A military lender based near New York City has agreed to stop charging Fort Drum soldiers excessive interest on emergency loans.
Matthew Anderson, with the New York State Department of Financial Services, says for over a decade, military lending companies have been charging service members more than double the state's interest rate caps.
“If you were not a permanent New York resident but were simply stationed here, the lenders took it to mean they didn’t have to comply with New York laws. They could charge higher interest rates,” Anderson said.
Omni Military Lending, which operates a storefront near Fort Drum, has agreed to comply with state law. According to the governor's office, the company charged out-of-state military up to 36 percent interest on loans.
“What we’ve done is close this loophole. Omni has already agreed to abide by it but we’ll also continue to crack down on other companies that try to exploit this to jack up interest rates for our military service members,” Anderson said.
The Department of Financial Services plans to focus next on stopping online predatory lenders who target military service members in New York.