Payday lending involves short-term loans that are usually repaid within one or two weeks, often with a post-dated check that is deposited after the borrower receives his or her paycheck

A number of national banks essentially rented out their charters to third party payday lenders

• The OCC found that a number of banks were unable to properly oversee the third party lenders who were making loans in their names, particularly smaller banks

Among the practices found by the OCC were

• Deceptive marketing practices
• Failure to properly secure confidential customer files
• Unsafe and unsound lending

Interagency statement urging banks and thrifts to evaluate the risks with vendors engaged in practices viewed as abusive to consumers

• Statement
• Advisory letter on payday lending
• Advisory letter on title loans

FDIC guidance for bank examiners on Payday Lending

Legislation recently introduced in the House of Representatives (H.R. 2871) which amends the Truth in Lending Act to prohibit payday lending by insured depository institutions and to prohibit it entirely if based upon a check drawn upon a depository institution 6.26.07

Peoples National Bank

First National Bank in Brookings

SEC_CODE_REF_0090001192884

Goleta National Bank & ACE Cash Express

People's National Bank of Paris, TX

Eagle National Bank of Upper Darby, PA

FDIC guidance

Analysis of FDIC Guidance

• Center for Responsible Lending

NCUA Guidance