Payday industry advocates threaten fines, jail time in letters sent to KC clergy - Word&Way

Payday industry advocates threaten fines, jail time in letters sent to KC clergy

KANSAS CITY — A group opposed to a ballot initiative to reform short-term consumer lending in Missouri apparently hopes the threat of fines or jail time might cause faith-based groups, particularly houses of worship, to back away.

Anthony & Middlebrook, a law firm in Grapevine, Texas, issued a legal notice to several clergypersons in the Kansas City area on behalf of Missourians for Equal Credit Opportunity ( That group opposes the petition Missourians for Responsible Lending ( is currently circulating to get an initiative on the November ballot.

Missourians for Equal Credit Opportunity, backed by the so-called payday loan industry, believes the ballot initiative, if passed, would eliminate small, short-term loans in the state and "drive borrowers to more expensive and credit-damaging alternatives such as bounced check and late bill payment penalty fees," according to the letter.

The legal firm charged that proponents of the measure make "misleading claims," and "are suggesting that their rate cap is a matter of 'faith' and are targeting certain non-profit groups, charities and churches to carry their message."

In its letter, the law firm claims faith-based groups that circulate the petition to collect signatures could be in legal trouble in two ways. Those who circulate a petition "knowing it to be false" could be guilty of a Class A misdemeanor, punishable by up to a year in jail and a $10,000 fine.

The firm also suggested participating churches could be engaging in political activity that might subject them to campaign finance reporting laws, which might cause them to lose their tax-exempt status.

The letter noted Missourians for Equal Credit Opportunity "will monitor closely for compliance…and will promptly report any violations…."

No one affiliated with the firm actually signed the letter, only as "Anthony & Middlebrook, P.C." The letter concluded with the line "Paid for by Missourians for Equal Credit Opportunity, James Thomas, Treasurer."

Several clergy received the letter, dated Jan. 10, on Jan. 12, the same day many gathered in Jefferson City to visit legislators.

In a response sent to clergy partners, Kansas City-based Communities Creating Opportunity, which is spearheading the Missourians for Responsible Lending effort, emphasized that churches and other religious organizations may support a ballot measure without risk to tax-exempt status, "as long as a substantial part of their overall activities is not attempting to influence legislation, including ballot measures."

CCO Executive Director Eva Schulte, author of the response, also noted the law would require not-for-profits to file disclosure reports with the state ethics commission if they spend more than $500 in public support or $2,000 on internal communication in support of a ballot measure.

"Support for lower interest rates is consistent with the historical and long-accepted practice of congregations seeking to protect the poor and vulnerable in their neighborhoods, the same as speaking against drug activity and the proliferation of liquor stores," Schulte wrote.