Don't bank on regulations for payday lending just yet
The payday loan industry in New Mexico remains nearly unregulated, but not for lack of trying on the part of Gov. Bill Richardson and Attorney General Patricia Madrid. In late June, the Regulation and Licensing Department ended the public comment period for proposed regulations designed to limit fees, end interest and give payback options to payday loan consumers [RE: Newscity, "Money in the Bank?" June 29-July 5].
After the public comment period ended, the regulations were revised and set to take effect on Aug. 31 but now sit idle due to a preliminary injunction granted by a state district judge. The injunction, which bars the regulations from being enforced until further litigation, was granted on Aug. 30 in response to two separate lawsuits filed by Check ’n Go and Fast Bucks, national payday loan companies with stores in New Mexico.
Regulation and Licensing Superintendent Edward J. Lopez, Jr. says the department will respect the injunction. "We strongly believe the Legislature, in the Small Loans Act, gave the Regulation and Licensing Department the authority to draft these regulations and implement them," he says. Lopez says they will appeal the decision as soon as possible.