Senator Scott Surovell (D-Mount Vernon)’s bill, SB 1126, which aims to regulate consumer finance companies that operate over the internet, passed the Senate on Tuesday with broad, bipartisan support on a 36-3 vote.
The bill provides that the laws regulating consumer finance companies apply to persons making loans to individuals for personal, family, household, or other nonbusiness purposes over the Internet to Virginia residents or any individuals in Virginia, whether or not the person making the loans maintains a physical presence in the Commonwealth.
Said Senator Surovell, “This legislation would require companies that lend money over the internet to be regulated as consumer finance companies. It also mandates the development of a regulatory regime to deal with these companies. This is a very real problem. What we are seeing is foreign companies coming in to Virginia, lending at interest rates of 478%, 638%, even 5,000%.”
Said Senator Rosalyn Dance (D-Petersburg), “I was proud to vote for this bill in committee and I was proud to stand with my colleagues and support it on the Senate floor. Too many of our constituents are falling prey to these online predatory loan schemes and the onus is on us to act. People are lured into these scams with false advertising and hidden clauses, and in the blink of an eye they owe five times more than they borrowed in the first place. This is about protecting Virginia families and I am proud that we were able to work together to move this initiative through the Senate.”
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