The Latest from the Prospect
JUNE 8, 2021
Dayen on TAP
Gottheimer Rakes In Cash From Rent-a-Bank Practitioners He Supports
Yesterday, I wrote about how House Democrat and co-chair of the Problem Solvers Caucus Josh Gottheimer (D-NJ) is trying to block a resolution that would eliminate a Trump-era rule allowing predatory lenders to partner with federally chartered banks to evade state interest-rate caps and charge whatever they want for consumer loans. I noted that Gottheimer is one of Wall Street’s go-to Democrats, and that he’s raised over $6 million from the finance, insurance, and real estate sectors over the course of his short congressional career.

What I didn’t know then is how the small group of companies that specifically use this tactic of laundering loans through banks to charge higher interest rates have funneled support to Gottheimer. I did mention that Opportunity Financial, an online lender that charges 160 percent interest on its loans in 24 states thanks to a partnership with FinWise Bank, gave a total of $1,500 in two installments from its political action committee to Gottheimer in the 2019–2020 election cycle. The CEO of OppLoans, Jared Kaplan, personally gave Gottheimer $500.

But there are more. Joan Kuehl, at the time the CIO of Elevate Credit, contributed $1,300 in the same election cycle. Kate Vanderkolk, a staff attorney for the company, gave $1,250. Elevate Credit is one of the online lenders that has taken advantage of these “rent-a-bank” schemes to charge up to 251 percent interest; D.C. Attorney General Karl Racine sued the company last year.

Another company using rent-a-banks to gouge customers with high-cost loans is Enova International. Matthew Hollender, director of NetCredit at Enova, gave Gottheimer $500 in 2020, and Michael Kerr, an attorney with the firm, gave $350.

This largesse has continued into this year. In just the first quarter of 2021, the only period for which we have current donor information, Christopher Lutes, an executive with Elevate Credit, contributed $1,250 to Gottheimer, and CEO Jason Harvison gave $1,250. Kirk Chartier, an executive with Enova, gave $2,500. And Andrew Pincus, a partner at the D.C. law firm Mayer Brown who works with the U.S. Chamber of Commerce, which is on the same side as Gottheimer on preserving the rent-a-bank rule, gave $500.

That’s a total of $10,400 since 2019 coming from executives who are explicitly using the very rent-a-bank scheme Gottheimer is lobbying to keep alive, and another $500 from a legal ally of the effort. In the grand scheme of Gottheimer’s prodigious fundraising—$7.2 million in the 2020 cycle, and $925,000 in the first quarter of 2021—it’s not that much. But it’s enough to get the attention of a member of Congress, to at least have them know that they should maybe take a meeting and listen to this constituency’s concerns. And Gottheimer is certainly listening.

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