Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-05-06
SUPPRESSION OF USURY
BILLS CONSIDERED BY A SEN
ATE SUBCoMMITTEE.
Proposed Regulation Of the Leaning
on Small Amounts at High
Rates of Interest.

nearing tnlS morning III TIE DiStiiS'
committee room on bills to suppress
usury in the District and to regulate the
lbaning of money The members of the
subcommittee. Senators Dillingham; Long
Johnston and Paynter were all present
Three bills were under consideration. all
OF which were introduced by Senator
GaHinger. one being the Commissioners
bill to license individuals and firms doing
q loan business. and otherwise regulating
such business. and the other two being
for the purpose of making usury Grim
inal offense.
Mr.. Gallinger stated that in his opinion
there should he some legislation to pre-
vent wrongs now being perpetrated upon
poor and ignorant people by loan COM
NAMES in the District, which charged eX-
horbitant rates of interest. Commits
sioner Mcfarland spoke especially in
favor of the Commissioners bill.
In the course of his remarks Senator
Gallinger declared that if the books of
some of the loan companies of this city
should be opened and inspected by the
subcommittee there might be some star
Ting disclosures.
Mrs. Charlotte E. Hopkins who lives at
1928 Massachusetts avenue northwest
and Is interested in philanthropic work In
the city. spoke in favor of a bill making
nsury crime She cited three cases that
had come within her personal notice or
tremendous exactions'' of interest by
loan companies. Conditions In other
cities. tending to Substantial the argu-
ments in favor of some usury Legislation
Of this kind in the District, were cited by
p G. Rapp of 1904 Girard street. who is
AmpIoyed in the government printing
ONCE: Rev.. E. Irome. who lives at SO
D street northwest, spoke along the
same line.
Usury Bills Opposed.
: The two bills making usury crime
were opposed by c. c. Tucker. an at
torney representing a local loaning house.
He declared that if these bills were en-
acted into law all of the loan companies
charging high rates of interest would be
driven out of business and persons in
pressing need of money and without the
best securities would be unable to get
relief. He favored the enactment of the
Commissioners bill with one or two minor
amendments. in no way affecting its pur-
pose. In reply TO question by mem
Der of the committee he declared that
personally he believed , per cent a
tmonth was a reasonable interest for a
small amount on the usual collateral &C
cepted by these companies.
Senator Gallinger asked how much in
terest was charged by his client. and Mr..
Tucker replied that ne charged per cent
q month in his pawnbroking business,
but he did not know how much he
charged on his other loan business.
Mr.. Tucker further asserted that there
Us legal release for persons imposed upon
I by loan companies. He said these persons
can go into court and recover not only
the usurious interest. but all the interest
when they have been charged more than
8 per cent per annum.
Ex-senator Thurston, representing 9TH
.ers took the position assumed by Mr..
fucker with reference to bills making
usury crime in the District, and he
also criticised adversely the Commits
sioners' bill for regulation of usury.
Members of the subcommittee asked him
for suggestions as to the faults of this
measure, and--he declared that in his
opinion the tax of $1,000 per year pro-
.vided in the bill would work a hardship
on the poor people of the District, be-
cause they would. of course. have to pay
1t In the shape of higher rates of inter-
present. form requires license of a man
engaged in the business of loaning his
own money on real estate. which he de-
.clared to be manifestly unjust
: Senator Johnson suggested that there
might be added to the list of exceptions in
the bill all those loaning money at per
cent per annum or less.
Remedy in the Courts.
Senator Gallinger called attention to the
fact that the District is unique among
cities of the country on account of the
large number of government employees
living here. He also said that the rem
edy of recovering interest suggested by
Mr.. Tucker was not really remedy be-
cause many ignorant people did not know
of 1t and many other borrowers were I'M
willing to air their affairs.
1t was suggested by Senator Rayner
that If these loan companies were driven
out OF business people might be induced
TO save their money for eXigencies and
great good might be accomplished there
by.
In reply to Mr. Gallinger Mr.. Thurston
said that the District is different from
OF
employees but he asserted these employees
receive a much higher salary than is
received by the same class of workers
In any other city in<-the country. and, he
said if they fall intolthe hands of usurers
knowing. they do. the consequences.
they deserve no pity from any one
Position of Commissioners.
After Senator Gallinger had stated the
question in general Commissioner Mac
farland announced the position of the
Commissioners. The Commissioners, he
said. had had so many complaints. and
at hearings learned so much of the ex-
tortionate character of some of this bust
ness. that for years they had been recon-
mending legislation to regulate and i'm
prove it. Since he became Commissioner
in 1900 this had been pressed at every
session. and at the present session the
Commissioners had recommended legis-
lation giving them supervision. providing
TOT a license TAX. I0F reSlStratiOn, for the
keeping of books subject to the inspection
of the Commissioners or their agents. and
for the hearing by the Commissioners of
protests and complaints. with power TO
revoke licenses, and also for penalty
against usUry- The hearing last month
before the Commissioners had showed
that the business was great and grow
ing. involving between half a million and
million and a half dollars of capital
and between seventy-five and 100 lending
concerns and individuals, and that they
were inviting borrowers by advertising
and circulars TO a great extent The
money lenders of the better class he
said. favored supervision although ali on
posed penalties for usury or other similar
legislation. Certainly, he commended Con
gress should regulate the matters nv Ia w
in the interest especially of the poor and
ignorant, who were not able To fefepd
themselves from oppression and exaction
and who were being invited Ito horrou
money.
Commissioner West who was nresent
AZ the nearing. made statement favor
ing the enactment of some sort of lepis
Iation to protect needy persons seeking
loans. lie thought the Commissioners
OIL good measure. but said that the
$@o license was only tentative and
might be reduced and leave the bill sat
isfactOry.
The subcommittee reached no conc,u-
sion but will consider the matter further
before reporting to the full committees
ROBERT HENRY PAYNE DEAD.