Following a series of public hearings on issues raised in The Buffalo News series "The High Cost of Being Poor," lawmakers are promising to address financial abuses against low-income New Yorkers next year.
"We have found pervasive problems that are overwhelmingly felt in poorer households," said Darryl C. Towns, D-Brooklyn, chairman of the Assembly Banks Committee .
Towns and Assemblywoman Audrey I. Pheffer, D-Queens, who heads the Consumer Affairs and Protection Committee, held hearings in September and October in Buffalo and New York City.
The hearings were convened to address The News' series that explored how low-income people without cash or credit pay extra fees to cash checks, get short-term loans, buy furniture, appliances and electronics, borrow money for a house or car and get insurance.
Legislative approval would require support in the Republican-controlled State Senate, where Republicans have not voiced a position. Neither Senate Majority Leader Joseph L. Bruno nor Sen. Dale M. Volker, R-Depew, returned calls seeking comment.
But Assembly Democrats say they are hopeful they can get reforms enacted.
"We're going to be able to show [Senate Republicans] that there is a definite problem," Pheffer said.
Meanwhile, incoming State Attorney General Andrew M. Cuomo, who brought more than 2,000 anti-discrimination cases as head of the federal Department of Housing and Urban Development and who led a task force against predatory lending, said he will target such abuses in his new role. He is also concerned about rent-to-own and insurance prices and illegal check-cashing.
Assemblywoman Crystal D. Peoples, D-Buffalo, who hosted the Assembly's hearing in Buffalo, wants to limit fees and interest charged by financial services businesses, fund research on questionable practices and create strong penalties for violations. She also wants to increase state funding for legal services agencies that serve the poor.
State Sen.-elect Antoine M. Thompson, D-Buffalo, who has been representing the Masten District on the Common Council, said he hopes to address what he calls a lack of adequate banking services in Buffalo, as well as the difficulty some city homeowners have in getting insurance.
On unlicensed check-cashing, Towns said lawmakers will look to the superintendent of banking for remedies but would consider adding to the department's budget if more staff is needed to stop violations.
"Enforcement is probably the greater issue there," he said.
He stressed, though, that it's not all about new rules and enforcement, but also includes financial education.
Even so, he said, rates and terms in the subprime market -- for borrowers with weak credit -- should "line up more" with the prime market. He also wants limits on how much rent-to-own stores can charge.
-- Jonathan D. Epstein