Payday Loan Times

Republican state Senate candidate Don Stout called it "ridiculous and hypocritical" for state Sen. Lowell Barron to lead a reform effort against payday loan operations … when Barron himself owned more than 20 outlets until recently.

Barron, D-Fyffe, responded that Stout should stop the personal attacks and focus more on his own plans if elected, according to The Huntsville Times.

Stout leveled his charges Wednesday in a news conference at the Madison County Republican headquarters. The Senate district encompasses Jackson and DeKalb counties and eastern portions of Madison County.

He said Barron should "come clean" by proving that he's completely out of the quick payday advance business. Stout challenged Barron to reimburse borrowers the high interest he charged while in the business.

"Since he's had a Damascus road experience, apparently, I think he ought to return the money he's taken from them over the years," said Stout.

Barron, meanwhile, issued a statement restating his reform plan and asking Stout to back off.

"My opponent's entire campaign has been negative personal attacks on me with no plan for what he would do as senator," Barron said. "My plan to reform the payday loan industry is public, and I am proud that it has been endorsed by newspapers as well as leading consumer advocacy groups in the state."

Payday loan back story: The news conference followed Barron's announcement last week that he had sold his interest in faxless payday loan businesses and now plans to reform the industry.

Barron is drafting bills that would outlaw so-called rollover loans that can quickly rack up hefty interest charges, ban payday advance providers from operating within five miles of a military base, forbid lenders from garnishing any military wages, and prohibit the seizure of personal property on bad loans made by quick-cash outlets.

Stout said Barron profited from payday loan outlets for years and once helped "sabotage" state legislation that would have imposed tighter sanctions on the industry.

Two officials with Alabama Arise, an advocacy group for the poor, said last week that Barron used his influence as president pro tem of the Senate in 2003 to water down payday loan reform bill on payday loans that had been passed by the House.

The substitute made policing rollover loans more difficult by weakening a central database requirement that would have kept tabs on the borrowing frequency of payday loan customers, Arise officials said.

"Lowell Barron had an opportunity to stop unfair loan sharking operations, the very ones he now suddenly wants to shut down," Stout said.

Stout said he would "eagerly" support strict reforms of the faxless payday advance industry and would back an effort to outlaw them as Georgia has done. Stout called on victims of payday loan outlets to contact him with their experiences. He said his top issues are improving education, implementing legislative term limits and being open and honest with all his dealings.

Wednesday's news conference followed recent Stout radio ads attacking Barron on the payday cash loan issue. The ads, plus the presence of a Montgomery-based political consultant at the news conference, are signs that money and other campaign resources are beginning to flow into Stout's camp in an election season in which Republicans are hoping to pick up seats in the Democratic-controlled state Senate.

Barron reported $711,000 in his campaign account heading into the 2006 election season. Stout hasn't filed a disclosure report but said he's pleased with the help he's gotten from the state Republican Party.

"They've been very generous," he said. He declined to give an amount but said an effective campaign will cost $300,000.