Release: New Consumer and Employee Financial Protections for Chicago Residents
January 22, 2013
Last Thursday City Council enacted three new laws that will further protect Chicago residents from fraudulent debt collection services, employers that engage in wage-theft, and the proliferation of Payday Lenders, Auto Title Lenders, and Pawn Shops in our neighborhoods.
“Working families are among the most vulnerable to harassing debt collectors, unscrupulous employers and exorbitant finance charges,” said City Treasurer Stephanie Neely. “These new ordinances help all residents get a fair shake.”
- Debt collectors will now have to be licensed to operate in Chicago and must follow basic standards of practice including ensuring that debtors know who is owed, how much they owe, and have an opportunity to contest the debt.
- The City now has the power to revoke the operating license of businesses that repeatedly engage in the theft of wages that have been rightfully earned by their employees. This also helps level the playing field for businesses that play by the rules.
- Finally, no new payday lenders, auto title lenders, and pawn shops will be able to operate within 1000 feet of an existing business. The goal of this ordinance is to eliminate the over-concentration of these types of alternative financial institutions which have been shown to have negative effects on the neighborhoods.
The Treasurer’s Office’s mission is to increase the financial stability of Chicago’s residents through financial literacy, ensuring access to safe financial products, and creating incentives to build financial assets. These new consumer protections are an important addition to our efforts and I applaud the Mayor, Business Affairs, and City Council for working to enact these new rules.
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