Professor Creola Johnson gives congressional testimony to Financial Services Committee
An expert in bankruptcy and lending, Professor Creola Johnson presented her testimony on payday lenders to the Financial Services Committee on February 5. Johnson, the first to publish a law review article, Payday Loans: Shrewd Business or Predatory Lending?, about the payday lending industry, believes payday lending is predatory and will only become more harmful if legitimized on a national level.
The hearing, “Rent-A-Bank Schemes and New Debt Traps: Assessing Efforts to Evade State Consumer Protections and Interest Rate Caps,” featured Johnson alongside four other panelists.
“Rent-a-bank schemes are a part of keeping consumers in the dark,” she said. “Rent-a-bank schemes allow non-bank lenders to get away with charging triple-digit and quadruple-digit interest rates and not only that, but keep consumers on the hook. I call them ‘debt entrapment practices.'”