When state lawmakers voted on a payday loan bill this year, they heard from a group not normally associated with the financial industry: the goons.
Pastors in state churches spoke out in favor of payday loans, and they weren’t alone. A leader from the Southern Christian Leadership Conference – the organization founded by Reverend Martin Luther King Jr. – supported him. Even the granddaughter of a famous civil rights leader in Florida was a lawyer.
Ministers handled the Tallahassee trek by flying in private jets chartered by Florida’s largest payday loan company, Amscot. They spread the wage gospel among black Democratic lawmakers, who were identified by the CEO of Amscot as critical to the bill’s success.
Amscot helped convince 23 of 26 black Democratic lawmakers to support the legislation. While this was roughly the same success rate Amscot had with the rest of the legislature, black Democratic lawmakers represented voters who studies had found could be most affected by the bill.
“What these pastors have done is cover up how these Democrats vote,” said Alice Vickers, director of the Florida Alliance for Consumer Protection, who was against the bill. “It gives them an excuse to vote. They get the cover of having all these black pastors transported here, so their vote looks like, “Oh, we’re doing this for their constituency”. “
This year’s bill was the biggest expansion in the payday loan industry since companies were allowed to operate in the state in the early 2000s. Companies like Amscot will now offer up. $ 1,000 loan and will charge up to $ 214 in fees. Previously, businesses could only offer $ 500 in loans and charge $ 55 in fees.
For Amscot and other companies, the invoice was essential to staying in business in Florida. A new Consumer Financial Protection Bureau rule, which was proposed under the Obama administration and is now suspended under the Trump administration, would wipe out the breakdown industry, the CFPB admits. By increasing the loan amount, lenders in Florida can get around the rule.
The bill made it through the Legislature this year despite concerns from consumer protection groups, who cited studies showing that payday loan companies unfairly target minority neighborhoods.
The ease with which the bill was passed surprised its opponents, who believed Democrats would rally against the industry.
“It was the most bizarre Democrat lineup around this issue that I have ever seen,” Vickers said.
Diane Standaert, executive vice president of the Center for Responsible Lending, called this “shocking”.
“It was almost as if the fate of the bill was predetermined from the start,” she said.
Republicans sponsored and pushed for the bill, but Janet Cruz of Tampa and Oscar Braynon of Miami Gardens, the two Democratic leaders in the House and Senate, co-sponsored it, and black Democrats seemed almost universally in favor of it. -this. Lawmakers and lawyers, including pastors, have said they don’t want the payday lending industry to disappear.
For Amscot, the lobbying campaign had been in the works for years. The company has engaged with church leaders and black community organizations, winning them over through dialogue, workshops and donations, for at least two years.
“We think it’s a good corporate citizen, and it’s the right thing to do,” said Ian MacKechnie, Founder and CEO of Amscot.
But skeptics might see it as an influence for future favors.
Evelyn Bethune, the granddaughter of civil rights leader Mary McLeod Bethune, told lawmakers in January that Amscot offered a “great product” and was a “great community partner.”
“They don’t just get out of the community,” she told them in January. “They are also reintegrated into the community. “
She later said Amscot paid for her plane ticket, including a return to Daytona Beach by private jet. She said Amscot had previously donated to her charity and would now ask Amscot to help fund a community garden project.
Reverend Manuel Sykes flew to Tallahassee aboard Amscot’s private jet and said his St. Petersburg church, Bethel Community Baptist, later received a “small contribution” from Amscot.
Reverend Wayne Wilson of the United Community Church of St. Petersburg said he also flew to Tallahassee, met with lawmakers and expressed support for the bill.
But Bethune, Sykes and Wilson said donations or Amscot plane tickets had not prompted them to support the legislation.
“I’m not for sale,” Wilson said. “But some people are. It would change their minds. It wouldn’t change mine.
Bethune said: “Amscot doesn’t have enough money to buy my support.”
Everyone has said that Amscot is a good corporate citizen.
“You can always count on Amscot for sponsorship, whether it’s a baseball team or a church trying to put on a special program,” said Sykes.
Lawyers noted that payday loans are cheaper and less harmful than credit cards and pawn shops, two other types of short-term credit. Unlike credit cards, Florida does not allow borrowers to take out more than one payday loan at a time. Even ardent opponents of payday lenders recognize that banks and credit unions do a bad job of providing credit to underprivileged communities.
Amscot has donated to other organizations. The Pinellas and Broward Counties Urban League received $ 100,000 in August. In January, a representative from the Pinellas chapter told lawmakers how he used a $ 500 payday loan to help his son go to college.
The company has also been a regular donor to the Florida Caucus of Black State Legislators. But its executive director, Ecytrim Lamarr, wouldn’t say exactly how much Amscot has given, and the organization is not disclosing its donors.
“They’ve been supporting us for about 10 years, and it ranges from $ 2,500, maybe 5, to a good few years, 10,” Lamarr said. “I would call them the middle of the pack,” compared to other corporate donors.
And while Amscot’s campaign contributions overwhelmingly favor Republicans, the company has mostly given to black Democrats over the past 18 months.
MacKechnie said he gives candidates of all races and all parties, and that he is not aiming for just one.
“If you are in a regulated business, or really any business, you have to be engaged in the political process,” he said. “All we ask is that our voices be heard and the chance to speak up for our cause.”
Opponents, who included other church leaders and the NAACP, saw it differently.
“What we’ve been exposed to is a well-funded access machine by the payday loan industry,” said Reverend James Golden, who has a church in Tampa and spoke out against the project. law in Tallahassee.
But Golden has not paid for its flights to the capital either. He said another interest group had paid for his flights on low-cost carrier Silver Airways, but he didn’t want to say who.
One of the surprising supporters of the bill, according to Vickers, was State Representative Sean Shaw, D-Tampa, candidate for the post of attorney general.
Shaw said bringing pastors to Tallahassee could have been a strategy to win Democrats over, and he said Amscot came to him to support the bill.
He said his support – he had voted for it three times in committees – caused anger and confusion among people.
“I was getting a lot of people who were upset and calling and wondering why I was doing it,” he said.
But he said he voted for it because so many people in his district depend on payday loans and he couldn’t vote which could potentially wipe out the industry.
“I wish they didn’t have to use payday loans to make ends meet every month,” he said. “But I know people who do.”
Contact Lawrence Mower at [email protected] Follow @ lmower3.