From the Star Tribune:
Brad Rixmann, chief executive of Burnsville-based Payday America, is a giant on the payday lending scene, operating the largest such business in the state. He also is a major player in Minnesota politics, having doled out nearly $550,000 in state campaign donations over the last decade.
As Rixmann’s contributions have grown, so has his business, aided by state law that allows him to charge triple-digit interest rates on loans that can go up to $1,000. His customers pay an average of 277 percent interest, sometimes borrowing repeatedly against their next paycheck.
15 states have banned payday lending, which more often traps borrowers in a cycle of debt than helps them deal with emergencies as intended.
At MinnPost, Bill Lindeke reports on a silent war going on in Minneapolis and St. Paul. Predatory lenders staple their signs to utility poles and plant them in boulevards, and do-gooders like St. Paul City Council member Amy Brendmoen and North Minneapolis activist Jeff Skrenes take them down. It has even escalated — literally. Skrenes carries a 10′ ice scraper to reach the signs, which the lenders are posting out of reach to try to keep them up longer.
The signs are illegal, and the people and companies posting them are generally engaging in some form of DIY predatory lending — offering a bad deal to people struggling with a mortgage that was probably a bad deal to begin with. It must work, because the signs keep going up even though people like Brendmoen and Skrenes keep taking them down.
But there are better options for homeowners struggling with a mortgage. Both the Minnesota Homeownership Center and Habitat for Humanity have phone hotlines and can help homeowners figure out what they can do. The best option is almost certainly not taking a fraction of the equity in cash or converting bad mortgage into a bad contract for deed.
Two weeks ago, it was big news when a Salt Lake City school took lunches away from students when their card was declined at the register. (Students at many schools use a card to buy lunches, and parents are responsible for depositing money to the student’s lunch card account through the school’s website.)
It turns out that many Minnesota schools do the same thing. According to the StarTribune:
A majority of public school districts in this state deny hot lunch — or any lunch at all in some cases — to children who can’t pay for them. Some schools take the meals from students in the lunch line and dump them in the trash when the computer shows a deficit in their lunch accounts.
The Minnesota interest rate for debts due to overdrawn bank accounts is 6%. Bradstreet & Associates was trying to charge 21.75%. According to Minnesota Attorney General Lori Swanson,
Since 2009, Bradstreet and its predecessor company bought at least $18 million in debt that originated with Wells Fargo and U.S. Bank. This affects, we believe, at least 16,000 Minnesota consumers.
The Minnesota Government Data Practices Act determines what state agencies must do with the enormous mountains of data they collect. Most data is public (PDF overview), unless a statute or rule makes certain data private.
Many agencies provide email-based notifications, like snow emergency alerts or city council meetings, It turns out there is no statute or rule making those email addresses private, even though most of the websites where those email addresses are collected claim they will be kept confidential.
Guest post by Aaron Hall.
Minnesota consumers can now bring more cases to conciliation court, and many see this as good news. Unlike regular district court, conciliation court was created to handle “small claims” with relaxed rules and procedures so people don’t need to hire an attorney.
Today, Minnesota Governor Mark Dayton vetoed a package of tort-reform bills passed by the state legislature earlier this week. I was particularly happy to see his reasons for vetoing SF 429, which would have rendered many consumer and civil rights statutes effectively unenforceable in Minnesota. Here’s a choice excerpt from Governor Dayton’s veto letter for that bill:
Over 300 Minnesota statutes require the shifting of attorney fees to the wrongdoer—all of which would be negatively impacted by this legislation. Deployed military personnel, farmers, vulnerable adults, and victims of workplace harassment, wrongful termination, and discrimination are just a few of the classes of individuals that would be harmed by this legislation.
Across the country, legislators (mostly Republicans) are pushing for so-called “voter ID” laws that would require every voter to present a photo ID before casting his or her vote. This requirement is ostensibly meant to reduce voting fraud. In fact, it would do no such thing.
I’ve been following the progress of several Minnesota “tort reform” measures. I put that in quotation marks because most of the bills in question don’t just reform the law of tort; they also eviscerate a raft of consumer laws, robbing consumers of important protections. These are laws designed to prevent fraud, harassment, and abuse. If enforced, these laws could help prevent another economic meltdown. These bills could hasten the next recession by shielding defendants from the law and encouraging the sort of behavior that led to the last one.