Senate Banking Committee Approves Lieu Bill Protecting Military From Predatory Lenders

Sacramento, CA – Late yesterday, the Senate Committee on Banking, Finance, and Insurance approved AB 7 by Assemblymember Ted Lieu (D-Torrance) to extend strong financial protections for members of the armed forces and their families.  The bill had broad bipartisan support.

Lieu, a former military prosecutor, praised the committee for their action: “By passing this bill, the Committee has endorsed giving our service members some of the strongest financial protections in the nation.”

In October of last year, the United States Congress approved legislation to stop predatory lenders from targeting military personnel and their families. The federal protections, passed as an amendment to the Senate Defense Authorization bill, call for a 36% annual interest rate cap on loans to military personnel and their families that is consistent with recent recommendations by the Department of Defense.

Assemblymember Lieu’s legislation, AB 7, will strengthen enforcement of the federal protections for military personnel in California.  It updates existing financial law to specify that when lenders provide products to military personnel they must abide by the federal law.   The bill also gives the State of California the ability to directly enforce the federal statutes.

“We ask so much of our young men and women in uniform,” Lieu added.  “I think that protecting them from the most unscrupulous practices of some lenders is really the least we can do.”