Mark Dayton: “this legislation is entitled ``The Bankruptcy Abuse Prevention and Consumer Protection Act.'' Unfortunately, there is…”

“this legislation is entitled ``The Bankruptcy Abuse Prevention and Consumer Protection Act.'' Unfortunately, there is actually very little consumer protection in it. My amendment would add some much needed consumer protections to the bill and end one of the principal abuses that drives people into bankruptcy--exorbitant interest rates. My amendment would limit the maximum annual interest rate that could be charged to any consumer by any creditor to 30 percent. Thirty percent is still a very high interest rate--far too high, in my view. Inflation is currently running around 2 percent. The interest rate on 3-month Treasury bills is 2.75 percent. The prime lending rate is 5.5 percent. So 30 percent is exorbitantly high, but it is much less than the 384 percent that is being charged by money centers in Minnesota, or the 535-percent annual interest rate charged by centers in Wisconsin, or the 1,095-percent interest rate being charged by the County Bank of Rehoboth Beach in Delaware. That is not just predatory lending, that is ``terroristic'' lending. My amendment would apply to any rate of interest charged by any creditor to any borrower for any purpose. However, it would not preempt any State, local, or private restriction that imposes a lower rate of interest. For example, 21 States, which include my home State of Minnesota, cap interest rates for credit cards. Minnesota's ceiling is 18 percent. That would still apply.…”