Evening star. [volume] (Washington, D.C.) 1854-1972, 1916-05-15
of transacting business at the interest

of transacting business at the interest
rate provided in the new law.
The Prudential Loan Society Is In
corporated under the laws of Delaware
for the purpose of loaning money on
pledges. Its directors and officers are
principally Philadelphia men. whose
money financed the society. Its Wash
ineton office was opdhed in December,
1909, anu it made loans in the District
of Columbia until August. 1913, since
which time it has loaned no money.
Its offices, however, have been kept
open in the hope that the so-called
1913, might be amended so that 1t
might continue in business here at its
old rates.
No Profit in 1 Per Cent Rate.
THE society's rates for loans on dia-
monds, jewelry and other goods usually
accepted In pledge by pawnbrokers,"
said Mr. Byrne. were 2 per cent g.
month on sums up to and including
SIS; IL per cent month on sums from
SIS to S499, and l per cent month
on sums of $500 and over. These were
the rates charged by the society from
the time it opened it's Washington Of
fees to the time it discontinued the
business of making loans August L.
1913. From the time the present So
called loan shark law was passed, in
y
society made loans at l per cent a
month. regardless of the amount Of the
loan. Since the latter date we have
kept the offices open, but have made no
loans. because we cannot do business
without loss at l per cent month,
which is all the present law allows"
Mr. Byrne asserted that when the
society which he represents opened Of
fees in Rochester, n. Y. pawnbrokers
were charging 10 per cent a month. or
90 a o.
rate being 10 per cent. The same was
true in Buffalo, when the society opened
offices there. In both places the So
ciety charging it's maximum rate of 2
per cent month on small loans, com
PEELED the other pawnbrokers either to
reduce their rates to correspond or to
go out of business.
Reductions Without Legislation.
''In Pittsburgh, when the society opened
offices there. pawnbrokers were permitted
with per cent for storage, or a total of
So per cent a month. Our rates of per
cent for spall loans compelled a reduc-
ton of theNpawnbrokers' rate. In every
case the reductions were brought about
without any legislation whatever
Mr.. Byrne asserted that the experience
of the Prudential Loan Society is that a
reasonable profit may be made when in
terest at the rate of 2 per cent a month
is permitted on small loans. but that a
lower rate of interest is impossible
if the organization is to earn reasonable
return on it's money, pay necessary ex-
penses, etc. The lower rates previously
charged were on larger loans, running up
to more than $500, and as the present law
limits loans to 5000 the business cannot
be done without loss at less than per
cent per month on all.
Opening it's Washington offices in De-
cember 1909. the first months business
of the Prudential Loan Society amounted
to s3,,59s. It's business for the four months
Immediately preceding August /. 1913. on
which date it discontinued loaning money
here. was as follows: April. s16.3S3 so:
May, s26.15550; June. s2s, 440; July. $751;
22650
The society does not want to charge 3
per cent per month. as Washington pawn
brokers operating outside of the District
of Columbia are now DOING said Mr.
Byrne. "All it wants is that Congress
shall so amend the present law governing
interest rates on collateral loans as to
permit the charging of a maximum of 2
per cent month on small loans"