OneMN.org Statement on Increase in Predatory Small/Minority Business Lending
For immediate release: September 24, 2019
Contact: Brett Buckner, email@example.com
We are concerned about recent cases of predatory lending aimed at minority and small business owners. The tactic of these predatory lenders is to shift focus from consumer loans where there are greater protections to business loans where there is less protection. We call on elected and policy leaders to implement strategies to protect small and minority businesses from predatory lending.
Predatory lending to small businesses, especially minority owned businesses could be the “next credit crisis” Governing Magazine reported in a 2015 article (https://bit.ly/2mSIXoL). Currently in both the US House and Senate there are bills aimed at small business predatory lending (Small Business Fair Lending Act).
“We are seeing minority businesses straddled with loans with unrealistic interest rates,” said Patrick Pariseau, Director, Financial Solutions for MEDA an organization focused on minority business development in Minnesota.
Community members are concerned about a prominent business in Little Africa in Saint Paul that is saddled with a loan with payments over 100 percent of the loan amount on a short term loan and being threatened with foreclosure. “It is very unfortunate a core anchor business in Little Africa is under such great financial stress with a risk of losing their business,” said Gene Gelgelu, President of AEDS and the visionary behind Little Africa, a strategy to create wealth in low income diverse communities.
“This is a classic case from the predatory loan playbook -business desperately needing a loan enters into a short term loan with high origination fees, interest rates and default payments, incomplete loan payout information without details separating interest rates, fees and other payments, aggressive pressure tactics with the ultimate notice for foreclosure, “ said Dr. Bruce Corrie an economist. “I am a resident of Saint Paul for over 30 years and I am very clear – Not in My City.”
OneMN.org requests elected and policy leaders to:
Introduce/support legislation at the national, state and local level protecting small business owners from predatory lending by setting a cap on interest and fees to a reasonable level.
Specify “transparency” in loan agreements during loan origination as well as when requested by a borrower that breaks down payoff amount into interest, fees and other payments
Eliminate “confessions of judgement” and other ways that take away borrower’s rights
Increase education of small business owners on the dangers of predatory lending
Increase the pool of capital for small and minority owned businesses
Increase the availability of low cost/pro bono technical assistance, especially legal review of contract documents
Establish a small and minority business protection unit in the Attorney General’s office and the Department of Commerce, and make it more easily accessible to the community.
A Call to Minnesota Elected, Business and Community Leaders to visibly and strongly affirm Minnesota’s Core identity as Open, Welcoming and Safe. November 16, 2016,
Governor Mark Dayton Speaker Kurt Daudt Majority Leader-elect Paul Gazelka Majority Leader-elect Joyce Peppin Minority Leader-elect Tom Bakk Minority Leader-elect Melissa Hortman Greetings and congratulations to the newly elected leaders, All across Minnesota there is a heightened state of anxiety and fear within the ALANA (African, African American, Latino, Asian, and Native American) communities, LGBTQ community, minority religious groups and Minnesotans in general. This is greatly affecting our children, especially young women and girls. Unfortunately since the election, there has been a significant increase in incidents committed by a small number within our schools, places of work and in the public which have sought to divide us as a community and make some of us feel unwelcome and safe. When trust and respect is lost, our society could collapse. We must work to change the environment very soon. In this context, we call on our elected, business and community leaders, led by Governor Dayton, and our legislative leaders in partnership with business, religious and community organizations to provide a very visible and joint message to Minnesotans that they are committed to keeping Minnesota open, welcoming and safe with great intent and urgency towards shared prosperity and common respect for all Minnesotans. The undersigned organizations call for your leadership to visibly and strongly affirm Minnesota’s Core identity as Open, Welcoming and Safe and are ready to stand with them to achieve respect and prosperity for all Minnesotans. OneMN.org Advocates for Human Rights Acctech LLC African American Leadership Forum (AALF) African Immigrant Services (AIS) African Reconciliation and Development Organization (ARDO) Anika Foundation Al-Amal School American Indian Community Housing Organization Council on American Islamic Relations (CAIR) Chai.News Coalition of Asian American Leaders (CAAL) Comunidades Latinas Unidas En Servicio (Latino Communities United In Service - CLUES) Common Cause - Minnesota Confederation of Somali Community in Minnesota (CSM-MN) Corridor Design Hmong Chamber of Commerce Immigration Law Center of Minnesota India Association of Minnesota Indian American Muslim Council (IAMC) MN Chapter Isimetrics Islamic Cultural Community Center Islamic Center of Minnesota Isuroon Jewish Community Action (JCA) Oromo Chamber of Commerce Lao Assistance Center Latino Chamber of Commerce of MN Latino LEAD Masjid Al Kareem MetroIBA Minnesota Black Chamber of Commerce Minnesota Chamber of Commerce Minnesota Indian Business Alliance Muslim American Society of Minnesota Muslim Health Professionals of Minnesota Northwest Indian Community Development Center Northwest Islamic Community Center St. Paul Chamber of Commerce Phyllis Weatley Community Center The Muslim Health Professionals of Minnesota ZACAH (Zakat, Aid & Charity Assisting Humanity)
We need to regroup, reaffirm our core values and work together to continue to build ONE Minnesota. Thank you for your time and consideration in this critical moment. firstname.lastname@example.org