Loan Industry

Two former directors of failed Delta Savings Bank have won a rare victory against federal thrift regulators as a judge found that the government failed to prove that the directors caused any of Delta's losses or knowingly violated any laws. The directors--Michael Kim and Young Il Kim, who are unrelated--do not have to pay restitution for any loss at the Westminster thrift, and are not barred from the savings and loan industry, according to a decision by Administrative Law Judge Arthur L. Shipe.

Sen. Christopher J. Dodd (D-Conn.), who has won praise from consumer groups for taking on credit card providers over predatory lending practices, has collected thousands of dollars in donations from people affiliated with the so-called payday loan industry. The lawmaker raised more than $44,000 from pawnshop owners and other businesses that provide high-interest loans, often to people with bad credit ratings, according to campaign finance reports. The amount, a fraction of the $1.

Beverly Hills Savings and Loan, based in Mission Viejo, has named Debbie Miede vice president and corporate counsel. Miede, a resident of Capistrano Beach, had previously worked at a law firm where she specialized in the savings and loan industry.

I recently returned from a boat tour in Indonesia and was impressed by the quality of the service provided by the tour company. The employees went out of their way to make the experience a pleasurable one for the customers. Other tour companies we have used in the past were equally good. My impressions are consistent with those of many other travelers with whom I have compared notes.

"The industry is a dinosaur. The only real question is when, not if, it is going to be folded into the banking industry." --Robert Litan of the Brookings Institution, on the future of the savings and loan industry.

Although there are a lot of wolves in the real estate loan industry, Jamaal Wilkes Home Loans is a reputable and professional mortgage brokerage company that provides a service with commitment and conscience. We are interested in doing homeownership seminars, including the pitfalls of real estate loan rip-offs and scams, to your constituency as a community service. JAMAAL WILKES Jamaal Wilkes Home Loans

Jay Janis, the nation's top savings and loan regulator in the Carter Administration and most recently the head of the trade group representing California's thrifts, died Monday night in UCLA Medical Center after a long bout with leukemia. He was 59. A popular figure in the state's savings and loan industry, the Bel-Air resident had served since Jan. 1 as president of the California League of Savings Institutions.

The lingering political power of some elements of the savings and loan industry was demonstrated crudely in the House Judiciary Committee the other day when opponents of tough new capital requirements came within a single vote of wrecking President Bush's bailout plan, and a majority supported watered-down penalties for fraud. This served as a warning of the battle that lies ahead when the legislation reaches the floor of the House next month. It also served as a reminder of the continuing influence of the savings and loan industry over Congress, an influence effectively used over the years to extract outrageous concessions that facilitated the financial crisis now culminating in the $150-billion bailout.

Assemblyman Tom Bane (D-Tarzana), a longtime champion of the savings and loan industry, received $513,000 in campaign contributions from thrifts--more than any other state legislator in the 1980s, according to a survey by two public-interest groups. In all, the survey said, savings and loans in the last decade contributed $4.1 million to state lawmakers, including at least $216,000 to Assembly Speaker Willie Brown (D-San Francisco), $214,000 to Senate President Pro Tem David A.

Brad Cottrell was a paramedic when a friend introduced him to the high-rolling world of sub-prime mortgage lending. Within three years of landing a job with Ownit Mortgage Solutions Inc. in Agoura Hills, his salary had tripled. His wife quit working and they bought a 3,000-square-foot house in Camarillo. But late last year, defaults on risky loans began to rise. By December, Ownit was out of business, and the 35-year-old father of three was out of a job. "It was a nightmare," he said.

Soft music plays in the background of a new TV ad campaign as it urges viewers to use payday loans only for emergencies. One scene shows a broken-down car. Another depicts a young boy in a doctor's office, his arm in a sling. "Please borrow only what you feel comfortable paying back when it's due," says Darrin Andersen, president of the Community Financial Services Assn. A new emblem will tell borrowers which lenders meet his trade group's requirements, Andersen says in the ad.

Today the state Assembly's Banking and Finance Committee will vote on whether to limit the amount that payday lenders can charge on loans--a reduction that would still allow them an astounding annual interest rate of 150%. Even so, SB 898, sponsored by Sen. Don Perata (D-Alameda), should be approved because it's a vast improvement over current rates, which now average 500%. Lobbyists for the lucrative payday loan industry say the Perata bill would drive them out of business.

Two of the most far-reaching consumer protection measures in the Capitol this year--bills to combat identity theft and to rein in the "payday loan" industry--met a sudden death Tuesday amid vigorous opposition from business lobbyists. Both were killed in a matter of minutes by the Assembly's Banking and Finance Committee. Considered the linchpin of efforts to combat identity theft in California this year, legislation by Sen.

Supporters call it a last resort that rescues working people in sudden need of cash. Opponents call it a legal loan-sharking operation that entangles poor people in an endless web of debt. It is the "payday loan" industry, a fast-growing offshoot of the check-cashing business that is exempt from usury laws and provides advance money to its customers at annualized interest rates as high as 911%.

Orange County's dwindling savings and loan industry, pushing low-starting adjustable rate mortgages while interest rates in general rose last year, needed its two biggest thrifts to help it record combined annual earnings of $240.6 million. Without American Savings Bank in Irvine and Household Bank in Newport Beach, the county's 11 other S&Ls would have posted a combined loss of $10 million last year.

For a few, brief moments I thought I might have voted for the wrong candidate in November. Then, our new President, exhibiting the high moral and ethical tone he wants his Administration to set, said that deposits in savings and loan associations "are backed by the full faith and credit of the government, and they are sound, they are good." Then, to prove that he meant what he said, Bush added that he found nothing wrong with considering having depositors foot the bill for bailing out the savings and loan industry.

The American public's confidence in the savings and loan industry has eroded sharply in recent months, and while only a handful say they have been directly affected by the S&L crisis, most believe that higher taxes are inevitable to pay for the industry's cleanup, according to a Washington Post-ABC News poll. Only 27% of those interviewed said they had a great deal or a good amount of confidence in the savings and loan industry--down from 44% in March, 1989.

Like many other California savings and loans, Independence One pointedly began calling itself a "bank" a few years ago because it was embarrassed by the chaotic state of the thrift industry. Now Independence One Bank is proposing something far more radical: It wants to become a commercial bank because it is no longer able to compete in the home loan business.

Although there are a lot of wolves in the real estate loan industry, Jamaal Wilkes Home Loans is a reputable and professional mortgage brokerage company that provides a service with commitment and conscience. We are interested in doing homeownership seminars, including the pitfalls of real estate loan rip-offs and scams, to your constituency as a community service. JAMAAL WILKES Jamaal Wilkes Home Loans