Evening star. [volume] (Washington, D.C.) 1854-1972, 1911-08-04
]. D. LEONARD ANSWERS
REMARKS OF POMERENE
Declares Criticisms of Ohio
Senator Regarding "Loan
Sharks" Unjust.

| Answering criticisms Of him by Senator
| Pomerene Of Ohio in the Senate recently.
| J. D. Leonard, president OF the League
| Of Remedial Loan Companies Of the Dis
trict Of Columbia, in an open letter de-
clares that the Ohio senator was unjust"
that at did not suit your purpose to
refer to some information furnished him
and that his attitude "smacks rather of
what might be expected Of the car of
all the Russians
In the course of speech on the loan
| shark bill now before the Senate, Sena-
tor Pomerene opposed the rate of liz
per cent per month as proposed in the
bill and presented to the Senate and had
read a Ietter.to use Mr.. Pomerene's own
words-''to present the position which is
taken BY some of the loan sharks Of the
District in order that we may we'll COM
prehend their position and their greed"
1t was letter from Mr.. Leonard urging
8 per cent per month rate as proper
ma ximum rate to be fixed in the pro-
posed law.
Mr.. Leonard in his letter to Mr. Pome-
rene said:
"In doing all this (sending letter and
Information to Mr.. Pomerene) be-
lieved then and I believe now that
was acting entirely within my
rights as citizen of the District Of Co
h1mbia. I have always believed that it
was the prerogative of all citizens to eX-
ercise the right of petition and respectful
free speech, and did. l confess, belleve
that you were animated by fair and I'M
formation along the lines Of your in
cestigation. 1t would seem, however,
that 1 was mistaken
Resents Being Called "Loan Shark"
Mr.. Leonard, too, resents the implica-
ton of Senator Pomerene that he is
loan shark" and condemns those he.
considers loan sharks" in unmistakable
terms.
Mr.. Leonard comments that in the dis
cussion of the loan shark" bill several
senators showed themselves "woefully
uniformed on the subject of the usury
section in the local code, as also the
pawnbrokers' act"
You may recall" says Mr.. Leonard
that ] suggested in my letter that mas
much as the Congress of the United
States had by law permitted the pawn
brokers of the District of Columbia to
charge per cent a month on pledges of
diamonds and je;velry that 1t would seem
but just to exterd the application of said
law to the loan companies. whose hazard
of loss was irsmeasurably greater and
a report, No. 335, Senate Calendar $40.
March 7, 1910, to accompany Senate bill
1903 regulating loan compan1es) the fol-
lowing statement is made:
1.-THE reasons which justify pawn
brokers in charging such rates of in
tereSt upon loans made upon pledged
articles also seem to justify lenders of
small sums of money without pledge
in also demanding and receiving similar
rates. 1t is noted that many senators
% Inha
the pawnbrokers' law Of the District
of Columbia as providing rate of 2
per cent month. leaving the inference
that the loan companies should not
be allowed more. Perhaps when they
learn that the pawnbrokers are allowed
per cent a month they will agree that
the loan companies should not be given
less"
Two Per Cent insufficient.
Mr1eonard says that with the letter
which Senator Pomerene had read he
furnished a sworn statement of one
member of the League of Remedial
Loan Companies showing their profits
and showing that under 2 per cent
law last year the company could not
have paid dividends.
Summarizing the position toward loan
shark legislation. Mr.. Leonard says in
the conclusion Of his letter:
We have in Washington approxima tely
100 loan companies or individuals engag-
ed in the business OF money lending in ex-
cess of the code rates. with an aggre-
gate capital in use of say S2,OOo,OO1 OF
this 100000 considerably less than
100000 is loaned at monthly rate of =
per cent; perhaps $4,000 brings an aver
age rate of 21a per cent, and approximate
1y $4,000 is loaned at 3 per cent, and the
remaining S1,5Oo,OOO. it is believed, is
placed at rates ranging from 5 per cent
a month upward.
Now it is clear that the hardship said
to be complained of by local borrowers is
properly and justly charged, first, TO the
hish-rate men, add then in corresponding
degree down the line until the low-rate
men are reached, hence, 1t is also clear
that If we begin the reformb legislation at
the top by some reasonable measure,
such as applying the pawnbrokers' law to
the loan mpanies, relief to approximate
ly $150O,oOo worth of borrowers would re-
suit Immediately