Patrick McHenry

Congressman Patrick McHenry

Campaign for Accountability, a Washington, DC nonprofit watchdog, filed a formal request last week with the Office of Congressional Ethics calling for an investigation of 11 members of Congress of both parties, including North Carolina Congressman Patrick McHenry. The subject: their ties to the predatory payday lending industry.

Here is the news release that accompanied the request:

CfA Files Ethics Complaint Against 11 Members of Congress Alleging Collusion with Payday Loan Industry

Washington, DC – Today, Campaign for Accountability (CfA) asked the Office of Congressional Ethics to investigate 11 members of Congress for possible criminal and ethics violations by accepting contributions from the payday lending industry shortly before or after taking official actions in support of the industry.

Those named in the complaint include: Rep. Stephen Fincher (R-TN), Rep. Scott Garrett (R-NJ), Rep. Alcee Hastings (D-FL), Rep. Jeb Hensarling (R-TX), Rep. Blaine Luetkemeyer (R-MO), Rep. Patrick McHenry (R-NC), Rep. Gregory Meeks (D-NY), Rep. Randy Neugebauer (R-TX), Rep. Pete Sessions (R-TX), Rep. Steve Stivers (R-OH), and Rep. Kevin Yoder (R-KS).

CfA Executive Director Anne Weismann stated, “It seems payday loans taken out by their constituents helped fund big paydays for members of Congress who used their positions to advocate on behalf of this unscrupulous industry.”

CfA’s request follows a report issued last week by Allied Progress that outlined actions taken by the representatives to aid payday lenders – including sponsoring legislation to limit oversight of the industry – either shortly before or after they received campaign and/or PAC contributions. CfA alleges this conduct may violate criminal laws regarding bribery, illegal gratuities and honest services fraud, as well as House rules prohibiting members from engaging in official action in return for campaign contributions.

At least seven of these members, for example, received contributions from the industry proximate in time to signing onto an August 22, 2013 letter to then-Attorney General Eric Holder and FDIC Chair Martin J. Gruenberg complaining about the Department of Justice’s “Operation Choke Point,” which payday lenders opposed.

Ms. Weismann continued, “The Office of Congressional Ethics should immediately investigate whether these members of Congress were abusing the public trust by carrying the water of the payday lending industry in exchange for contributions. Once again, it appears that the public good has been sacrificed at the alter of high dollar donors. This is exactly the sort of pay-to-play scheme that leaves Americans so disheartened about the state of our government.”

According to the report that helped spur the complaint (“Cheaper by the Dozen: How Twelve members of Congress Were Showered with Campaign Cash Just by Payday Lenders Just Before and Soon After Taking Official Actions to Benefit the Industry”), McHenry received $94,199 in campaign contributions from payday lenders from 2011-15 and took thousands in the weeks before signing an August 2013 letter to Attorney General Eric Holder questioning a Department of Justice initiative designed to crack down on unscrupulous lenders.

We’ll keep you apprised of developments in this matter as they arise. Stay tuned.


Payday loansPayday lenders (and other short-term lenders) along with their trade associations have spent more than $13 million on lobbying and campaign donations since 2013, according to a new report put out by the Americans for Financial Reform (AFR).

The report is particularly troubling because it comes at a time when the government is finally beginning to crack down on “quick-fix” lenders, who are known for trapping vulnerable cash-strapped borrowers in cycles of debt by charging obscenely high fees in exchange for an immediate payout. The Consumer Financial Protection Bureau is expected to announce a set of rules next year that could bring dramatic changes to the payday lending market. Additionally, the Department of Justice has been zeroing in on banks and payment processors that knowingly facilitate fraud. The only enforcement action brought by the Justice Department in this operation (known as “Operation Choke Point”) so far has been in North Carolina. The Four Oaks Bank & Trust of North Carolina in collaboration with a Texas-based payments company was found to have processed around $2.4 billion in illegal transactions including those benefiting payday lenders. Read More

Lunch Links

Lunch sandwichHappy Friday, campers! With the dog days of summer going full steam, we’re sure a lot of you are staying at your computers these days rather than venturing out in the mid-day humidity. So, as a service to our desk-bound, PB&J-consuming audience, The Progressive Pulse is happy to announce the return of Lunch Links – a daily dose of quick takes that will connect you to the important, the aggravating and the entertaining. Enjoy!

We’ll begin with North Carolina House Speaker Thom Tillis. One of the Triangle’s most intrepid journalists, Kirk Ross over at the Carolina Mercury, has the first thorough review of the wannabe U.S. Senator’s new campaign finance report in a story entitled “Speaker’s Senate fundraising raises questions.”

And speaking of prominent state officials pondering higher office, Attorney General Roy Cooper’s new activism in opposition to the voter suppression bill passed by the General Assembly is sparking speculation that Cooper is cranking up a 2016 challenge to Pat McCrory. If it’s true, Cooper would seem likely to be a formidable candidate.

And speaking of the current Guv, Read More