Looking Out for the little guy

It seems our cousins to the North (Carolina) are quite astute when it comes to looking for the little guy. I was so pleased to read in the Island Packet this morning that the North Carolina Banking Commission slammed Advance America’s appeal for violations of North Carolina’s Consumer Finance Laws and (NC) State Check Cashing Laws. The Commission ruled America Advance’s interest charge of over 400% on personal/payroll check loans was in clear violation of Consumer Finance Laws. The 117 offices of Advance America will be shut down in North Carolina for this violation. (The Spartanburg based company operates over 2,000 locations in the Southeast.) The bright-line rule here is based on the NC State Law maximum allocation for interest charges @ a rate of 36%.

I am glad to see government regulators finally stepping in to stop the downward spiral many Americans on the lower end of the economic spectrum face. These companies are nothing more than poachers who feast on the monetarily lame and weak. These ‘poor’ folks with their back against the wall turn to these companies to get out of a jam, but are left in a worse position than when they started. Sadly, a majority of the 117 Advance America stores in North Carolina are located within five-miles of US Military bases. As we all know (and love) North Carolina is a military friendly state, with the largest US Marine installment (Camp Le Jeune) as well as a vast US Army base (Ft. Bragg) and a handful of other bases are all located within the Tar Heel state, companies such as America Advance had two huge incentives to set up shop. 1) A majority of military families are eligible for Government Food Stamps or WIC because of their high debt to income ratio. 2) Military personnel can in many circumstances be punished for welching on their debts as this shows poor character on the payer, regardless of the challenging terms set (negotiated) by the payer. Bravo to the gang up in Charlotte for putting the kibosh on pick-pocket companies such as Advance America.