[Plura-list] Guess who's doing a usury in Iowa

Sat Apr 24 10:49:39 EDT 2021

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

Next Tuesday, I'm helping Bruce Sterling launch "Robot Artists & Black
Swans," a book of sf short stories in the Italian "fantascienza" mode,
at Austin's Book People!

https://www.bookpeople.com/event/virtual-event-bruce-sterling-robot-artists-black-swans

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

Today's links

* Guess who's doing a usury in Iowa: When your exercise bike is actually
a predatory lender.

* This day in history: 2006, 2011, 2016, 2020

* Colophon: Recent publications, upcoming/recent appearances, current
writing projects, current reading

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

🎩 Guess who's doing a usury in Iowa

Iowa's HSB 272 ("An Act relating to tax collection and penalties, tax
permits and loans made by state-chartered banks") is the kind of
bureaucratic maneuver Woody Guthrie's meant with, "Some will rob you
with a six-gun, and some with a fountain pen."

https://www.legis.iowa.gov/legislation/BillBook?ga=89&ba=HSB272

On its face, the bill is a completely ordinary piece of tax-code
cleanup, purging some superannuated rules and consolidating others. But
as Iowa law prof Chris Odinet writes for Credit Slips, there's a clever
gotcha hidden in that bloodless language.

https://www.creditslips.org/creditslips/2021/04/of-usury-preemption-and-fancy-stationary-bikes.html

Here's where the knife slips in: "The general assembly of Iowa hereby
declares… it does not want any of the provisions of any of the
amendments contained in Public Law No. 96-221 (94 stat. 132), sections
521, 522 and 523 to apply with respect to loans made in this state…"

Eliminating Sec 521 means that out-of-state banks chartered by the FDIC
would no longer be bound by Iowa's usury laws. That opens the door to
"partnerships between a handful of state-chartered banks and so-called
'fintech' nonbank lenders making triple digit loans."

As the Trashfuture folks like to remind us, any time you read the word
"fintech," substitute "unregulated bank."

And as Odinet writes, this rent-a-bank scheme has led to "unique legal
and policy problems."

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3677283

So far, so normal: corruption buried in an obscure tax-bill. But then it
gets weird. It turns out that this maneuver to legalize loan-sharking in
Iowa is the result of lobbying by…Peloton! (yes, *that* Peleton!).

Peleton makes a luxury "smart" exercise bike and many people who want to
own such a thing can't afford it, so Peleton has partnered with a
fintech company called Affirm, which finances the $3k needed to buy a
Peleton bike.

And Affirm is a predatory lender. While it advertises "0% down, 0% APR,
0% hidden fees," its website offers this warning (in 10.5 point
grey-on-white type):

"Your rate will be 0–30% APR based on credit, and is subject to an
eligibility check. Options depend on your purchase amount, and a down
payment may be required…Affirm Plus financing is provided by Celtic
Bank, Member FDIC."

https://www.affirm.com/

So Affirm has a rent-a-bank scheme with Iowa's Celtic Bank, and
eliminating Section 521 will let it make loans in Iowa so long as they
meet standards in California. That's a good deal if you want to
advertise "0% down, 0% APR, 0% hidden fees," and charge "0-30%."

Odinet points out that Affirm's 30% APR is pretty low by the usury
standards of fintech companies, but "it opens the door to much higher
cost lending by firms like Elevate Credit, Opportunity Financial, and
more--all of whom use the rent-a-bank model."

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

🎩 This day in history

#15yrsago DMCA revision proposal will jail Americans for “attempting”
infringment
https://web.archive.org/web/20060502093524/http://ipaction.org/blog/2006/04/bill-hollywood-cartels-dont-want-you_24.html

#15yrsago Proposal to let employees use personal laptops
https://web.archive.org/web/20060427234521/https://zgp.org/~dmarti/blosxom/business/byol.html

#10yrsago New Zealand’s rammed-through copyright law includes mass
warrantless surveillance and publication of accused’s browsing habits
http://www.stuff.co.nz/technology/digital-living/4922854/Copyright-change-about-more-than-idle-threats

#10yrsago Passover poem about robots: “When We Were Robots in Egypt”
https://www.tor.com/2011/04/24/when-we-were-robots-in-egypt/

#5yrsago Leading Republicans send letters in support of Dennis Hastert,
pedophile
https://web.archive.org/web/20160423124235/https://www.chicagotribune.com/news/local/breaking/ct-dennis-hastert-letters-met-20160422-story.html

#1yrago Facebook let advertisers target "pseudoscience" and "conspiracy"
https://pluralistic.net/2020/04/24/slicey-boi/#upton-sinclair-disease

#1yrago Amazon uses its sellers' data to figure out which products to
clone https://pluralistic.net/2020/04/24/slicey-boi/#moral-hazard

#1yrago Masks work https://pluralistic.net/2020/04/24/slicey-boi/#pewpew

#1yrago US healthcare fails insured people too
https://pluralistic.net/2020/04/24/slicey-boi/#m4a

#1yrago A labradoodle breeder is in charge of America's vaccines
https://pluralistic.net/2020/04/24/slicey-boi/#labradoodles

#1yrago Which guillotine is right for you
https://pluralistic.net/2020/04/24/slicey-boi/#slicey-boi

#1yrago Security expert conned out of $10,000
https://pluralistic.net/2020/04/24/slicey-boi/#overconfidence

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

🎩 Colophon

Today's top sources: Naked Capitalism (https://www.nakedcapitalism.com/).

Currently writing:

* A Little Brother short story about pipeline protests.  RESEARCH PHASE

* A short story about consumer data co-ops.  PLANNING

* A Little Brother short story about remote invigilation.  PLANNING

* A nonfiction book about excessive buyer-power in the arts, co-written
with Rebecca Giblin, "The Shakedown."  FINAL EDITS

* A post-GND utopian novel, "The Lost Cause."  FINISHED

* A cyberpunk noir thriller novel, "Red Team Blues."  FINISHED

Currently reading: Analogia by George Dyson.

Latest podcast: Past Performance is Not Indicative of Future Results
https://craphound.com/news/2021/03/28/past-performance-is-not-indicative-of-future-results/

Upcoming appearances:

* Book launch for Bruce Sterling's Robot Artists & Black Swans (Book
People), Apr 27,
https://www.bookpeople.com/event/virtual-event-bruce-sterling-robot-artists-black-swans

* Seize the Means of Computation, Ryerson Centre for Free Expression,
May 19,
https://cfe.ryerson.ca/events/how-destroy-surveillance-capitalism-seize-means-computation

Recent appearances:

* The Right to Repair Movement, Monopolies, and Solarpunk
https://www.youtube.com/watch?v=mmosdDCrL-4

* The surveillance state, digital monopolies, and why we should be
worried (Podsongs)
https://anchor.fm/podsongs/episodes/Cory-Doctorow-on-the-Surveillance-State--digital-monopolies--and-why-we-should-be-worried-eso43k

* Conspiracy Theories (Utopian Horizons):
https://soundcloud.com/utopianhorizons/conspiracy-theory-w-cory-doctorow

Latest book:

* "Attack Surface": The third Little Brother novel, a standalone
technothriller for adults. The *Washington Post* called it "a political
cyberthriller, vigorous, bold and savvy about the limits of revolution
and resistance." Order signed, personalized copies from Dark Delicacies
https://www.darkdel.com/store/p1840/Available_Now%3A_Attack_Surface.html

* "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet
analyzing the true harms of surveillance capitalism and proposing a
solution.
https://onezero.medium.com/how-to-destroy-surveillance-capitalism-8135e6744d59
(print edition:
https://bookshop.org/books/how-to-destroy-surveillance-capitalism/9781736205907)
(signed copies:
https://www.darkdel.com/store/p2024/Available_Now%3A__How_to_Destroy_Surveillance_Capitalism.html)

* "Little Brother/Homeland": A reissue omnibus edition with a new
introduction by Edward Snowden:
https://us.macmillan.com/books/9781250774583; personalized/signed copies
here:
https://www.darkdel.com/store/p1750/July%3A__Little_Brother_%26_Homeland.html

* "Poesy the Monster Slayer" a picture book about monsters, bedtime,
gender, and kicking ass. Order here:
https://us.macmillan.com/books/9781626723627. Get a personalized, signed
copy here:
https://www.darkdel.com/store/p1562/_Poesy_the_Monster_Slayer.html.

Upcoming books:

* The Shakedown, with Rebecca Giblin, nonfiction/business/politics,
Beacon Press 2022

This work licensed under a Creative Commons Attribution 4.0 license.
That means you can use it any way you like, including commercially,
provided that you attribute it to me, Cory Doctorow, and include a link
to pluralistic.net.

https://creativecommons.org/licenses/by/4.0/

Quotations and images are not included in this license; they are
included either under a limitation or exception to copyright, or on the
basis of a separate license. Please exercise caution.

_,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,__,.-'~'-.,_

🎩 How to get Pluralistic:

Blog (no ads, tracking, or data-collection):

Pluralistic.net

Newsletter (no ads, tracking, or data-collection):

https://pluralistic.net/plura-list

Mastodon (no ads, tracking, or data-collection):

https://mamot.fr/web/accounts/303320

Twitter (mass-scale, unrestricted, third-party surveillance and
advertising):

https://twitter.com/doctorow

Tumblr (mass-scale, unrestricted, third-party surveillance and advertising):

https://mostlysignssomeportents.tumblr.com/tagged/pluralistic

"*When life gives you SARS, you make sarsaparilla*" -Joey "Accordion
Guy" DeVilla

-------------- next part --------------
A non-text attachment was scrubbed...
Name: signature.asc
Type: application/pgp-signature
Size: 195 bytes
Desc: OpenPGP digital signature
URL: <http://mail.flarn.com/pipermail/plura-list/attachments/20210424/4b8cb1c2/attachment.sig>