Staff and Wire Report
The Montana Supreme Court says it won't block a proposed ballot initiative capping the interest rates on payday loans.
Initiative I-164 limits payday loans to an annual percentage rate of 36 percent. Backers gathered enough signatures earlier this year to qualify for the ballot.
But the payday loan industry argues the lower rate would make the short-term loans unprofitable. Industry representatives asked the state Supreme Court to toss out the initiative, arguing the ballot statement drafted by the state was not impartial.
The court, which often sees disputes over proposed initiatives, wrote in a Tuesday ruling that it will slightly change the ballot language to make it easier to understand.
Dissenting justices argued the court was overstepping its bounds by recasting the language.
A representative of the Montana Attorney General’s Office said this morning that the office was not in a position to comment on whether the initiative, if it passed, would apply to online payday loan companies based out of Montana, or whether it would apply to online payday loan companies working from within the boundaries of Indian reservations.
A case before the Supreme Court in Colorado is still pending on the latter issue. The court has heard arguments on a case appealed from a lower court on the question of whether Internet lenders based off of Indian reservations are immune from state regulations or must abide by the laws of the state where the borrower resides.
Experts say many groups in the country are watching the results of the Colorado case very closely.
The issue came to a head in the Havre area last year, when PDL Ventures, an operation of the Chippewa Cree Tribe on Rocky Boy’s Indian Reservation, began receiving numerous complaints filed with the Better Business Bureau. Representatives of the Tribe said many of the complaints may have been mistaken and were filed against other companies using the same abbreviated name — Payday Loan Ventures, PDL Ventures — and were taking action to improve customer service.
In a report dated today, the Spokane Better Business Bureau states that in the last 36 months it has received 143 complaints against PDL Ventures, with 29 resolved, one unpursuable, three unresolved, eight administratively closed by the bureau and 102 with no response from PDL Ventures.