[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1389 Introduced in Senate (IS)]
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116th CONGRESS
1st Session
S. 1389
To protect consumers from usury.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 9, 2019
Mr. Sanders (for himself and Mr. Whitehouse) introduced the following
bill; which was read twice and referred to the Committee on Banking,
Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To protect consumers from usury.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Loan Shark Prevention Act''.
SEC. 2. INTEREST RATE REDUCTION.
(a) National Consumer Credit Usury Rate.--Section 107 of the Truth
in Lending Act (15 U.S.C. 1606) is amended by adding at the end the
following new subsection:
``(f) National Consumer Credit Usury Rate.--
``(1) Limitation established.--
``(A) In general.--Notwithstanding subsection (a)
or any other provision of law, but except as provided
in paragraph (2), the annual percentage rate applicable
to any extension of credit may not exceed the lesser
of--
``(i) 15 percent on unpaid balances,
inclusive of all finance charges; or
``(ii) the maximum rate permitted by the
laws of the State in which the consumer
resides.
``(B) Other fees.--Any fees that are not considered
finance charges under section 106(a) may not be used to
evade the limitations of this paragraph, and the total
sum of such fees may not exceed the total amount of
finance charges assessed.
``(2) Exceptions.--
``(A) Board authority.--The Board may establish,
after consultation with the appropriate committees of
Congress, the Secretary of the Treasury, and any other
interested Federal financial institution regulatory
agency, an annual percentage rate of interest ceiling
exceeding the 15-percent annual rate under paragraph
(1) for periods of not to exceed 18 months, upon a
determination that--
``(i) money market interest rates have
risen over the preceding 6-month period; and
``(ii) prevailing interest rate levels
threaten the safety and soundness of individual
lenders, as evidenced by adverse trends in
liquidity, capital, earnings, and growth.
``(B) Treatment of credit unions.--The limitation
in paragraph (1) does not apply with respect to any
extension of credit by an insured credit union, as that
term is defined in section 101 of the Federal Credit
Union Act (12 U.S.C. 1752).
``(3) Penalties for charging higher rates.--
``(A) Violation.--The taking, receiving, reserving,
or charging of an annual percentage rate or fee greater
than that permitted by paragraph (1), when knowingly
done, shall be deemed a violation of this title, and a
forfeiture of the entire interest which the note, bill,
or other evidence of the obligation carries with it, or
which has been agreed to be paid thereon.
``(B) Refund of interest amounts.--If an annual
percentage rate or fee greater than that permitted
under paragraph (1) has been paid, the person by whom
it has been paid, or the legal representative thereof,
may, by bringing an action not later than 2 years after
the date on which the usurious collection was last
made, recover back from the lender in an action in the
nature of an action of debt, the entire amount of
interest, finance charges, or fees paid.
``(4) Civil liability.--Any creditor who violates this
subsection shall be subject to the provisions of section 130.
``(g) Relation to State Law.--Nothing in this section may be
construed to preempt any provision of State law that provides greater
protection to consumers than is provided in this section.''.
(b) Civil Liability Conforming Amendment.--Section 130(a) of the
Truth in Lending Act (15 U.S.C. 1640(a)) is amended by inserting
``section 107(f),'' before ``this chapter''.
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