Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-06-28
Dodping the Loan Shark Law.

The Attorney General prefers TO leave
undetermined for the present the question
of the Jurisdiction over the south ap-
proaches to the Highway bridge, which
has been raised in connection with the
establishment there of offices or loan
brokers seeking to evade the law now
operative in the District of Columbia pro-
hbiting the collection of usu'ious inter
est from borrowers. He considers tnat
this question is not sufficiently important
to become the basis of action upon
matter which involves research OF
months and upon which depend possibly
grave issues of law. Perhaps this is a
discreet view i'm the direction of the con-
servation of official energy. although II
leaves open a question that must ulti-
mately be settled. 1t would seem from
one point of view that il is better to de-
termine this matter of jurisdiction in an
unimportant case rather than to wait until
one of vital consequence arises to de-
mand a decision. However that is a
question of opinion which does not meet
the particular point involved in the pres
ent situation.
of course. if the United States has
control over the immediate approaches at
the Virginia end of the Highway bridge
it can Gust the loan brokers from
their present position there. But
they have only to move a few rods back
to be on Virginia soil and there be i'm
mune from federal molestation and in
full enjoyment of the protection of the
Virginia laws, which permit usury in its
most Objectionable forms. The evil in
this matter of the transfer of loan shark
activities in part from the District to
Virginia will not be cured by shifting
of the funds distributing agencies from
the immediate end of the Highway bridge
to the unquestioned soil of Virginia.
little farther inland That will have to be
done by further legislation, making 1t il
legal to maintain in the District of Co
lumbia any establishment. as principal
or as branch, engaged in an Illegal bust
ness however legal that business may
be in an adjoining state.
The loan shark law has already been
declared unconstitutional on technical
ground. in that 1T draws discrimination
between an individual and a corporal ton
in the matter of a District license 1t is
possible that this defect will have to be
cured by further legislation. It will be
to the interest of the people of the Dis
trict who are compelled by circum-
stances to borrow money without security
and who have been heretofore and are
still to some extent victims Of usurers for
Congress to proceed without delay in this
matter, to cure the already discovered
defects OF the law and to strengthen
ii in the matter of its evasion by setting
up establishments In Virginia or Mary
land where loans that are illegal in the
District OF Columbia can be made with
impunity.
1t is nonsense to declare that a law
prohibiting usurious interest taking in
the District of Columbia is a hardship
upon the poor man who needs to bor-
row money. 1t is possible to regulate the
business of money lending so that the
small borrower who has no security to
offer can obtain funds without paying
extortioEate interest. But this cannot
be done as long as money lenders can
by subterfuge or sham removal of their
places for the transaction of business
wholly evade the local law II this
lodging of jurisdiction cannot be cured
by congressional enactment it will be
necessary TO appeal to the states of Mary
land and Virginia for legislation that
will put an end to an evil condition that
affects them as we'll as the District of
Columbia.