Henry hired Palermo Galindo as Fort Wayne’s Hispanic-immigrant liaison back in June. Palermo Galindo operates Centro De Dinero, one of those high-priced check cashing services whose target audience is the Hispanic market, and undoubtedly Fort Wayne’s illegal alien population.

Yesterday at the state of the city address Henry announced a new and exciting program to help people stay away from the leeches that operate payday loan sites.

Tonight I am also excited to announce my intent to create the “Bank on Fort Wayne” program. This new initiative will generate opportunities for any Fort Wayne residents who have relied on expensive check-cashing services and payday loan operations. This initiative will allow them to open bank accounts at local financial institutions while also receiving financial tools. Founded on the success of similar programs in Evansville and other cities, I see Bank on Fort Wayne as a win-win. It will allow some of Fort Wayne’s hardest working residents to keep more of the money they earn, save for the future, and establish relationships with local banks. I look forward to working with Councilman Hines with his banking experience, as well as the financial institutions here in Fort Wayne on this important project.

Henry’s not addressing the real problem here.

Galindo and his company, Centro De Dinero, are raking in annual percentage rates that the mafia would admire. While we could not get anyone on the phone at Centro, we did check online and it appears most all of the payday loan operators charge the same fees, the maximum allowed by the state.

Using a $500 loan amount, we used their online calculators and found the rates identical.

You Borrow: $500.00
You Payback: $567.00
Finance Charge: $67.00
APR: 349.36%

That’s for a two week loan.

By our count there are at least 27 payday loan locations in the city of Fort Wayne, with 8 concentrated on South Lafayette, South Calhoun and Broadway.

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Payday loans strap borrowers with triple digit interest rates, and it’s almost always families that are living on the financial edge. They generally locate in black and poor neighborhoods, preying on those that are financially weak.

Cities are now passing ordinances that restrict both the density of payday loan operations and the distance between them. A good start would be a a temporary moratorium on any new payday loan operations, with an eventual restriction on the number of operators. Many cities also require a special use permit. In DeSoto, KS they don’t allow payday loan operations at all.

Fort Wayne has an extensive ordinancelink governing the operation of pawn shops and those that deal in precious metals and stones. Just last week I received an email from someone that had been contacted by the Fort Wayne Police Department for offering to buy gold on Craig’s List. He was told it was illegal. I checked and indeed, without a license it is.

In Indiana Payday loan operators are regulated by the Indiana Department of Financial Institutions. I’m not certain if the city of Fort Wayne can regulate the rates. Mitch?

Many cities have enacted ordinances that do, where allowed by state law. In 2007, several cities in Virginia passed resolutions asking their state General Assembly to cap payday interest rates at 36%. In 2008, it became state law.

Henry never explained any details about the “Bank on Fort Wayne” program. I suspect it’s just another feel-good gesture to give folks a warm fuzzy feeling.

Payday loan operators are supposed to be licensed . We did check the licensing databaselink for Centro De Dinero. We could not find them.

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