Yesterday's San Francisco Chronicle reported that City Attorney Dennis Herrera filed a UCL action against a group of "payday loan" firms for "marketing of short-term installment loans at unlawful interest rates to low-income borrowers." A copy of the complaint, which seeks injunctive relief, restitution, and civil penalties under the UCL, is available at this link, along with the city attorney's press release.
The complaint invokes the UCL's "unlawful" prong by alleging violations of the California Deferred Deposit Transaction Law (Fin. Code §§23000 et seq.), the California Finance Lenders Law (Fin. Code §§22000 et seq.), and other laws. The complaint also invokes the "unfair" prong by alleging that the defendants' "lending and brokering practices constitute unfair business practices because they offend established public policy, and because the harm they cause to consumers in California greatly outweights any benefits associated with those practices." This, of course, is the pre-Cel-Tech formulation of "unfair." The complaint's "aiding and abetting" allegations are also interesting.
I am getting tired of city officials jumping on political bandwagons. Remember prop H: the ridiculous ban on handguns? And then the Supervisors move to impeach Bush—look out W, the gig is up! Now Hererra reads the paper about places like Iowa and New Hampshire and he's going after the payday lenders because they're a fat target that will likely propel him to the next-up office. What about going after landlords gouging tenants citywide? They are definitely worse than all the world's payday lenders put together. Remember public power? PG&E gets more money out of us than Western Union does. Our officials need to worry about the REAL problems that plague San Franciscans.
Posted by: Suzanne Eubick | Monday, April 30, 2007 at 07:31 PM