State auditors criticize lax regulations of payday lending
SALT LAKE CITY — A new state government audit found Utah's lax laws and loose oversight of the payday lending industry allows companies to get around a 70-day limit for extending loans to develop "chronic" customers who rack up huge amounts of interest.
The Salt Lake Tribune reports that auditors suggested the Legislature should adopt new laws to prevent these types of abuse.
Regulators at the Department of Financial Institutions identified 244 violations of the 70-day limit in 2015. However the agency will not levy fines until the same violation has been found in three consecutive years. Only one fine has been issued in the last five years.
According to the report, 32 percent of payday borrowers are chronic customers who often receive extensions on their loans or roll one loan into the next.
http://www.heraldextra.com/news/local/state-auditors-criticize-lax-regulations-of-payday-lending/article_cf894c37-efe1-5b9f-b637-9e66bc3675a9.html