Former Payday Lender Offers Apology as Vote to Cap Interest Rate Nears

Stacey Brown said he went to Check 'n Go on Eighth Street SE in 2001 and borrowed $500 in a payday advance to help him pay some bills.

Last week, he finally paid off the loan and all the fees and interest that came with rolling it over. His total in fees and interest: $14,997.

Yesterday, Brown received an apology from Cameron Blakely, a former Check 'n Go manager, on the steps of the John A. Wilson Building during a news conference touting D.C. Council legislation that payday lenders say could put them out of business in the city.

The council voted 12 to 0 in July to give preliminary approval to the legislation, which would limit the annual percentage rate charged for such two-week loans to 24 percent, the same rate as banks and credit unions.

On the eve of the council's final vote on the measure, a parade of advocates and former Check 'n Go employees surrounded council member Mary M. Cheh (D-Ward 3), one of the bill's sponsors. Cheh said she wanted to combat the industry's aggressive campaign against the bill. "They're swarming all over this District building," she said.

Cheh said she hopes the council will vote unanimously to approve the measure Tuesday.

In mid-August, the D.C. Financial Services Association, which represents 41 of 48 payday loan stores in the city, started an advertising campaign encouraging residents to speak out against the bill.

Check 'n Go issued a statement through Dan Pinger Public Relations yesterday rebutting accounts by employees.

"At a news conference today, three disgruntled former employees made false and reckless statements regarding the business practices of Check 'n Go. . . . Check 'n Go adheres to all local regulations and industry best practices that provide for a variety of consumer safeguards," the statement said.

The District association, led by Check 'n Go and ACE Cash Express, says that if the legislation is adopted, residents would lose a lending choice, one that does not require a credit check and that helps people who need money for emergencies.

Currently, lenders can charge a $16.11 fee per $100 borrowed.

The proposed 24 percent rate would result in a little over 90 cents per $100 borrowed, which payday lenders say would make it impossible for them to operate.