIMONY
TODAY I WENT BACK AND PULLED UP
ALL OF OUR TWO THOUSAND FIFTEEN
LOANS.
AND AGAIN AVERAGE LOAN WAS JUST
OVER TWENTY SIX HUNDRED AVERAGE
PAY BACK WAS FORTY SIX HUNDRED
AVERAGE TERM WAS LESS THAN A
YEAR.
AND ONLY POINT 7% WENT THE FULL
CONTRACT TERM OUR CUSTOMERS ARE
USING THESE LOANS FOR THE PLAYER
TO FOR NINE BUCKS A MONTH THEM.
SO I BELIEVE THAT THE COMMITTEE
WANTS TO REFER IMPROVE THE
MARKET PLACE FOR NON PRIME
CONSUMERS WHAT'S REALLY
IMPORTANT IS THREE THINGS THAT
WHAT OPTIONS DO NON PRIME
CONSUMERS SUB SIX THIRTY FIVE
THAT ONE MAIN INLAND MARKER
SERVING WHAT DID OPTIONS TO THEY
REALLY HAVE.
HOW THE USING THOSE HIGH COST
LOANS THAT THEY'RE GETTING TODAY
PLEASE UNDERSTAND THESE BARGER
BEHAVIORS THANK YOU VERY MUCH
FOR TESTIMONY THANK YOU -- WE
HAVE ANY OTHER WITNESSES IN
SUPPORT.
OPPOSITE I'MSORRY AND
OPPOSITION I APOLOGIZE.
IN OPPOSITION -- NAME AND
AFFILIATION PLEASE.
GOOD AFTERNOON MOUNTING PLATE AS
WITH CAN TANA WHAT DEPARTMENT ON
BEHALF OF THE UPPER LAKE TRIBE
ARE OPPOSE UNLESS AMENDED
POSITION HINGES ON THE CODIFYING
OF TRIBAL SOVEREIGNTY AS WELL AS
CLARIFYING THAT.
A LEGITIMATE TRIBAL ENDING
BUSINESS MAY CONTINUE TO OPERATE
WITH CALIFORNIA LICENSE FEES
THANKS.
SHE CAN AND SHE TERM A PRIVATE
CITIZEN CITIZEN AND I OPPOSE
THIS BILL.
I'M NEEDING ON TOMORROW'S I'M A
STATE WORKER I LIVED THROUGH --
ARNOLD SCHWARZENEGGER'S
FURLOUGHS OF 15% LOSS OF INCOME.
I HAD TO ARM.
SORRY.
I TO FILE BANKRUPTCY.
AND AFTER THAT THERE WAS NO HELP
FROM CREDIT UNIONS CREDIT CARD
COMPANIES FINANCE COMPANIES OF
COURSE FAMILIES IN THE SAME
SITUATION AS I WENT.
I WAS THANKFUL I FOUND RICE AND
NOW I'M BACK ON THE ROAD TO
RECOVERY AND I DID PAYING MY
FIRST LOAN.
I REFINANCED.
I PAY THAT I COMPLETELY AND I RE
LOAN.
SO THERE ARE LENDERS OUT THERE
THAT REALLY HELPED MEMBERS LIKE
MYSELF AND HELP US IMPROVE OUR
CREDIT RATING THANK YOU.
JESSA NAME AFFILIATION POSITION
PLACE.
MARIA VALUE OF A PRIVATE CITIZEN
I STRONGLY OPPOSE THE BILL.
MARCUS ALLEN PRIVATE CITIZEN AND
I ALSO CLOSE ABOUT.
KELLEY BLUE PRIVATE CITIZEN I
STRONGLY OPPOSE THE BILL.
HELLO WOLF PRIVATE SYSTEM I
OPPOSE THE BILL.
PATRICIA MCBRIDE PRIVATE CITIZEN
I OPPOSE THE BILL.
PHYLLIS BANKS PRIVATE CITIZEN
AND I OPPOSE THE BILL.
CANASTA LOGO WHICH CHECK INTO
CASH AND WEEP.
RACHEL SCHREIBER WITH TITLE MAX
IN OPPOSITION.
GOOD AFTERNOON MISTER CHAIR JUST
DEPENDS ON BEHALF OF WALMART
UNFORTUNATELY IN OPPOSITION.
MARGARET GLAD STAND BEHALF OF
ADVANCE AMERICAN OPPOSITION.
TOM WINNER CALIFORNIA FINANCIAL
SERVICE PROVIDERS OPPOSE.
DAVID CANTON WITH ONLINE LENDERS
ALLIANCE IN OPPOSITION.
DO WE HAVE ANY OTHER WITNESSES
IN OPPOSITION.
I'M.
A WOULD LIKE TO FOR YOU A
COURTESY AND I KNOW YOU HAD A
CHANCE TO SPEAK BUT IF WE COULD
KEEP IT BRIEF THAT'S OKAY --
THANK YOU OF OF VICE CHAIR CHEN
APPRECIATE THAT I MERRY JACKSON
WITH THE ONLINE LENDERS ALLIANCE
WE ARE THE FIRST FINTECH TRADE
ASSOCIATION AND WE REPRESENT.
AS WELL AS CREDIT BUREAUS AND
LEE PROVIDERS AS WELL AS
SOFTWARE ENGINEERS PEOPLE THAT
REALLY HELPED DEVELOP THE
ECOSYSTEM FOR ONLINE LANDING.
AND THE ONLY THING I'D REALLY
LIKE TO ADD HERE IS 36% A PR IS
JUST NOT A WORKABLE NUMBER TO
COVER THE COST OF LANDING.
SO 3% A MONTH IS THE IT SAYS
EVEN THOUGH IT SOUNDS GENEROUS
IT REALLY ISN'T -- I USED TO BE
ONE OF THESE CONSUMERS AND LIKE
THE PERSON WHO JUST GOT UP HERE
TELL A STORY -- ONCE YOU'RE
UPSIDE DOWN FINANCIALLY HE NEEDS
SOMEONE TO TAKE A CHANCE ON YOU
AND I WAS ABLE TO FIND THAT WITH
A LENDER WHEN I WAS A WORKING
MOTHER WITH TWO CHILDREN AND I
HAVE TO SAY WITHOUT THAT ACCESS
TO CREDIT I WOULDN'T BE HERE
TODAY.
SO -- IT IS IMPORTANT TO YOU
HAVE A CONSUMER PROTECTION BUT I
ALSO BELIEVE THAT WE HAVE TO BE
REALISTIC AND WHAT IT TAKES TO
SERVE THIS CUSTOMER.
AND 3% A MONTH JUST DOESN'T WORK
THANK YOU FOR YOUR TIME.
THANK YOU VERY MUCH SEEING NO
OTHER WITNESSES OPPOSITION ON
COMMITTEE MEMBERS HAVE ANY
QUESTIONS.
THANK YOU ALL FOR YOUR TESTIMONY
TODAY I AM A LOT OF WHAT I'M
HEARING IS THAT THERE'S A DEBATE
ABOUT WHAT THIS WILL DO IN THE
MARKET. TO ACCESS TO CAPITAL BUT
WE'RE FORTUNATE TO HAVE THIRTY
EIGHT STATES THE DISTRICT OF
COLUMBIA THE ONE BEFORE US AND
SO I'M CURIOUS TO HEAR FROM BOTH
SIDES WHAT HAS HAPPENED WE HEARD.
TOUCH ON WHAT HAPPENED ORGAN BUT
I'D LIKE TO KNOW MORE ABOUT WHAT
IS HAPPENED TO ACCESS TO CAPITAL
IN AS OTHER STATES.
SO 80% SO LET'S BE CLEAR THIS
THIS BILL -- LOOKS AT ONE
PRODUCT AND THERE ARE MULTIPLE
MORE PRODUCTS ON THE MARKET
RIGHT AND SO THIS IS REALLY FROM
250-021-0000 AND AS YOU WILL SEE
IN THE INFORMATION YOU HAVE 80%
OF THE UNITED STATES LIVES WITH
A CAP.
ON THAT AND IT THERE CONTINUE TO
BE OTHER OPTIONS I FEEL ONE OF
THE THINGS THAT'S IMPORTANT TO
KNOW IS THAT THE REASON THAT WE
HAVE SOME OF THE MORE
RESPONSIBLE LENDERS.
AS SUPPORTIVE OF THIS BILL IS
BECAUSE THEY WILL STAY IN
BUSINESS -- EIGHT INCLUSIVE WE
WE'VE HAD AN ASSEMBLY DELEGATION
THAT WAS HERE THAT WENT OUT TO
WASHINGTON DC -- THAT ALSO SAYS
THAT ONE OF THE THINGS THAT
NATION WIDE AT IS BEING LOOKED
AT AND FOR CALIFORNIA IS
REGULATORY STABILITY KNOWING
THAT THIS IS BEEN A DISCUSSION
FOR FOURTEEN YEARS IN THE STATE --
AND SO PEOPLE ARE HESITANT AND
SHY TO INVEST IN THE STATE OF
CALIFORNIA UNTIL THEY KNOW WHAT
THE RULES WILL BE -- WE HAVE A
UNANIMOUS CALIFORNIA SUPREME
COURT DECISION AS HAS BEEN
NOTICED THAT CALLED THESE RAZA
LOANS UNCONSCIONABLE.
AND MEANING THEY DIDN'T QUITE
KNOW WHAT THE RATE WOULD BE --
WHAT THE RIGHT RATE WOULD BE BUT
THE RATE THAT IS IN EXISTENCE
AND THE COMPANY THAT WAS
MENTIONED IN THAT COURT CASE --
HAD PRETTY HIGH.
NUMBERS AND THEY WERE WELL INTO
THE HIGH INTEREST AND SO I THINK
WHAT WHAT'S BEING CALLED UPON US
AS A STATE IS ONE TO TO DO
SOMETHING OTHERWISE THE COURTS
WILL DO SOMETHING OR IT WILL BE
DONE THROUGH A BALLOT INITIATIVE --
WE'VE LOOKED AT WHAT HAS
HAPPENED AGAIN IS IT THROUGH THE
COUNTRY AND THAT 36% COMES FROM
THE MILITARY LANDING ACT WHICH
CREATED A STANDARD.
PEOPLE CAN DEBATE ON WHETHER THE
STANDARD IS THE RIGHT NUMBER OR
NOT BUT NONE THE LESS IT'S
TREATED THE STANDARD WHICH IS
WHAT WE'RE MOVING FORWARD WITH.
THANK YOU AND YOU KNOW I'M.
I'M GOING TO SUPPORT THE BILL
BECAUSE I THINK WE HAVE
VULNERABLE COMMUNITIES THAT ARE
BEING EXPLOITED AT THE COST OF
US NOT DOING ANYTHING ABOUT
NEEDS TO STOP BUT I AM CONCERNED
ABOUT -- ESPECIALLY THE FINTECH
SPACE CREATING OTHER
OPPORTUNITIES WHERE WE AREN'T
REGULATING AND THAT WHEN PEOPLE
NEED ACCESS TO CAPITAL THEY WILL
TURN TO UNREGULATED MEANS AND
THINGS THAT WILL EXPLOIT THEM
EVEN FURTHER AND SO I THINK AS
WE MOVE FORWARD WITH THIS.
WE NEED TO BE COMMITTED TO
LOOKING AT THOSE ALTERNATIVES IN
ENSURING THE WERE REGULATING
THERE'S AN EQUAL NUMBER MAYOR
PROVIDE MORE CONTACTS.
HELLO.
I'M DR FLAT OKAY QUESTIONNAIRES
BUT WHICH ONE THANK VICE CHAIR
CHEN.
I A REALLY -- APPRECIATE.
NOW AUTHORS -- INTENT.
TO THAT IS OBVIOUSLY TRYING.
TO PROTECT CONSUMERS SO WHO ARE
IN NEED [inaudible]
BUT I HAVE A QUESTION LISTENING
TO OPPOSITION [inaudible]
SIDE [inaudible]
WHEN?
YOU WILL REGULATE THE INTEREST
RATE THE 236% WHICH IS A NOT
WORKABLE THAT'S WHAT THEY ARE
SAYING.
SO THAT MEANS THAT THEY HAVE TO
FORTY THE MEN TO GO ELSEWHERE.
AND THE CONSUMERS.
WE HAVE OUR BORROWED.
AS THE CHART SAYS SO -- MOST.
WHAT IS IT?
WHAT WAS THE NUMBER HERE THIS
HOT NUMBER HOW CAN EVEN RE? ONE
WHERE WE'RE AT WITH A COLD -- IF.
HELLO KERN MENDES AND CANNOT
OPERATE AND THE COST OF THE
BUSINESS.
THANK YOU DOCTOR CHOI FOR THAT
QUESTION -- AS FAR AS WHERE THEY
GO BUT ALSO TO ADDRESS -- THE
THIRTIES THE 36% INTEREST RATE --
CAP.
AND THE THE RESPONSE TO THE 36%
IS THAT WHEN THEY SAY THAT
THEY'RE NOT GOING TO BE ABLE TO
CONTINUE TO DO BUSINESS.
MY QUESTION WOULD BE WHAT WHAT'S
THE CAUSE OF A 36% CAP WHERE
SOME CAN CAN CONTINUE TO DO
BUSINESS BUT THESE PARTICULAR
MODELS CAN'T DO BUSINESS.
AND FROM WHAT I UNDERSTAND IT
WOULD BE THAT -- THERE NEEDS TO
BE COVER FOR THE HIGH RATE OF
DEFAULTS -- HOWEVER THE SAME
COMPANIES ARE SAYING THAT THEY
ARE DOING -- A LEVEL OF
UNDERWRITING.
SO I WOULD I WOULD IMAGINE THAT --
THE MORE DEFAULT YOU HAVE THE
HIGHER THE INTEREST RATE MUST BE
SO THAT THERE CAN BE A RECOVERY
TO KEEP THAT PARTICULAR MODEL
WORKING.
AS AS THE THE CHAIR MENTIONED
THERE ARE A LOT OF PRODUCTS THAT
ARE OUT THERE THIS IS NOT GOING
TO COMPLETELY SHUT DOWN THE
SMALL DOLLAR LENDING BUSINESS
WHAT IT IS GOING TO DO IS BRING
IT TO A PLACE OF A REASONABLE.
MODEL FOR BUSINESS THAT ALLOWS
PEOPLE TO BE ABLE TO TAKE OUT A
LOAN TO BE ABLE TO REPAY IT AND
TO WORK THEMSELVES INTO A PRIME
MARKET AND NOT CONTINUE TO BE IN
A PERPETUAL.
SUBPRIME -- CONDITION AS FAR AS
WHERE THEY WILL GO -- THERE ARE
GOING TO BE I BELIEVE THIS -- I
THINK WE COULD LEARN AS THE
EXAMPLE WAS MENTIONED -- BY
OPPOSITION ABOUT AN EXAMPLE IN
OREGON.
AND I THINK THE THE STATE THAT
WE HAVE -- ASSEMBLY MEMBER --
REBEKAH BAUER CON I BELIEVE THE
THE STATE THAT WE HAVE IS
INNOVATIVE AND CREATIVE ENOUGH
THAT WE CAN ACTUALLY LEARN
LESSONS FROM OTHER STATES THAT
HAVE GONE BEFORE US.
BAND THROUGH TECHNOLOGY AND
THROUGH -- THROUGH BETTER
ENFORCEMENT WE CAN ACTUALLY HOPE
NOT REPEAT THOSE SAME MISTAKES
AS FAR AS THEY WHERE WOULD THEY
GO I BELIEVE THEY'LL BE PRODUCTS
THAT.
BECAUSE OF THE CERTAINTY THAT'S
PER I DID IN THE STATE OF
CALIFORNIA FROM A. B. A FIGHTER
I BELIEVE THIS THAT THERE WILL
ACTUALLY BE PRODUCTS THAT
ACTUALLY RISE FROM THIS. FOR A
MORE OPTIONS FOR PEOPLE TO BE
ABLE TO CHOOSE FROM.
AS A FOLLOW UP QUIRK QUESTION
YOU A BAILOUT.
FIVE THIRTY NINE IS -- LIMITING
THE RATE 236%.
YOU ARE NOT REGULATING AS I READ
THE THE CREDIT RATING -- CREDIT
INSURANCE.
IF AND WHEN THEY TRY -- TO MAKE
UP THE DIFFERENCE Y. LOS.
I CREDIT INSURANCE.
DO YOU MAY NOT -- ACHIEVED WELL
WHAT YOU ARE TRYING TO ACHIEVE A
THROUGH THIS BILL.
I'M SORRY WHAT'S THE QUESTION
YOU'RE ASKING THE THE CREDIT
INSURANCE AND THEY MAY THEY MAY
CHARGE.
IN ADDITION TO THE INTEREST RATE
AND THE QUESTION IS.
WHEN WHAT ABOUT THE QUESTION
WHAT WHAT ABOUT THE CREDIT
INSURANCE?
WHAT WOULD THAT THAT IS A NOT
REGULATING REGULATED BY DISPEL
AND THAT THEY CAN CHARGE
INJURIES ON TOP OF THAT MAYBE
MAYBE -- OPPOSITION NOW CAN
ANSWER -- TO THAT.
ACTUALLY THERE IS A LOT OF
EXCUSE NATURE THERE IS A LOT A
LOT OF REGULATION ON THAT AND BY
THE WAY IT'S ACTUALLY AGAINST
THE LAW -- TO OFFER ALONE AND
THEN REQUIRE THERE HAD TO BE
ANOTHER PRODUCT THAT WOULD BE
ADDED ON TO IT.
SO IT'S AN OPTION NUMBER ONE AND
THEN NUMBER TWO THERE ARE --
THERE ARE RATE REGULATIONS THAT
IF I UNDERSTAND CORRECTLY ON THE
INSURANCE PRODUCT ITSELF.
SO THAT IF I UNDERSTAND IT
CORRECTLY.
IT WOULD RAISE THE INTEREST RATE --
IF YOU WERE INCLUDING THE ADD ON
OR INSURANCE BUT IT WOULD NOT
EVEN COME REMOTELY CLOSE TO
WHAT'S BEING OFFERED UP THERE
NOW IN THE TRIPLE TRIPLE DIGIT.
OKAY VICE CHAIR CAN I ASK
OPPOSITION NANA.
I HAVE A QUESTION IF WITH 36% IS
AND NOT WORKABLE AND NOT BY
ABOUT A WEEK.
HAVE YOU.
A SUGGESTED THE AS A COMPROMISE
TO RATE THAT WHAT WILL BE A ON
THE SIDE OF A PROTECTING THE
CONSUMERS HAVE BUT THIS IS YOUR
BUSINESS CAN OPERATE THAT WAS
THE ANY COMPROMISE DEVOTION WHAT
INTEREST RATE THAT YOU HAVE
PROPOSED.
ACTUALLY ASSEMBLY MEMBER CHOI
THERE'S BEEN NO DISCUSSION
AROUND THAT.
SO IF YOU LOOK AT THE DPO DATA
THERE IS ONE POINT FOUR BILLION
IN LOANS BEING DONE OVER 40% APR.
AND WE WILL TALK WHEN WE TALK
ABOUT THE OTHER LENDERS THAT CAN
OPERATE AT 36% ARE UNDER THE
LENDER SUCH AS ONE MAN AND ONE
MARK THAT ARE SUPPORTING THIS
BILL WE'RE TALKING ABOUT APPLES
AND ORANGES SO FIRST OF ALL.
THAT ONE POINT FOUR BILLION IN
LOAN VOLUME THAT'S BEING DONE --
OVER 40% APR.
THEY CAN THEY CAN BE DOING THAT
LOAN VOLUME TODAY IF THEY WANTED
TO AND WE WOULD BE OUT OF
BUSINESS.
BUT THEIR PRODUCT IN THERE
CONSUMER IS IN THEIR BUSINESS
MODEL ISVERY DIFFERENT FROM
OURS SO TO THINK THAT IF WE'RE
NOT HERE LENDING TO OUR
CUSTOMERS THAT OTHER LENDERS.
CAN STEP IN AND LEAD TO THOSE.
CUSTOMERS THAT ARE DEEPER IN THE
FIGHT GOES SCORE RANGE AT 36% OR
LESS THAT'S JUST NOT GOING TO
HAPPEN [inaudible]
SO WITH.
IF AND WHEN -- THIS PASSES.
WHAT DO YOU?
PREDICT.
WHAT'S GOING TO HAPPEN TO THE
MARKET THE OF HIS CELL.
PHONE FIVE HUNDRED TWO TEN
THOUSAND DOLLAR MARK THAT ONE
POINT FOUR BILLION IN LOAN
VOLUME TODAY THAT'S BEEN DONE AT
OVER 40% APR FIRST THOSE SUB
PRIME.
NAM CONSUMERS IT THEY'RE NOT
GOING TO BE PICKED UP BY OTHER
STATE LICENSED LENDERS THEY'RE
GOING TO BE PICKED UP BY --
TRIBAL LENDERS WHICH IS A VALID
MODEL BUT THEY HAVE THEIR OWN
SOVEREIGN NATION -- OR THEY'RE
GOING TO GO TO OFF SHORE ILLEGAL
LENDERS. FOR THE USE OVERDRAFT
OR THEY'RE GONNA YES THERE'S A A
NUMBER OF SUBSTITUTE THINGS THAT
COULD BE MORE EXPENSIVE THAN
MOST ARE MORE EXPENSIVE.
THANK YOU VITAL KERR AS A MATTER
OF JUST A POINT OF CLARIFICATION
I'D LIKE TO ACTUALLY ASK SOME OF
THE SUPPORT TO ALSO JOIN US AT
THE TABLE SINCE RATE THE
DISCUSSION NOW SO WOMEN.
HAVE.
ASSEMBLYMEMBER GABRIEL.
AND I DON'T KNOW WHICH OF YOU
WOULD LIKE FOR GONNA NEED.
YEAH IT'S GOT.
WE'RE GONNA NEED ONE OF YOU TO
TRANSITION SO WE CAN HAVE US
SUPPORT AT THE TABLE AS WELL
[inaudible]
AUTONOMOUS STATUS.
THANK YOU MISTER VICE STRIVE TO
QUESTIONS WITH YOUR PERMISSION
ONE TO THE OPPOSITION AND WENT
TO THE AUTHORS OF THE BILL SO.
I'M JUST TO PICK UP FROM MY
COLLEAGUE FROM THE EAST BAY I
THINK SHASTA NECK SOME QUESTION
AND YOU KNOW WE'RE WE'RE LOOKING
AT THIS INFORMATION WE CAN SEE
THAT THIS IS ACTUALLY NOT AN
ERROR IN WHICH CALIFORNIA'S
LEADING THAT THAT A NUMBER OF
OTHER STATES HAVE GONE BEFORE.
US AND HAVE -- ENACTED.
SIMILAR OR IN FACT MORE
STRINGENT REGULATIONS IT SO I'M
JUST CURIOUS WHY IT -- FROM YOUR
PERSPECTIVE WE HAVE SEEN HAPPEN
IN THIS OTHER STATES WE'VE HEARD
A LOT OF TESTIMONY ABOUT LENDERS
EXITING THE MARKET ABOUT A LACK
OF ACCESS TO CAPITAL FOR CERTAIN
FOLKS.
IS THAT TO ME THAT WE'VE SEEN IN
IN THOSE OTHER STATES AND IF SO
CAN YOU DESCRIBE THAT IN SOME
DETAIL ABSOLUTELY.
SO I HAVE A CHART WHICH I
PROVIDED TO EACH ONE OF YOUR
CHIEFS OF STAFF -- PART OF THIS
HEARING I'LL JUST GO DOWN THE
LIST HERE -- SO YOU HAVE THE
ECONOMIC EFFECT OF STORES
CLOSING STOREFRONTS CLOSING IN
ARIZONA -- IN TWO THOUSAND SEVEN
APPROXIMATELY SEVEN HUNDRED
FIFTY STOREFRONT LOCATIONS
OFFERING THIS IS PAY DAY LOANS --
THAT CLOSED -- WITH REGARD TO
OREGON IN TWO THOUSAND AND SEVEN
IT EXTENDED THAT 36% RATE CAPS.
TO CAR TITLE LENDERS AND
INTERNET LENDERS OF CONSUMER
COMPLAINTS.
AGAINST UNREGULATED INTERNET
LENDERS DOUBLED AND NEARLY 70%
OF SUCH COMPLAINTS FILED IN
TWENTY TEN WERE AGAINST
UNREGULATED ONLINE LENDERS NOW --
I ALSO HAVE SPECIFIC STUDIES
THAT ARE ATTACHED TO THAT SO
THAT WE CAN JUST MAKE THIS UP A
JUST SO YOU KNOW -- AND HAPPY DO
AGAIN ALREADY HAVE SHARED WITH
YOU CHOOSE -- WHICH IS THIS
CHART RIGHT HERE OKAY THAT WE
PUT TOGETHER I WAS VERY
METICULOUS ABOUT MAKING SURE
THAT OUR FAX RECORD -- IN SOUTH
DAKOTA -- IT STATES THAT MOST
CONSUMERS TURN TO ONLINE.
UNREGULATED LENDERS.
THAT WAS IN.
TWENTY SIXTEEN I CAN GO ON SOME
OF SEE HERE.
WHEN THE GOES BACK TO NINETEEN
NINETY SEVEN THE FEDERAL RESERVE
BANK?
STUDY.
THAT WAS DONE THE SAID -- PEOPLE
BOUNCE MORE CHECKS COMPLAIN MORE
ABOUT LENDERS AND DEBT
COLLECTORS IN A FILE CHAPTER
SEVEN BANKRUPTCY AT A HIGHER
RATE -- AND I'LL DO ONE LAST ONE
WHICH WAS IN GEORGIA -- IN TWO
THOUSAND AND FOUR IT'S A FEDERAL
RESERVE BANK OF NEW YORK STUDY
REPORTS THAT PEOPLE THE HOUSE
MORE CHECKS COMPLAIN MORE ABOUT --
ONLINE LENDERS AND DEBT
COLLECTORS SO DEBT COLLECTORS
DEFINITELY AN ISSUE.
THANK YOU I I APOLOGIZE I DON'T
I HAVEN'T SEEN THE TURN IF THEY
THINK A NUMBER OF FOLKS --
HAVEN'T SEEN AS WELL OKAY BUT I
DID SEND IT JUST SO YOU KNOW
OKAY I'VE I'VE I'M I'M SURE THAT
THAT'S TRUE -- I GUESS WE'LL
JUST A FALL QUESTION WHAT DO WE
KNOW IT DID THE TOTAL.
VOLUME OF LANDING DECREASE OUR
FOLKS -- SUBSTITUTING TO OTHER
PRODUCTS OR DO WE HAVE ANY
EVIDENCE TO MOUNT THE
SUBSTITUTING OTHER PRODUCT OKAY
DO HAVE A SENSE OF WHAT THE
NATURE OF THOSE PRODUCTS WERE.
PRETTY MUCH -- ONLINE AND
UNREGULATED INTERNET LENDERS GOT
IT OKAY.
WAS IS THERE A STUDY OF FOR THAT
RESULTS AS THOSE THAT GET IT I
MEAN THAT THEY WENT TO
UNREGULATED -- LOANS AND
INDUSTRY. FOR THAT.
BUT I JUST DIDN'T KNOW IF WE HAD
DATA TO SHOW THAT THE TRANSITION
FROM SMALL DOLLAR LENDING TO
UNREGULATED.
LENDING TWO WEEKS.
THERE THERE ARE STUDIES FROM
DIFFERENT STATES THAT TALK ABOUT
THE IMPACTS TO CONSUMERS AFTER.
OF RESTRICTIVE RATE CAPS IN.
YOU MAY NOT HAVE -- CURIOSITY TO
DO THIS FOR SOME TIME BUT IT'S
NOT GOOGLE A SMALL DOLLAR LOAN
OR PAYDAY LOAN IN NEW YORK AND
SEE HOW MANY.
LENDERS YOU HAVE COME UP ON YOUR
SEARCH HAD VERY HIGH RATES.
THEY'RE THERE AND THEY'RE OVER
25% A PR.
MEMBERS I THINK IT'S REALLY
IMPORTANT ALSO TO ADD JUST
QUOTING WHAT WAS JUST SAID AB IT
WAS DESCRIBED AS PAYDAY LENDING
THIS IS A THAT'S ONE OF THE
PRODUCTS THIS BILL DOES NOT DEAL
WITH PAYDAY LENDING.
THIS IS SMALL DOLLAR LANDING
250-021-0000 PAYDAY LENDING IS
THREE HUNDRED UNDER SO WE CAN
ACTUALLY COMPARE -- THAT FOR YOU
KNOW APPLES TO APPLES THERE ARE
MULTIPLE PRODUCTS AND SO THIS IS
ONE OF THE PRODUCTS AND THE
THREE HUNDRED UNDER.
IS NOT BEING IMPACTED BY THIS
BILL AND THAT IS PAID A THANK
YOU THINK THINK YOU'RE MUCH OF
JUST BECAUSE SOME MEMBERS I I'M
JUST ASKING QUESTIONS I DON'T
NOW -- YOU KNOW I HAVEN'T SEEN
ANY OF THIS INFORMATION I THINK
IT'S I THINK IT'S IMPORTANT
RELEVANT OUR CONVERSATION TO SEE
WHAT THE EXPERIENCE OF OTHER.
OF OTHER STATES HAS BEEN -- JUST
A QUESTION FOR THE AUTHORS I I
AGREE A 100% WITH OUR CHAIR THAT --
YOU KNOW WE HAVE THIS WE HAVEN'T
I THINK AN OBLIGATION TO PROVIDE
SOME CERTAINTY TO THE MARKET --
AND TO SHOW YOU KNOW TRYING TO
PROMOTE REGULATORY CERTAINTY SO
FOLKS CAN INVESTORS I'M JUST
CURIOUS -- AS WE'RE THINKING
ABOUT SETTING THAT NUMBER WHAT.
WHAT WAS THE IMPETUS BEHIND 36%
SO THIRTY SIX IS BASED ON THE
MILITARY LENDING ACT IT'S ON A
STANDARD A THINK THERE COULD BE
A LOT OF DEBATE ON WHETHER
THAT'S THE RIGHT NUMBER OR NOT
BUT IT CREATED A STANDARD FOR
THE UNITED STATES?
AND WHAT THE MILITARY LENDING
ACT DOES IT ALLOWS ACTIVE
MEMBERS OF OUR MILITARY TO GET A
LOAN AT 36% IN AN EMERGENCY IN A
TIME OF NEED AND SO WHAT WE'D
LIKE TO DO IS EXTEND THAT.
AND IT IS TRUE THAT THIS IS 36%
PLUS THE FEDERAL FEE WHICH WILL
CHANGE SLIGHTLY DEPENDING ON THE
ECONOMY PLUS THE SEVENTY FIVE
DOLLAR APPLICATION FEE.
AND AS IT'S BEEN NOTED THERE
COULD BE INSURANCE BUT THAT THE
LAW IS VERY CLEAR THAT IT IS A
LEGAL FOR LENDER TO MAKE A LOAN
THAT IS CONTINGENT UPON A BAR
ACCEPTING ANY KIND OF SEPARATE
PRODUCT.
THERE IS ALREADY A LAW IN PLACE
FOR THAT SO IF PEOPLE ARE
CONCERNED ABOUT THAT -- WE I
THINK LAST YEAR I MEAN FIRST THE
LEGISLATURE'S BEEN TRYING TO
REGULATE THE SPACE FOR FOURTEEN
YEARS THERE'S A FEW ELEMENTS
THAT HAVE CHANGE FOR OUR STATE
ONE WE HAVE A CALIFORNIA SUPREME
COURT DECISION.
ON THAT TO US WAS CALLED LAST
YEAR THAT SAID THAT THESE RATES
ARE UNCONSCIONABLE.
IT DIDN'T KNOW WHAT THE NUMBER
WHERE WE ALSO CAN LOOK EVEN
RIGHT NOW AT THIS MOMENT THAT
WHEN.
THE LEGISLATURE FAILS TO ACT THE
G. JUST SYSTEM WILL STEP IN AND
WILL CREATE A LOAN FROM TALKING
TO AVERAGE FOLKS -- ON ANY SIDE
OF THE AISLE 36% STILL SOUNDS
HIGH TO SOME FOLKS -- AND SO
WHAT WE KNOW IS THAT YOUR
AVERAGE INDIVIDUAL WILL THINK
818228% IS SOMETHING MORE IN
LINE.
BECAUSE WE FEEL THAT IS STILL
IMPORTANT TO PROVIDE SOME OPTION
TO PEOPLE IN AN EMERGENCY CRISIS
WE CAME UP WITH THIS NEGOTIATED
PRODUCT WHAT YOU SAW LAST YEAR
WAS A BILL THAT WAS SIMILAR BUT
NOT IDENTICAL.
I'M AND FOR US YOU KNOW ONE OF
THE VERY FIRST THINGS I DID WHEN
I CAME INTO THIS ROLE AND AND
LOOKED AT THE SPACES ASKED -- AS
THEY THINK WAS WAS ASKED BY
DOCTOR CHOI AND THERE WAS NO
ANSWER GIVEN WHICH WAS WHAT
WOULD BE THE MAGIC PERCENTAGE.
AND IT WAS CLEAR THAT NO ONE HAD
A MAGIC PERCENTAGE AND THEREFORE
THESE HIGH INTEREST -- TO THAT
WOULD BE PERPETUATED OUR
CONSUMERS IN CALIFORNIA AND
REALLY AROUND THE COUNTRY FEEL
THAT THESE ARE NOT ACCEPTABLE --
WE HAVE USURY LAWS IN THIS
COUNTRY FOR A REASON -- WE DON'T
LIKE IT WHEN CREDIT CARDS ARE
OVER EIGHTEEN OR 28% WELL THIS
IS A PRODUCT THAT AGAIN.
I HAVE PEOPLE INCLUDING CONSUMER
GROUPS WHO WOULD LIKE US TO PUSH
MORE AND TO GO FURTHER WHO THINK
36% PLUS THE FEDERAL FEE IS TOO
HIGH.
AND YOU'RE RIGHT WE HAVE MEMBERS
OF INDUSTRY THAT THINK 36% IS
NEVER GOING TO ALLOW THEM TO GET
THEM THERE.
THIS IS WHAT THE LEGISLATURE
DOES WE TRIED TO FIND A PLACE
AND THERE ARE PEOPLE ON BOTH
SIDES WHO FEEL THIS IS NOT THE
IDEAL AN IDENTICAL PLACE BUT
THIS IS WHERE WE'VE LANDED AFTER
MONTHS.
OF CONVERSATIONS MONTHS OF
CONVERSATION SIXTEEN MONTHS
SINCE JANUARY SINCE I BECAME THE
OFFICIAL CHAIR OF CONVERSATIONS
WITH ALL FOLKS ABOUT THIS -- AND
YOU KNOW IT'S IT'S IT'S NOT VERY
GREAT THAT WE CAN'T YOU KNOW IT
DOESN'T FEEL GREAT THAT ALL
SIDES CAN'T COME TO THIS BUT
THIS IS SOMETHING WHERE WE'VE
LANDED AFTER A LOT OF
CONVERSATIONS -- AND CERES
COMPROMISE AND NEGOTIATION AND
WE THINK THAT THIS IS WHERE OUR
STATE SHOULD MOVE FORWARD
[inaudible]
WHETHER.
NOW I WANT -- TO THANK THE
AUTHOR FOR BRINGING THIS FORWARD
I KNOW THIS IS BEEN A QUITE A
JOURNEY IN IT I THINK I MAY HAVE.
BEEN ON THIS COMMITTEE LONGER
THAN ANYONE -- IS THAT THE LAST
SIX YEARS.
AND IS MY SEVENTH YEAR ON THIS
COMMITTEE.
WE HAVE WRESTLED WITH THIS ISSUE
FOR THE ENTIRE TIME I HAVE BEEN
ON THIS COMMITTEE.
IT IS NOT AN EASY ISSUE AND
ESPECIALLY WHEN I KNOW THE WE'RE
DEALING WITH -- COMMUNITIES OF
CHALLENGE OF WHO HAVE DIFFICULTY.
LIVES IN MOVING FORWARD.
AND THAT HAVE SOMETIMES ENTERED
INTO THESE RELATIONSHIPS WITH
VARIOUS COMPANIES AND THE
UNFORTUNATE THING IS MOST OF THE
TIME WHEN WHEN I GOT WHEN I
FIRST GOT ON COMMITTEE WE HAD A
LOT OF HEARINGS WE HAD PEOPLE
WHO CAME AND TOLD THEIR STORIES.
AND MOST OF THE TIME THERE WERE
STORIES OF HORROR I MEAN THEY
WERE REALLY PEOPLE WHO HAD.
WHO HAD NEEDS BUT AS A RESULT OF
ENGAGING IN THESE KIND OF CREDIT
THE -- ONCE A PREDATORY THESE
LENDING COMPANIES ARE ENDED UP
EVEN IN WORSE CONDITION BECAUSE
OF YOU KNOW THE AMOUNT OF MONEY
THAT THEY WERE.
INVESTING INTO WHETHER IT WAS
THE THIS PARTICULAR LOAN AWARE
THERE WAS A CAR LOANS OR
WHATEVER WE WE DID WALL WITH THE
WAS A PAYDAY.
ALL OF THOSE THINGS AND AND IN
EACH CASE MOST OF THE TIME THEY
ENDED UP IN WORSE PLACES THAT
MADE THEM WHAT WE WOULD LIKE FOR
THEM TO BE.
AND AND I IN A YOU KNOW IT AND
THE FIRST I HAD NO IDEA WHAT WE
WERE TALKING ABOUT UNTIL I BEGAN
TO REALLY EXAMINE -- WHERE WE
ALL ARE AS A STATE IN THIS IN
THIS PARTICULAR SPACE?
AND RECOGNIZE THAT ALMOST ALL OF
THESE PLACES ARE LOCATED IN A
VERY POOR NEIGHBORHOODS AND I
BEGAN TO REALIZE THAT ALMOST
EVERY TIME I LOOKED UP IN THE
COMMUNITY THAT I LIVE AND WORK
IN.
THERE WAS A A PLACE POPPING UP
THAT WAS DOING THESE KINDS OF
LOANS OR WHETHER WAS PAYDAY
LOANS CAR LOANS WHATEVER IT WAS.
AND UP AND AND PEOPLE WERE
SUFFERING AS A RESULT OF THAT
AND AND I THINK WHAT ALSO
HAPPENED WAS.
I BEGAN TO REALIZE THAT AS LONG
AS WE ALLOW THIS TO HAPPEN.
IT SETS THE BEHAVIOR A WITH
REGARDS TO HOW WE LOOK AT ALL
LENDING HOW WE LOOK AT
MANAGEMENT OF OUR RESOURCES AND
NOT THAT THESE FOLKS HAVE A
WEALTH.
BUT THE FACT THAT -- YOU KNOW I
COME FROM A FAMILY OF OF OF
CHALLENGE.
IN YET OUR BECAUSE THESE WERE
AVAILABLE IN THOSE DAYS PEOPLE
HAVE TO FIGURE OUT HOW TO MANAGE
BUT LONG AS WE HAVE PAID A LOANS
OR WHATEVER THEY MAY BE.
PEOPLE GO EVERY OTHER MONTH
LOOKING FOR SOMETHING TO FILL IN
THE GAP AND EVENTUALLY YOU GET
CAUGHT.
BECAUSE YOU'RE GETTING TOO FAR
AWAY FROM WHERE YOU WERE ONCE
WORK.
AND NOW YOU ARE OVERWHELMED BY
THE VARIOUS KINDS OF PRODUCTS
THAT YOU ENGAGED IN.
AND AND IT JUST BRINGS
TREMENDOUS TRAGEDY IN PEOPLE'S
LIVES WE'VE SEEN IT OVER AND
OVER AGAIN SO I I KNOW THIS IS
NOT THE MOST OF THIS IS A
COMFORTABLE PLACE TO BE.
BUT I THINK -- WHEN I THINK OF
CALIFORNIA I ALWAYS THINK OF
THIS PLACE OF?
HOPE OF BEING PROGRESSIVE BEING
MORE CONCERNED ABOUT INDIVIDUALS
YOU KNOW HAVING A SOCIAL SERVICE
PROGRAMS IN PLACE TO KIND OF
BILL FAMILIES AND BILL
INDIVIDUALS.
AND YET WE HAVE BECOME FAR AWAY
FROM THAT PERSPECTIVE I HAD AS A
KID AND COMING TO THE STATE THAT
WE'RE NOW IN IN THAT IN ONE OF
THOSE SPACES THAT I DON'T LIKE
BEING IN.
WHEN I LOOK AT THIS LIST OF
THOSE IN AND AND THE PERCENTAGES
I DON'T LIKE THE FACT THAT
CALIFORNIA IS HANGING DOWN TO
THE BOTTOM WITH VERY LITTLE
REGULATION OR NO REGULATION IN
SO MANY DIFFERENT AREAS?
AND WE'RE AND WE'RE FINDING THAT
PEOPLE ARE POOR THAN BEFORE.
AND WOULD SOMEHOW KNOW THE
DIGGING EVEN DEEPER HOLES OF
POVERTY -- THE FEDERAL
GOVERNMENT HAS THE THE 36% I
MEAN AND AND WE SEE THAT THAT'S
AND AND IS THERE MAINLY BECAUSE
MOST OF OUR MILITARY FAMILIES
WERE WORDS CONSTANTLY GOING IN
GETTING LOANS AND AND THEY
DISCOVERED.
THAT IT WAS HAVING AN ADVERSE
EFFECT ON OUR MILITARY -- WHO
PEOPLE HAVE LIMITED RESOURCES
AND SO THEY THEN STEPPED IN AND
SAID OKAY WE CAN'T ALLOW THIS TO
CONTINUE TO HAPPEN BECAUSE?
YOU KNOW THE KIND OF ACTIVITY
OCCURRING WAS JUST REALLY
DESTROYING THE MORALE OF THE
INDIVIDUALS IT WAS A STRONG A
FINANCES THEIR STABILITY THE
CURE FOR THEIR FAMILIES AND GOES
ON AND ON UNTIL THE GOVERNMENT
STEPPED IN AND SAID OKAY THIS IS
NOT HAPPENING MORE. FOR THE
MILITARY -- IN AT SOME POINT WE
HAVE TO SAY THE SAME THING --
36% IS A LOT.
IT REALLY IS A LIVE IN THOSE OF
US WHO VALUE OUR OUR ECONOMICS
NO THAT'S A THAT'S A HUGE AMOUNT
FOR LOANS YOU KNOW WE WE WE WE
LOOK AT OUR CREDIT CARD AMOUNTS
AND FOLKS OF STARTING
ELIMINATING CREDIT CARDS IN
THEIR LIVES BECAUSE THE
PERCENTAGES SO HIGH -- WE HAD TO
TELL PEOPLE THIS IS WHAT YOU BE
BORROWED MONEY WITH THIS CREDIT
CARD THIS IS WHAT IS GOING TO
COST YOU.
AND IF YOU'RE LIKE MOST OF US
WHO JUST LIKE I'M YOU MORE
CREDIT CARDS I NEED TO LIMIT
THAT BECAUSE WHY BECAUSE IT'S
WHEN YOU REALIZE WHAT IT IS AND
WE WERE IN A CREDIT CARD
GENERATION.
WE HAD ALL OF US HAD JUST HUGE
NUMBERS OF CREDIT CARD EVERY
STORE EVERYWHERE YOU GO YOU HAVE
A CREDIT CARD BUT YOU BEGIN TO
REALIZE THIS EIGHTEEN OF 28% OF
WHATEVER IT WAS.
AND YOU PAYING MINIMAL TO DO IT
YOU'LL NEVER GET OUT OF DEBT YOU
KNOW YOU BY ADDRESS IT IS GOING
TO CST YOU OF THE DRESS IS
ALREADY IN PHONE AWAY AND YOU
STILL CAN'T.
FOR AND SO -- SO WE WE WE'VE
BEGUN TO DO THAT BECAUSE OF
INFORMATION WE DISCOVER WE BEGIN
THIS IDEA BEGIN TO CHANGE MY
BEHAVIOR WITH THE USE OF THIS
MAINLY BECAUSE OF THAT.
PEOPLE WILL SOMETIMES A JUSTIN
CHANGE IF THEY HAVE.
TO AND AS I LOOK AT THIS I
REALIZE IT IS GOING TO BE
DIFFICULT IS GOING TO BE A
CHALLENGE.
BUT IF WE HAVE TO DO SOMETHING
TO HELP PEOPLE CHANGE THEIR
BEHAVIOR WE TALK ALL THE TIME
ABOUT POVERTY IN THE STATE.
AND HOW WE OF CONTINUE TO HAVE
THIS HUGE GAP OF POVERTY AND IT
DOESN'T COME EASY FOR PEOPLE TO
CHANGE THEIR BEHAVIOR SO THIS IS
TO ME THIS IS ONE OF THOSE
THINGS THAT WE HAVE.
TO KIND OF FINALLY BITE THE
BULLET ON YOU KNOW WE'VE BEEN
I'VE BEEN IT IF SOME OF YOU BEEN
HERE WOULD HAVE BEEN HIS SEVEN
YEARS LISTENING TO THIS.
AND GRAPPLING WITH THAT IN
TRYING TO ASK MYSELF AM I DOING
MORE HARM TO PEOPLE POOR BECAUSE
THEY DON'T HAVE ACCESS TO
CAPITAL THEY DON'T HAVE SOMEBODY
YOU KNOW THEY'LL HAVE FAMILIES
THAT THE LOAN THE MONEY IF ON
AND ON AND ON AND AND THEN I
CAME TO THE REALIZATION.
THAT I COME FROM A FAMILY THAT
DIDN'T HAVE MONEY THAT PEOPLE
COULD LONGER.
AT AND AS A RESULT OF THAT MY
FAMILY HAD TO MAKE SURE THAT
THEY WATCH CAREFULLY WHAT WE DID
INVEST IN THINGS THAT WITH THEIR
AND WE NEVER HAD A HUGE SAVINGS
ACCOUNT OF THOSE KINDS OF THINGS.
BUT WE HAD TO MAKE SURE THAT WE
DIDN'T DIG A HOLE FOR OURSELVES
THAT WE DIDN'T WANT TO BE IN
THAT WE WERE ALREADY POOR BUT WE
DON'T WANT YOU POINT AND WHAT WE
WORK.
SO I YOU KNOW I SAID WITH THIS I
KNOW THAT YOU WRESTLE WITH THIS
FOR THAT WHEN YOU BECAME CHAIR
HE WHO SAID YOU'RE GOING TO STOP
IN THIS SPACE NOT LIKE ALL MY
GOD THIS YOU KNOW WHAT THIS IS
ABOUT.
DO YOU KNOW DO YOU KNOW WHERE
THIS LEADS US AND BUT I'VE BEEN
IMPRESSED THAT AT LEAST THEY
FOUND A STANDARD THAT THAT THAT
THAT IS WORK FOR THE FEDERAL
GOVERNMENT.
AS WORK FOR THE MILITARY AND IN
GOOD CONSCIENCE I HAVE TO SAY
LET ME SEE IF THIS WORKS A
CALIFORNIA BECAUSE I'D.
THANK YOU ALWAYS FUN TO GO AFTER
DOCTOR SHIRLEY WEBER CAN ASSURE
YOU -- FOR THE LENDERS DO YOU DO
BUSINESS IN ANY OTHER STATES.
WE OPERATE IN TWENTY SEVEN
STATES -- SO DO YOU OPERATE IN
ANY OF THE STATES THAT HAVE.
LOWER THAN 36% INTEREST RATES --
THERE'S YES WE DO BECAUSE WE
DIDN'T PREPARE THAT CHART AND
WHAT'S ON THAT CHART IS JUST THE
INTEREST RATE CAP IT DOESN'T
TAKE INTO ACCOUNT THE FEES
ADMINISTRATIVE CHARGES AND OTHER
THINGS PERMISSIBLE UNDER THE
STATUTE THE STATUTES ARE.
PRETTY COMPLICATED AND THAT'S
NOT AN ACCURATE REFLECTION.
GOT IT BUT SO YOU DO YOU DO
BUSINESS IN OTHER STATES THAT.
HAVE A 36% OR LOWER INTEREST
RATE AND YOU'D GIVE LOANS OF RT
TWENTY FIVE HUNDRED AND TEN
THOUSAND R. APR IS HIGHER THAN
36% -- THE INTEREST RATE CAPS
MAY BE THAT BUT IT IT HAS OTHER
PERMISSIBLE FEES AND CHARGES
THAT GETS THE AP UP UP TO A
LEVEL THAT WE CAN HAVE A VIABLE
PRODUCT FOR NON PRIME CONSUMERS.
SORRY ABLE TO DO ANY LOANS.
OF HELLO 36% EVEN WITH THOSE NO
WE DON'T BY COMPANY OPERATES IN
TWENTY SEVEN STATES ALL JUST NOT
MISS TO BE REALLY CLEAR WE DO
NOT OFFER ANY LOANS AT 36% APR
OR LOWER.
OKAY.
WELL I WANT TO THANK THE AUTHORS --
FOR BRINGING THIS BILL I FULLY
SUPPORTED I THINK IT'S
UNCONSCIONABLE WE HAVEN'T ACTED
ON IT YET I KNOW IT'S NOT BEEN
EASY PROCESS SO I WILL BE FULLY
WHOLEHEARTEDLY.
VOTING FOR THIS BILL TODAY THANK
YOU AND I DID WANT TO SEE AT IN
LIGHT OF YOUR COMMENT -- TO IF
MR GOVERNOR HAD ANY THING HE
WANTED TO ADD IN TERMS OF THE
COMPANIES THE LENDERS YOU
REPRESENT AND ADDING TO THIS --
ONLY IN SO MUCH AS OBVIOUS OF
THESE COMPANIES HAVE BEEN AROUND
QUITE SOME TIME.
THEY DO -- ISSUE LOANS AT THIRTY
SIX AND BELOW THESE ARE SELF
IMPOSED CAPS GENERALLY.
AND TO THE EXTENT SOME OF THESE
COMPANIES ARE ABLE TO PULL
PEOPLE OUT OF THE HIGHER
INTEREST LOANS.
THOSE BORROWERS ACTUALLY WOULD
HAVE QUALIFIED FOR THE LOANS IN
THE FIRST PLACE SO THE NOTION
THAT THE ONE POINT FOUR BILLION
IS GOING TO DRY UP.
IS ACTUALLY INCORRECT TO THE
EXTENT THERE ARE CONSUMERS IN
THAT SPACE WITH THEM QUALIFY.
FOR THESE LOANS A PILOT PROGRAM
LOANS PERSONALLY REFERENCE
EARLIER SO THAT PART OF THE
MARKET THOSE CONSUMERS WOULD
STILL HAVE ACCESS TO CAPITAL.
APPRECIATE IT THANK YOU.
I THANK YOU.
THIS IS THE MOST AWKWARD
COMMITTEE ROOM TO TESTIFY IN
ISN'T IT BECAUSE INEVITABLY
SOMEBODY BEHIND YOU WANTS TO
TALK TO YOU.
OKAY SO I HAVE A COUPLE OF
QUESTIONS YOUR FIRST ON ON THE
OUTSET LET ME SAY THAT -- I
APPRECIATE AND RESPECT I WHAT
THE AUTHORS ARE TRYING TO DO
LIKE I GET WHERE YOU'RE GOING
WITH THIS -- WHAT I WANT TO KNOW
IS?
OKAY WHAT'S.
WHAT'S THE DAY WHO CAN ANSWER
WHAT THE DEFAULT RATE IS ON
THESE TYPES OF LOANS THAT WERE
TALKING ABOUT ABOUT 36%.
WHAT THE DEFAULT RATE?
IT IS GONNA VERY I CAN TELL YOU
ON AVERAGE ARE DEFAULT RATE OF
THE TWO COMPANIES I REPRESENT.
IS 20% WHICH MEANS 80% OF PEOPLE
ARE RIPPING THOSE LOANS.
OKAY. 20% DID YOU HAVE SOMETHING
TO ADD.
YES SOME REMEMBER BLIND AS I
PULLED UP AT TEN K. FROM A LARGE
ONLINE WONDER.
THAT REPORTS A 52% CHARGE OFF
RATE.
OKAY SO THAT'S ONLINE LENDERS
CORRECT THAT'S A REGULATED.
RIGHT OKAY REGULATED OKAY SAID
THERE'S SOME VARIATION YOU'RE
SAYING 20% YOU'RE SAYING SOME AT
52% AND YOU HAVE SOMETHING AS
WELL YES -- AND I THINK.
THE HOME JUST KEEP IT BRIEF
[inaudible]
PEOPLE CONFUSE.
DEFAULT CHARTER FREIGHT LOAN
LOSSES -- PERHAPS WHAT MR
GOVERNOR'S LOOKING AT IS OUR GAP
ACCOUNTING PUBLIC RECORDS THAT
SHOW KIND OF THE CHARGE OFF
RATES -- OURS ARE LOAN LOSSES IN
OUR PUBLIC FILINGS FOR TWO
THOUSAND EIGHTEEN WERE 40% --
ONE MAIN WAS 25% THAT'S AN
APPLES TO APPLES COMPARISON FOR
YOU.
THAT REPRESENTS THE DIFFERENCE
IN THE TYPES OF CONSUMERS THAT
WE SERVE OKAY SO WE HAVE A
VARIETY THEN I WOULD SAY OF A
DEFAULT RATES THAT'S FINE -- SO
THEN.
TOO I GUESS TO THE AUTHORS --
WHERE WHERE ARE THE CONSUMERS IF
THEY CAN'T GET THIS TYPE OF LOAN?
WHERE WILL THEY GO?
SO THEY THERE ARE STILL OTHER
PRODUCTS ON THE MARKET AND THIS
LOAN LIKE WILL LIKE WHAT PAYDAY.
IS STILL IN THE MARKET THE PILOT
PROGRAM STILL IN THE MARKET AND
THIS LOAN THE 250-021-0000 IS
STILL IN THE MARKET AT A
DIFFERENT RATE.
THAT'S NOT GOING AWAY EXCEPT
OKAY EXCEPT IT'S NOT -- I GUESS
IF YOU TAKE.
IF YOU HAVE AB AND C. COMPANIES
THAT ARE AVAILABLE TO PROVIDE
THIS TYPE OF PRODUCT AND YOU
TAKE AWAY BE IN SEEING A LAMP A
LOT THEN THERE'S PROBABLY LESS
TO GO AROUND AND THAT WAS BEFORE
RIGHT.
ATTY JUST OR COULD BE LESS
ALTHOUGH I CAN TELL YOU THAT
FROM OUR CONVERSATIONS.
YOU KNOW WITH OTHER FOLKS IN THE
COUNTRY THEY WANT REGULATORY
STABILITY AND THERE MAY BE OTHER
FOLKS TO INVEST IN CALIFORNIA
ONCE THEY KNOW WHAT THE MARKET'S
GOING TO BE.
I CAN'T GUARANTEE THAT BUT FROM
CONVERSATIONS I'VE HAD OKAY SO
[inaudible]
I'M [inaudible]
HERE'S I'M OUT WITH THIS NUMBER
ONE WE HAVE HAD -- A LOT OF
DISCUSSION ABOUT.
THAT THIS IS PREDATORY TYPE OF
LENDING AND THAT IT'S IT'S SO
EXPENSIVE TO CONSUMERS.
AND THERE IS A REASON WHY.
EVEN THOUGH IT MAY M
EXPENSIVE TO US THEN WHY WOULD
ANYONE GO IN SEARCH OF THIS TYPE
OF LOAN PEOPLE STILL DO IT.
RIGHT EVEN THOUGH THEY HAVE
OTHER OPTIONS.
LIKE THE ONES THAT YOU YOU KNOW
SUGGESTED THEY'RE STILL DOING IT.
SO ALL RIGHT SO THERE'S A NEED
OUT THERE WHETHER WE AGREE WITH
THAT OR NOT.
BUT CALIFORNIA IS NUMBER ONE IN
POVERTY.
THERE'S A REASON PEOPLE NEED
THESE TYPES OF ONCE AND IT IS
NOT BECAUSE THEY'RE THEY'RE NOT
DEPENDENT ON ONE ANOTHER IF THE
POLICIES PUT IN PLACE IN
CALIFORNIA DID MAKE IT SO
EXPENSIVE.
PEOPLE WOULD NEED THESE TYPES OF
LOANS THE AVERAGE RENT OF A
STUDIO APARTMENT IN CALIFORNIA
SIXTEEN HUNDRED DOLLARS.
SO IT'S I THINK IT'S
DISINGENUOUS TO MAKE THE
VILLAINS OUT TO BE THE PEOPLE
THE WHO ARE PROVIDING THE LOANS.
THAT PEOPLE ARE SEEKING BECAUSE
IT'S SO EXPENSIVE TO LIVE IN
CALIFORNIA AND I DON'T DISAGREE
WITH YOU THAT -- PEOPLE GET INTO
THESE TYPES OF LOANS AND MAYBE
DON'T REALIZE EXACTLY WHAT
THEY'RE GETTING INTO I THINK A
LOT OF PEOPLE DO THOUGH -- I'VE
HAD MEMBERS OF MY OWN FAMILY WHO
ABUSED THESE TYPES OF LOAN
PRODUCTS IN A PAY THEM OFF.
NO IN IN THE AMOUNT OF TIME THEY
DIDN'T DON'T WANT TO END UP.
YOU KNOW SPENDING FORTY TWO
THOUSAND DOLLARS ON A FIVE
THOUSAND DOLLAR LOAN SOME PEOPLE
DO.
BUT WE ALSO HAVE TO INJECT INTO
THIS CONVERSATION PERSONAL
ACCOUNTABILITY AND PERSONAL
RESPONSIBILITY IN KNOWING WHAT
YOU'RE SIGNING UP FOR IN
AGREEING TO THAT.
AND AS DOCTOR WEBER SUGGESTED
YOU KNOW THERE WAS A TIME IN OUR
LIVES WHERE.
IF YOU COULDN'T AFFORD SOMETHING
YOU DIDN'T BUY IT.
I MEAN.
YEAH BUT WE WE CAN'T LEGISLATE
HOW -- BEHAVE I THINK WE'RE
BEYOND THAT POINT SO I I SEE A I
SEE A NUMBER I SEE THE
CALIFORNIA BUT CHAMBER OF
COMMERCE A CALIFORNIA HISPANIC
CHAMBER OF COMMERCE THE ORANGE
COUNTY HISPANIC.
I SEE A LOT OF ORGANIZATIONS
HERE THAT REPRESENT BLACK AND
BROWN COMMUNITIES THEY'RE
OPPOSED TO THIS BILL LIKELY
BECAUSE THE PEOPLE THEY
REPRESENT.
WANT TO HAVE ACCESS TO THIS FOR
RED GREEN WITH THAT OR NOT AND
THAT GIVES ME PAUSE -- SO I
GUESS I WILL IN MY COMMENTS WITH
THAT.
AND I JUST WANT TO GO ON RECORD
WITH SAYING THAT WHILE THERE'S
ALSO A LOT OF ORGANIZATIONS
FAITH BASED GROUPS VETERANS
GROUPS OF ORGANIZATIONS THAT
REPRESENT UNDER REPRESENTED --
COMMUNITIES IN THE STATE THAT
ARE ALSO IN FAVOR OF THE BILL SO
I THINK THAT THAT NEEDS TO BE
NOTED -- AS WELL AND I YOU KNOW
I APPRECIATE YOUR COMING ABOUT
POVERTY BECAUSE I ALSO THINK
THAT -- THIS CANNOT.
THIS PRODUCT CANNOT MASK ARE
NEED AS THE STATE LEGISLATURE TO
ADDRESS POVERTY AND THIS WILL
NOT GET US OUT OF POVERTY BY
OFFERING THIS PRODUCT AND AND I
THINK THAT THAT IS A BIGGER
CONVERSATION -- AND CERTAINLY
ONE THAT'S YOU KNOW WE'RE
COMMITTED TO TRYING TO FIGURE
OUT WHAT WE DO AS A STATE -- BUT
THIS REALLY CANNOT SERVE AS A
MASS FOR AT THE GREATER ISSUE
AND THE UNDERLYING ISSUE WHICH
IS WE HAVE PEOPLE WHO ARE IN
POVERTY AND THERE IS.
I THINK MERIT TO WHETHER OR NOT --
THIS MAKES IT THE OPTION WORSE
OR BETTER AND WE YOU KNOW THE
BECAUSE THE PRODUCT IS STILL
GONNA EXIST BECAUSE THEY'RE
STILL MULTIPLE PRODUCTS ON THE
MARKET.
AND WE'VE COME TO THE POINT
WHERE WE BELIEVE THAT THIS IS
ACTUALLY MOVING US IN A BETTER
DIRECTION.
THANK YOU SIR.
THE CONCERN WITH THE WAY THAT
THAT LOANS HAVE BEEN STRUCTURED
THE STATE OVER A LONG TIME THAT
THE NATURE OF THE PREDATORY
ASPECTS OF THEM IS TWO FOLD AND
ONE IS A NEWS IN.
JUST A STUNNINGLY HIGH.
INTEREST RATES THAT HOLD PEOPLE
INTO THE CYCLES OF DAD OVER AND
OVER AND OVER AGAIN.
AND THE SECOND ASPECT OF THE
PREDATORY NATURE IS THE WAY THAT
THEY'RE ADVERTISED AND I WOULD
HOPE IT PEOPLE WOULD TAKE A LOOK
AT THE NUMBERS THAT THAT GET
PRESENTED AND IF YOU -- TWO
THOUSAND DOLLARS AND THAT'S THE
AMOUNT OF MONEY THAT YOU'RE
TAKING OUT.
AND YOU END UP PAYING BACK.
THAT TWO THOUSAND DOLLARS PLUS
TEN OR FIFTEEN THOUSAND DOLLARS
IN INTEREST.
THAT SHOULD WAKE SOME FOLKS UP
UNFORTUNATELY IT DOESN'T BECAUSE
THERE THEY FEEL THAT THAT THESE
ARE THE ONLY OPTIONS THAT HAVE
BEEN PRESENTED TO THEM AND THAT
ARE AVAILABLE I THINK IF WE CAN.
BE AS SMART HERE AND PUT A
LEGITIMATE CAP AND LOOK AT IT
TAKE OFF THE TABLE LOANS THAT
ARE GUARANTEED TO PERPETUATE
POVERTY.
AND THEN THROUGH STRUCTURES LIKE
EARNED INCOME TAX CREDIT AND
REALLY WORKING HARD ON ENSURING
THAT WE HAVE FINANCIAL LITERACY
AND AT A MORE APPROPRIATE
PRODUCTS THAT EVEN THOUGH THE
36% IS PRETTY HIGH.
AND THEN IT SEEMS A LITTLE HARD
TO BE SUPPORTING SOMETHING AT
THAT LEVEL.
AT LEAST LOOKING WHAT THE
FEDERAL GOVERNMENT WANTS TO DO
WITH RESPECT TO MILITARY FOLKS
IN AND THEY THEY SAID THE 36%
THAT BECAUSE THEY SAY YOU'RE NOT
GONNA CHARGE.
OUR PEOPLE PEOPLE IN THE
MILITARY BEYOND 36% BECAUSE
THAT'S UNCONSCIONABLE THAT'S THE
FEDERAL GOVERNMENT.
STANCE ON THIS AND NOW WE HAVE
THE OPPORTUNITY TO ALIGN
OURSELVES WITH OTHER STATES
ENCOURAGE OTHER PROD PRODUCTS
AND YES THERE MAY BE SOME.
COMPANIES WHO ARE NOT WILLING TO
MAKE PRODUCTS AVAILABLE
CALIFORNIA BUT I THINK OTHERS
WELL AND WE HAVE PLENTY WHO ARE.
MAKING THOSE AVAILABLE NOW THERE
ARE OPTIONS WE NEED TO BE
LOOKING AT THOSE OPTIONS AND
ENSURING THAT WE ARE HELPING TO
CREATE AN ENVIRONMENT THAT IS
NOT PERPETUATING.
THIS IS THE OLD COMPANY STORE
STANDARD THAT WERE FIGHTING
AGAINST SINCE TWO THOUSAND AND
NINETEEN AND WE SHOULDN'T BE
DOING THAT ANYMORE.
SO VERY MUCH APPRECIATE YOU
BRINGING THIS FORWARD THIS HAS
BEEN AN ONGOING DEBATE WE HAD A
GREAT HEARING.
LAST WEEK FROM THE CFPB WHO GAVE
US THE NATION WIDE PERSPECTIVE
ON LOANS AND LOANS AMOUNTS AND
INTEREST RATES.
FROM THE STANDPOINT THAT THEY
WERE.
TRYING TO REGULATED AND MAKE
SURE THAT THAT THEY WERE TAKING
SOME OF THE WORST ACTORS.
OFF OF THE THE STAGE THAT THAT
WE'RE TALKING ABOUT A
FORTUNATELY THEY'RE NO LONGER
ABLE TO DO THAT SINCE THE
FEDERAL GOVERNMENT IS STEPPING
COMPLETELY AWAY WHICH MAKES IT
EVEN MORE CRITICAL.
THAT THE STATE OF CALIFORNIA
STEP UP TO PROTECT OUR OWN
CITIZENS.
SOMEONE OR ANY OTHER QUESTIONS.
THAT I DO HAVE A QUESTION FOR
THE AUTHORS AND A QUESTION FOR
THE OPPOSITION AGAIN I WANT TO
THANK YOU FOR BRINGING THIS
FORWARD WE THOUSANDS QUESTIONS
WITH.
YOU MADAM CHAIR AND ALSO A USING
WOMEN GRAYSON AND I CERTAINLY
APPRECIATE THE INTENT IN THIS
BILL WAS SOMETHING I HAD TO
GRAPPLE WITH. FOR A LONG PERIOD
OF TIME -- MY QUESTION IS.
SOMETHING THAT YOU GRAPPLE FOR A
LONG TIME 236% APR AS I
UNDERSTAND IT THOUGH IT TAKES
HISTORICAL PRECEDENTS.
EVEN THAT 36% BY ITSELF IT IS A
NUMBER THE ULTIMATELY IS THERE'S
NO FORMULA. TO IT I HEARD THE
CLOSEST THING WAS 3% TIMES --
TWELVE HAS THERE BEEN SESSIONS
OF MATURE THERE HAVE BEEN IN
TERMS OF IS THERE A WAY IN WHICH
THE OVERALL WHAT YOU'RE TRYING
TO DO IS TO MAKE SURE PEOPLE.
GATHERED AT IS THERE A NUMBER IN
WHICH THERE'S POSSIBLE THAT IS
AGREEABLE TO THE OPPOSITION THEY
CAN WORK WITH TO HAVE THEIR
FINANCIAL BUSINESS MODEL.
WORK FOR THEM WHILE AT THE SAME
TIME CERTAINLY THE CLIENT -- SO
THEY'LL BE MY MY FIRST QUESTION.
THANK YOU VICE CHAIR OF GEN AND
IF I MAY OF FOR SO JUST POINT
OUT THAT THE MILITARY LENDING
ACT WAS ACTUALLY PASSED UNDER A
REPUBLICAN PRESIDENT.
AND THIS IS THIS IS AND SHOULD
BE A BIPARTISAN ISSUE ABOUT
CONSUMER PROTECTIONS.
I THINK YOU'VE -- AND AND HAVE
HEARD -- BY A MULTIPLE FOLKS AND
IN TESTIMONY.
THAT -- THERE WAS NO MAGIC
NUMBER THERE WASN'T ANYTHING
THAT WE COULD DO TO TRY TO FIND
THAT THAT SWEET SPOT OTHER THAN.
CONSIDER WHAT WAS ALREADY
WORKING.
AND WE DON'T KNOW OF ANOTHER
NUMBER WILL WORK BUT WHAT WE DO
KNOW IS THAT 36% DOES WORK.
IT WORKS FOR OUR MILITARY AND SO
WITH THAT THAT WAS ONE OF THE
PRIMARY MAIN REASONS WHY WE
CHOSE.
TO FOLLOW SUIT OF SOMETHING THAT
ALREADY WORKS KNOWING THAT WHAT
WE CURRENTLY HAVE ISN'T WORKING.
THANK YOU.
THE ACTUALLY OF I'VE HAD SOME
CONSTITUENTS CONTACT ME -- TO MY
DISTRICT OFFICE OF YOUR PHONE
ALSO VIA MAIL THAT THEY'RE
CLAIMING AND THEY'RE STATING
THAT.
ONCE THIS.
GOES AWAY THIS ONE POINT THREE
BILLION ACCESS TO CAPITAL --
THAT THERE ARE NO LONGER HAVING
THE ABILITY. TO FUNCTION AS A
BUSINESSMAN IS IT YOUR INTENT
THAT THE NEW BUSINESS MODEL WILL
BE CREATED AND THAT NUMBER TWO
IS TO CURB BEHAVIOR TO DO
NEEDLESS SPENDING AND LOAN DEBTS.
SO I THINK THAT THE SO.
A THING MISTER GOVERNOR ACTUALLY
MENTIONED THAT THE ONE POINT --
THREE THAT MAY NOT BE SERVED BY
THE HIGH INTEREST LENDERS A BUT
IT COULD STILL BE SERVED BY
OTHERS SO THAT'S ONE OF THE
REALITIES -- AND I THINK THE
INTENT IS.
TO IDENTIFY WAYS THAT WE CAN
PERPETUATE RESPONSIBLE BUSINESS
MODEL ON THAT ALSO SERVES AS THE
CONSUMERS BUT STILL KEEPS THE
PRODUCT ON THE MARKET.
THANK YOU MANAGER OF MY LAST
QUESTIONS TO THE OPPOSITION.
AND YOU I GUESS MY ULTRA
QUESTIONS TO DR PAUL IF YOU WILL
WHY IS IT THAT WE HAVE LENDERS
THAT I HAVE THE ABILITY.
AS I UNDERSTAND FROM THEM THIS
HAVE -- IT WILL TO SERVE A VITAL
SCORE SIX HUNDRED BELOW -- WHILE
AT THE SAME TIME MAINTAINING
BUSINESS WISE OF THE YOUR
BUSINESS ARE NOT ABLE TO DO THAT.
IT IT REALLY IS ABOUT RISK.
AND INTEREST RATE.
OKAY.
I'D LIKE TO SEE THE NUMBERS OF
CUSTOMERS THAT THEY SERVE BELOW.
SIX HUNDRED FICUS SCORE OF IT
SHOULD BE A VERY VERY SMALL
NUMBER.
THERE MAY BE OTHER REASONS WHY
THEY DO IT [inaudible]
BUT ANYTIME YOU HAVE A HIGH
INTEREST RATE YOU HAVE A RISK
ASSOCIATED WITH IT WE UNDER
RIGHT ALL OF OUR LOANS --
WHETHER IN ALL OF OUR TITLE
LOANS UNSECURED LOANS SO IT'S
NOT THAT WE DON'T DO A GOOD JOB.
AT UNDERWRITING.
IT'S JUST A FACT OF LIFE THAT.
WE ARE HIGHER RISK I TOLD YOU
WHAT THE WHATTHE THE RATES --
ARE THE 20% -- DEFAULT.
AND SO AS A CONSEQUENCE.
YOUR IT'S A HIGHER RISK.
AND THEREFORE THAT'S WHY IT
COSTS MORE FOR US TO GET MONEY A
TO BORROW MONEY TO LEND MONEY
OUT.
AND WE WOULD LIKE TO BE ABLE TO
LEND MONEY OUT AHEAD. TO OUR
CUSTOMER BASE AGAIN IT'S
IMPORTANT TO UNDERSTAND WHAT OUR
CUSTOMER BASES I DON'T BELIEVE
THAT MR GOVERNOR'S -- MEMBERS
SERVICE OUR CUSTOMER BASE IN ANY
GREAT PERCENTAGES I COULD BE
WRONG.
MAY I ACT WITH COMMONSENSE.
I'D LIKE THAT [inaudible]
BUT SO OBVIOUS THAT REPRESENT A
TRADE ASSOCIATION CELL I LISTEN
TO MY MEMBERS AND WHAT THEY
CONVEY TO ME I ALSO KNOW.
THAT IF YOU LOOK AT THE PILOT
PROGRAM WHAT THEY HAVE CONVEYED
TO ME IT'S UP TO THE INDIVIDUAL
COMPANIES. TO GIVE ME A SPECIFIC
NUMBERS I'M NOT A POSITION TO DO
THAT BUT AGAIN THEY HAVE ASSURED
ME THEY TO ISSUE LOANS TO PEOPLE
WITH ZERO FIVE THE SCORES.
AND THEY DO ISSUE LOANS TO GET
PEOPLE OUT OF THE HIGH INTEREST
LOANS THE NUMBERS.
AGAIN I'M I'M NOT A POSITION TO
DO THAT CERTAINLY I CAN TALK TO
THEM.
AND REACH OUT TO THE COMPANIES
AND SEE WHAT THEY COULD SHARE
BUT I'M NOT A POSITION TO DO
THAT.
IF YOU WANT TO SAY SOMETHING BUT
HE PLEASE KEEP IT BRIEF.
YEAH YES YES I'M JUST JUST
ADDING I DID I DID REVIEW --
MISTER GOVERNOR'S -- LENDERS --
ONE MAIN REPORTS THAT THEIR
AVERAGE I GO SIX THIRTY FIVE
OPPORTUNE REPORTS THAT THE
AVERAGE PSYCHO IS SIX THIRTY
NINE MINUS -- SIX HUNDRED IN
JUSTONE OTHER COMMENT ON THE
MILITARY LANDING THERE IS NO
EVIDENCE THAT 36% IS WORKING FOR
THE MILITARY I WILL SHARE THAT
THEIR SPOUSES COME INTO OUR
STORES ALL THE TIME TRYING TO
CONCEAL THEIR STATUS BECAUSE
THEY NEED CREDIT.
THANK YOU -- COMMITTEE MEMBERS
ANY OTHER QUESTIONS.
WITH THAT MADAM CHAIR WOULD YOU
LIKE TO CLOSE.
THAT MEMBERS I THINK WE'VE HEARD.
A HEALTHY DISCUSSION FOR THE
LAST SIXTEEN MONTHS ABOUT THIS
ISSUE -- AND ANYTHING TO WHAT
YOU SEE HERE IS A BILL THAT
ASSEMBLY MEMBER GRAYSON AND I
HAVE BEEN WORKING ON TO FIND A
COMPROMISE WE UNDERSTAND THAT.
TO BOTH SIDES ARE MULTIPLE SIDES
THINK WE COULD DO MORE -- AND
AND CERTAINLY AT WHAT WE ARE
MOVING FORWARD IS SOMETHING THAT
WE FEEL IS AN IN BETWEEN OPTION --
THAT WILL KEEP UP BUSINESSES
OFFERING THE PRODUCT IN
CALIFORNIA AND THAT WILL NOT
TOUCH ON OTHER ASPECTS OF THE
PRODUCT OF A SORRY OTHER ASPECTS
OF THE SMALL DOLLAR LENDING
PRODUCTS OUT THERE -- AND WE
RESPECTFULLY ASK FOR AN AYE VOTE.
THANK YOU MADAM CHAIR OF THE
MOTION IS DUE PASSED TO SOME
APPROPRIATIONS BATON SECRETARY
WOULD YOU PLEASE CALL THE ROLL.
DO PASSED TO APPROPRIATIONS ALI
MON HI LIMON HI CHEN.
CHEN NO BEAR CAN'T HI THERE CAN
I BURKE [inaudible]
CERVANTES.
CERVANTES AYE CHOI.
NOW THE CHOI NO GABRIEL.
CABLE AYE GRAYSON AYE GRAYSON
AYE MELENDEZ.
MULLIN THERE'S NO STONE
[inaudible]
WEBER.
WEBER I WICKS.
THEBILL WILL MAKE ALL THE SIX
SIZE THREE KNOWS.
WILL PLACE ON CALL FOR THE
ABSENT MEMBERS THANK YOU VERY
MUCH MANAGER [inaudible]
THANK [inaudible] ONE MINUTE
[inaudible]
HE DID.
IT'S BEEN TWO DAYS I DON'T
REMEMBER [inaudible] ONE MORE
[inaudible]
THE AS MADAM CHAIR AT SOMEONE
AND Là M NOW.
SB SIX FORTY TWO PLEASE THANK
YOU MR CHAIRMAN MEMBERS AB SIX
FORTY TWO WILL PROVIDE IMPORTANT
CONSUMER PROTECTIONS FOR
THOUSANDS OF CONSUMERS AND SMALL
BUSINESS OWNERS WHO ARE SERVED
BY FINANCE LENDERS AND BROKERS
LICENSE.
UNDER THE CALIFORNIA FINANCE LAW
UNDER EXISTING LINE DEFINITION
OF BROKER AND IS IT'S VAGUE AND
IT'S CIRCULAR LEADING TO
CONFUSION FROM LENDERS ABOUT
WHICH ENTITIES CAN THEY CAN
PARTNER WITH WHEN ARRANGING
LOANS RUMORED BILL.
WE HAVE A MOVING TO SECOND.
AND I WILL SAY THAT TO KEEP IT
SHORT I WORKED EXTENSIVELY WITH
LENDERS ONLY GENERATORS ARE FOR
THE LAST YEAR TO ENSURE THAT
THIS BILL APPROPRIATELY JUST AS
THE CONSUMER PROTECTION
CONCERNED IN OUR LENDING MARKETS.
WITHOUT PLACING UNNECESSARY
BURDENS ON THE BUSINESSES --
THAT WORKED IN THAT AREA -- AND
I DO HAVE TO SEND MORE INTEL IN
SUPPORT OF THE BILL TESTIFYING.
GREAT I CHAIR VICE TURN MEMBERS
HIS AND MARTIN DEALS IN YOUR
POLICY COUNCIL WITH CONSUMER
REPORTS FORMALLY CONSUMERS UNION.
STRONG SUPPORT THE BILL OF
WORKED WITH THE CHAIR FOR THE
LAST YEAR ON IT.
IS VERY IMPORTANT TO THINK THE A
LOT OF CONSUMERS GOING ONLINE
DON'T NECESSARILY KNOW THAT WHEN
THEY CLICK ON AN AD IT'S A LEAD
GENERATOR NOT THE LENDER THEY
MAY NOT KNOW THE BADLY
GENERATORS BEING COMPENSATED.
OR HOW THEY'RE HANDLING THEIR
SENSE OF PERSONAL INFORMATION SO
THIS IS A VERY.
STRAIGHTFORWARD AND COMMON SENSE.
MEASURE TO UPDATE -- AND ENSURE
THAT OUR CONSUMER PROTECTION
LAWS KEEP UP WITH THE PACE OF
TECHNOLOGY.
AND I REALLY APPLAUD THE CHAIRS --
HARD LOOK THIS YEAR AND HOW WE
CAN IMPROVE STATE FINANCIAL
OVERSIGHT IN THIS I SEE IS A
CORE COMPONENT OF THAT STRATEGY
FOR THE OR SO AGAIN THANK YOU
MADAM CHAIR AND I REQUEST MY
THAT.
WHEN THIS IS A IN SUPPORT?
GOOD AFTERNOON DANIEL CANDOR
BECAUSE OUR ON BEHALF OF THE
CALIFORNIA LOW INCOME CONSUMER
COALITION IN SUPPORT.
CHRISTMAS OUR ON BEHALF OF ON
DECK CAPITAL IN SUPPORT OF THE
BILL.
MIKE BONTA GONNA BE HAVE THE
CITY AND COUNTY OF SAN FRANCISCO
TREASURER'S OFFICE IN SUPPORT.
WELL IN WHAT IS IN OPPOSITION.
NOT SEEN ON HOPES USER.
PARDON -- ACTUALLY WE'RE SUPPORT
IF AMENDED -- IS IT OKAY IF WE
PROCEED.
SUPPORT OF AN OKAY.
THANK YOU VERY MUCH SORRY FOR
THE CONFUSION HI DAVID CANTON ON
BEHALF OF THE ALL NIGHT LENDERS
ALLIANCE AND WE'RE YOU KNOW
WE'RE THANKFUL FOR THE
OPPORTUNITY TO WORK WITH THE
AUTHORS OFFICE.
IT'S BEEN A MULTI YEAR PROCESS
AND WE THINK WE'RE GETTING TO A
VERY VERY CLOSE PLACE IN A
LITTLE STREET THAT IN ONE IN ONE
SECOND HERE -- WE'RE SUPPORTERS
OF SUPPORTIVE OF LIFE LICENSING
IN GENERAL THE ONLY ISSUE THAT
WE HAVE IS WE HAVE TO MAKE SURE
THAT WHATEVER LICENSING OF LEAD
GENERATING THAT WE DO WE DON'T.
DISRUPT THE CUSTOMER'S
EXPERIENCE SO MUCH THAT THEY
MIGRATE AWAY FROM FROM THE FROM
THE EXPERIENCE IN MOVE TO NON
COMPLIANT LEAD GENERATORS WHICH
WILL LEAD THEM TO PREDATORY
SITES.
THAT'S OUR CONCERN SO AT THE END
OF THE DAY I THINK HERE'S WHERE
WE ARE WE HAVE THREE ISSUES THAT
WE WOULD LIKE FOR THE AUTHOR TO
PLEASE TO TO TO LOOK AT AND AND
I THINK IF WE CAN TAKE CARE
THESE WE WOULD BE THERE ON THE
BILL.
WITH YOU ONE OUR DISCLOSURES IN
CONSENT -- OVER HALF OF OUR
CUSTOMERS NOW COME BY WAY OF
CELL PHONE AND IF YOU KNOW BY
YOU KNOW CELL PHONE USE VERY
QUICK ACTING -- BY REQUIRING
THEM TO DO WE DISCLOSE IN
CONSENT MANY MANY TIMES
THROUGHOUT THE PROCESS WITH THE
DO THE TO SAY FORGET IT I'M GONE.
I'M TO GO TO A NON COMPLIANT
LEAD GENERATOR HE'S GOING TO
SEND ME SOME MONEY.
SO IF WE COULD GET A ONE AREA
FOR DISCLOSURE IN CONSENT I
THINK THAT WOULD MAKE OUR OUR
POSITION MUCH MUCH BETTER.
SECONDLY OR THE TEN POINT FONT
RIGHT NOW THE BILL HAS A VERY
PRESCRIPTIVE TEN POINT POINT
FONT -- REQUIREMENT AGAIN WITH
WITH MOBILE DEVICES THAT JUST
REALLY DOESN'T TRANSLATE TO THE
EXPERIENCE FOR THE CONSUMER SO
WE WOULD LIKE TO BE ABLE TO WORK
WITH THE AUTHOR ON SOME SORT OF
ON ME MIDDLE GROUND WHERE WE CAN
GET A LARGER FONT ESPECIALLY FOR
THOSE.
INSTANCES WHERE THE CONSUMERS
USING A MOLD MOBILE DEVICE AND
FINALLY -- THE ISSUE OF AMNESTY
WE HAVE MANY VERY GOOD LEE
GENERATORS WHO ARE CURRENTLY
OPERATING IN CALIFORNIA WHO WANT
TO BE COMPLIANT.
BUT WE WANT TO ENSURE THAT ONCE
THE BILL PASSES IN IF DOES
PASSED AND SIGNED INTO LAW.
THAT THEY AREN'T CUT OUT BECAUSE
THEY WERE ON ACTING AS A LEAD
GENERATOR SO WE WOULD LIKE SOME
SORT OF AMNESTY PROVISION IN
THERE SO THAT COMPLAIN LEE
GENERATORS CAN CONTINUE TO
OPERATE IN THE STATE OF
CALIFORNIA.
SO ANYWAY IF WE COULD LOOK AT
THOSE AMENDMENTS TO THE AUTHOR I
THINK WE WOULD BE ABLE TO BE
SUPPORTIVE OF THE BILL.
THANK YOU -- OTHER WITNESSES ANY
OTHER WITNESSES OPPOSITION.
MELANIE GRIFFITH WITH CAN TANA
WATSON HEARD MEN ON BEHALF OF
THE UP REALLY TRIED AGAIN IN
OPPOSE UNLESS AMENDED POSITION --
THIS REFLECTS OUR NEED TO CODIFY
TROUBLE SEVENTY IN THE BILL AS
WELL AS CLARIFYING THAT A
LEGITIMATE TRAVEL ANY BUSINESS
CAN CONTINUE TO DO BUSINESS WITH
A CALIFORNIA LICENSE FEE.
THANKS.
ALEX FELONIES ON BEHALF OF THE
US SMALL BUSINESS FINANCE
CESSATION OPPOSE UNLESS AMENDED
WE JUST WOULD LIKE TO SEE
COMMERCIAL LENDING TAKEN OUT OF
THE BILL -- COMMERCIAL LENDERS
ARE GOING TO THE PROCESS OF THE
PASSAGE OF SB TWELVE THIRTY FIVE
FROM LAST YEAR.
THEY'RE GOING TO THE REGULATORY
PROCESS AND DPO AND SO.
PART OF THAT PROCESS WILL BE THE
ADOPTION OF A COMPREHENSIVE
DISCLOSURE STATEMENT.
AND SO WE JUST DIDN'T WANT TO
HAVE COUPLE DISCLOSURE
STATEMENTS ONE PASSED BY THROUGH
THIS LONG THAT ONE THROUGH THE
REGULATORY PROCESS SO BUT WE
LOOK FOR TO HAVE A CONTINUING
CONVERSATIONS WITH THE AUTHOR.
AND THE STAFF IF WE CAN MEET UP
SOME FOR THE MIDDLE GROUND
MOVING FORWARD THANK YOU.
THANK YOU UP QUESTIONS FROM
COMMITTEE MEMBERS.
XENON MADAM CHAIR WAS LIKE TO
CLOSE.
WE CERTAINLY ARE HAPPY TO
CONTINUE A CALL CONVERSATIONS I
THINK THAT THAT'S SOMETHING THAT
WE'VE DONE ALL BILLS I DO WANT
TO POINT OUT THAT ON PAGE NINE
OF THE BILL -- EIGHT DOES
ACTUALLY.
CODIFY SECTION -- TWENTY TWO
ZERO FIVE POINT ONE WHICH HAS
NOTHING IN THIS DIVISION SHALL
IT BE INTERPRETED TO ALTER
FEDERAL AND STATE LAW GOVERNING
TRIBAL SOVEREIGNTY IMMUNITY SO I
WANT TO MAKE SURE THAT MEMBERS
DID SEE THAT THAT'S PUT INTO THE
BILL ON PAGE.
NINE THANK YOU MANAGER OF
MOTIONS TO PASS THE COMMITTEE ON
PRIVACY AND CONSUMER PROTECTION
ANY QUESTIONS FROM MEMBERS.
AS TO PASS -- WITH US THURMOND
SECRETARY WAS LIKE.
TO A CULTURAL PLEASE.
LIMóN HI THE ONE I CHEN.
CHAN NO POWER CAN'T.
WHERE CAN I BURKE?
BURKE I CERVANTES.
CERVANTES I CHOI.
SHOWING NO GABRIEL.
CABLE I RECENT.
GRAYSON I MELENDEZ.
LINDA IS KNOWN STONE
[inaudible]
WEBER.
WEBER I WICKS.
WICKS I EIGHTY THREE WILL HOLD
IT FOR THE ROLL CALL.
YEAH WITH. ONE YEAH.
I SAID LIKE YEAH [inaudible]
INSTRUCTORS HERE [inaudible]
THANK YOU.
SO WE'RE GONNA GO AHEAD AND DO --
ADD ONS FIRST WE ARE GOING TO
START -- WITH ADD ONS FOR THAT
COMMITTEE RULES
.
ALL RIGHT THAT MOVES.
THAT'S ADOPTED. ONE STORM.
THE STAFF.
IS THE ALL RIGHT NEXT WE HAVE --
THE CONSENT CALENDAR AND THAT
WAS GOOD. TWO BILLS AB FOUR ONE
TWO AND AB.
NINE ONE THREE ALL RIGHT WE'RE
NOT GONNA CLOSE EVER GONNA WAIT.
FOR AN ABSENT MEMBER NEXT WE
HAVE AB
.
FIVE THREE NINE PEOPLE FROM FOR
FEW MINUTES FROM.
WE'RE GONNA KEEP THAT OPEN FOR
AN ABSENT MEMBERS AND THEN
ACTUALLY WE ARE [inaudible]
MEDINA.
THE FIRST BILL [inaudible]
SELECT.
AB. ELEVEN EIGHTY NINE SIX
ELEVEN EIGHTY SIX ARE.
ELEVEN EIGHTY SIX RIGHT WE'RE
GONNA OPEN UP -- THE OTHERS.
IT'S WORTH TWENTY ONE SEVEN AB
F. BEFORE TWELVE ADOPTION OF THE
RULES.
I'M SORRY YEAH ADOPTION OF THE
RULES.
THE RULES ARE ADOPTED A THING.
NOW WE HAVE CONSENT CALENDAR
[inaudible]
SO.
NOW WE HAVE AB [inaudible]
FIVE THREE NINE STONE
[inaudible]
HI.
ALL RIGHT IN THAT BILL MOVES OUT
[inaudible] EIGHT TWO THREE THE
NEXT IS AB.
SIX FOUR TWO DON'T I DON'T WANT.
AND THAT BILL MOVES OUT.
NINETY THREE AND WITH THAT WE
WILL ADJOURN