Our veterans need protection at home — from predatory lenders and financial fraud

U.S. PIRG

While many Americans honor our active and retired military on Veterans Day, federal officials are threatening to weaken financial protections for servicemembers, veterans and their families.

“This Veterans Day and every day, we at the PIRGs salute our servicemembers and veterans for their service and partner with organizations that support military families,” said Mike Litt, U.S. PIRG Consumer Campaign Director. “We’re banding together to make sure that our protectors are protected from unscrupulous financial institutions and that the federal government properly enforces laws to protect our troops.”

PIRG noted that, despite strong opposition from the Pentagon, 33 bi-partisan state Attorneys General, numerous members of the House and Senate and a broad coalition of military family, consumer, faith and civil rights organizations, Mick Mulvaney, acting director of the Consumer Financial Protection Bureau (CFPB), has said he will no longer fully enforce the Military Lending Act (MLA), which provides strong protections to active duty servicemembers. To combat that federal mindset, PIRG is helping our troops at the state level.

“On Election Day, a CoPIRG-backed coalition successfully urged Colorado voters to enact Proposition 111 to become the 16th state to impose strict standards on predatory payday lenders,” added Danny Katz, CoPIRG executive director. “On top of the protections enshrined in the MLA for servicemembers, Prop. 111 will make sure that no veteran or veteran’s family in Colorado pays more than a 36% interest rate.”

Other examples of our work include:

— Our 2017 report, “Protecting Those Who Serve,” highlighted thousands of complaints from servicemembers and veterans to the CFPB. We released it at the VFW National headquarters jointly with several other military family organizations. The report also documented how predatory lenders “line up like bears on a trout stream” outside military bases and try to take advantage of young servicemembers.

— We have worked with military family support organizations to oppose weakening of the CFPB or its rules that protect servicemembers and veterans from financial schemes and illegal interest rates.

— We have worked with military family support organizations to hold the credit bureau Equifax accountable and give servicemembers greater rights to freeze and to monitor their credit reports. That’s especially critical during deployment, when troops may not receive mail on a timely basis.

“The Pentagon says that bad credit is the leading cause of losing a security clearance necessary to deploy on a ship or overseas,” concluded Ed Mierzwinski, Senior Director for Consumer Programs at U.S. PIRG. “So, protecting servicemembers from financial schemes and incorrect credit reports isn’t only the right thing to do to, it helps unit readiness.”