The Moral Implications of Payday Loans

At Credit Slips, Nathalie Martin has this post on high-interest loans to poor people.  Here's the first paragraph of the post:

Those of us struggling with the issues raised by payday and title loans are consistently told to take morality out of the equation when considering these loans. Thus, it was refreshing to hear a recent presentation by Professor Alex Mikulich of the Jesuit Social Research Institute at Loyola New Orleans entitled “From the Peril of Predatory Lending to the Hope of Economic Justice: A Religious Social Ethical Perspective.” Rather than avoiding morality questions, Professor Mikulich focused exclusively on them in his eye-opening presentation at a recent Family Impact Seminar. He noted that the loans create many unjust results, and then explained that the literal translation of the word usury in Hebrew is to “take a bite out" of the poor.   He distinguished usury from mere  “interest,” which Professor Mikulich defines as part of a mutually beneficial relationship that is good for the community as a whole.

Consumer Financial Protection Bureau Launches On-Line College Cost Comparison Tool

The Consumer Financial Protection Bureau has just launched a beta version of a college cost comparison tool. It is aimed at allowing consumers to make comparisons of the costs of various colleges based on each consumer's financial circumstances. Use the tool, and then let the CFPB know what you think.

Register now for Teaching Consumer Law Conference

On May 18th and 19th, the Center for Consumer Law at the University of Houston Law Center will hold its sixth bi-annual Teaching Consumer Law Conference.

            This year’s theme is “Teaching Consumer Law in an Evolving Economy.” This is the only conference devoted exclusively to the teaching of consumer law, and is designed for those currently teaching consumer law, as well as anyone who is interested in teaching or just wants to know more about consumer law issues. More than 30 presenters will discuss issues ranging from Fringe Banking, Debt Collection and Advertising, to Foreclosure, Payments and Arbitration. There also are several presentations discussing consumer law from an international perspective. Presenters include law faculty, adjunct faculty, and practicing attorneys. There also is ample time to socialize, and an opportunity see the Houston Astros take on the Texas Rangers.  For more information and a registration form, click here. 

 

Barney and the Nudes

by Jeff Sovern

Recently I was at the home of a family with a two-year old.   Because the two-year old likes Barney, the family played videos of Barney songs on YouTube.  Next to the videos appeared a series of ads. Among these ads were pictures of singles in revealing clothing.  Occasionally, an ad cycled in of a barely-dressed woman.  Those clicking on the woman were treated to pictures of various other women, at least one of whom was unclothed.  Barney's take: "Every one is special." 

Of course, the two-year old can't read and the ads have no meaning for children that age.  But they might have meaning for children only slightly older, and they probably watch YouTube videos too.  Beneath the ads appears a legend indicating that YouTube is not responsible for them.  But someone is, and it is hard to believe that whoever runs the ads is unaware of the possibility that they will be displayed next to children's programming, nor that YouTube has no power to enter into contracts to prevent such advertising during children's programming.

Society provides a variety of special protections for children.  Some of these are enacted into law, like the Children's Online Privacy Protection Act. Others have come through self-regulation.  As a result, for all the problems with the ads shown during children's television shows, you will not see nudes during those ads.  I am not up on the laws governing internet ads accompanying programming to children, though I know that the Supreme Court has invalidated some such laws on first amendment grounds. But regardless of the legal background, you would think YouTube--which is owned by Google of "Don't be evil" fame, would take steps to prevent such advertising from being shown during videos of interest principally to children.

Movement in the States to Increase the Minimum Wage

The federal minimum wage is $7.25 per hour and hasn't gone up in nearly 3 years. But there's a movement in some states to increase the minimum wage for in-state workers above the federal level. It's already $9 per hour in Washington state, and legislation is pending in Massachusetts that would push the minimum wage to $10 per hour. The efforts in the states have encouraged some members of Congress to push for for an increase in the national minimum wage. Read about it here.

Hearing Loss, Consumer Protection, and Advances in Medical Technology

The sale of devices claimed to improve a consumer's hearing was so much the province of charlatans that shortly after Congress enacted the federal medical device laws in 1976 hearing aids became one of the few medical devices subject to device-specific FDA marketing and labeling regulations. (Go here to view FDA's hearing aid home page.) Moreover, the need for consumer regulation was deemed so great that, nearly alone among medical devices, the federal government allowed the states to regulate hearing aids alongside the FDA. See 21 C.F.R. 808.53-.101.

But hearing loss is a serious health problem. Recent research shows that by age 70 almost 2 of 3 Americans will have significant hearing loss. The numbers soar to 4 out of 5 by age 85. Today's Washington Post has a series of interesting articles about what appear to be significant (but costly) advances in hearing aid technology. Go here, here, and here.

More on the Slippery Slope From Health Insurance to Broccoli

We blogged earlier on slippery slope arguments and the Supreme Court's health care case. Here's another thought from the Economist.

New Federal Housing Administration Rule Tightens Home Purchase Eligibility

As Kenneth Harney at the LA Time explains:

A little-noticed mortgage rule change that took effect April 1 could create hassles for significant numbers of home buyers who plan to use low-down-payment FHA financing this spring. The change affects anyone with one or more "collection" accounts buried away in national credit bureau files. These include medical, student loan, retail and other debts reported as unpaid — correctly or incorrectly — by creditors and subsequently sent to collection agencies. In a reversal of its previous policy, the Federal Housing Administration says it will no longer approve applications when the borrowers have outstanding collections or disputed accounts with an aggregate of $1,000 or more of unpaid bills. Previously the agency took a more lenient approach, allowing lenders to review borrowers' overall credit situation and approve applications despite the presence of such accounts.

Tax Refund Anticipation Loans Are Dying

Tax refund anticipation loans are very short-term, high-interest loans provided by tax preparers to taxpayers in anticipation of their tax refunds. When taxpayers are provided with accurate information, generally they will conclude that these loans are a bad idea because the IRS can provide refunds very promptly (and at no charge!). We have blogged about tax refund anticipation loans -- here, here, here, here, and here -- including about why, because of the advocacy of public interest organizations and resulting federal regulatory policy, the refund loan industry was dying an appropriate death. Sunday's Washington Post confirms the trend.

Times Article on Spam Texts and Smishing

by Jeff Sovern

Here.  This is a problem where the law did what it could before the issue became common; spam text is outlawed both under regulations adopted under the federal CAN-SPAM Act (as long as the cell phone has a unique electronic address, which I gather they all do) and the federal TCPA (if the texts are sent via autodialer, which they likely are as it would be too time-consuming to send text spam from phones manually by entering in the number and text).  Yet the federal laws have not prevented bad actors from sending spam texts.  This seems like an area, like conventional email spam, where a technical solution is going to be more effective than one crafted by law-makers.  Smishing, by the way, is the text equivalent of phishing emails.