Investigation: Military Still Targeted by Predatory Lenders

Photo courtesy of Pendleton.Marines.mil

Photo courtesy of Pendleton.Marines.mil

Service members are supposed to be protected from predatory lenders thanks to the Military Lending Act (MLA) in place for several years.

However, a joint investigation by Marketplace and ProPublica found that while the act did reduce the number of “payday loan” problems, the law does not regulate loans that extend beyond three months.

The MLA did little to regulate open-ended credit, or military installment loans longer than 91 days. Those are still available to service members, and in some cases aggressively sold to them. Some payday and title lenders have found ways to exploit gaps in the MLA, offering longer-term high-interest installment loans, sometimes backed by a car-title, that are not illegal but can send service members into a deepening spiral of debt.

Financial troubles are considered a serious threat to force readiness according to the Department of Defense.

At issue now, according to the report, are short-term high-interest cash loans. These “installment lenders” and pawn shops can be found outside the entrances of most military bases.

“I think it’s been a vexing problem for the military,” says Holly Petraeus, assistant director of the new Consumer Financial Protection Bureau in Washington.

She points out that the Department of Defense has tried hard to offer alternatives, providing low-cost emergency loans to low-income, cash-strapped military families. But there’s some paperwork involved, and permission from someone up the chain of command may be required, and follow-up financial counseling is strongly encouraged.

“People don’t want to come in and say they’ve messed up their finances,” she says. “And yet, with products where they’re just repeatedly paying large fees to borrow the same small amounts every month—you’re going to end up in a terrible financial mess, and with the real potential of losing your security clearance.”

You can read the full Marketplace and ProPublica report and check out the entire series HERE.

 

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All Sexual Assault Prevention Personnel Must Be Re-trained

Courtesy Dept. of Defense

Courtesy Dept. of Defense

Increased incidents of military sexual assault coupled with reports of alleged abuse by military members assigned to prevent such assaults has prompted Defense Secretary Chuck Hagel to order the retraining, re-credentialing and re-screening of all personnel involved with sexual assault prevention and military recruiting.

Defense Secretary Orders Retraining

The retraining was directed by Hagel after he was briefed on the second incident involving prevention personnel according to the American Forces Press Service.

“I cannot convey strongly enough his frustration, anger and disappointment over these troubling allegations and the breakdown in discipline and standards they imply,” Pentagon Press Secretary George Little said.

… Little said Hagel directed the retraining, re-credentialing and rescreening to address the broader concerns that have arisen out of these allegations and other recent events. Continue reading

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