The past week's Stevie Wonder Award, presented to the financial institution or affiliated party that was so blind it could not see that it was stepping in a public relations cowpie of epic breadth and depth, goes to...[drum roll]...:
It's A Tie!
Ladies and germs, we have a dead heat this week between payday lender Rent-A-Center ("perennially persecuting the penniless from its world headquarters in scenic Plano, Texas") and bank director William Farr of Denver-based Centennial Bank Holdings Inc. ("in racial sensitivity training classes since 1992").
First, Rent-A-Center.
According to last Friday's The Wall Street Journal, Rent-A-Center executives repeatedly called an Ohio food-bank association and demanded that they withdraw from a coalition that supports legislation that would make it tougher for payday lenders to do business in Ohio.
In a series of telephone calls in recent weeks, Rent-A-Center executives warned America's Second Harvest and its Ohio affiliates that Rent-A-Center would yank charitable contributions from hunger programs in the state unless the local food banks withdrew from the Ohio Coalition for Responsible Lending. The coalition has been pressing the state legislature to cap high interest rates charged on payday loans.
Wednesday, the Ohio House passed a bill that would cap the annualized interest rate on payday loans at 28% and limit borrowers to four loans of $500 each a year. Ohio's governor said last week that he supports a cap.
Rent-A-Center currently charges interest rates on one-week payday loans that are equivalent to an annual rate of as much as 782%, according to a company Web site. In Ohio, the average borrower pays $15 for each $100 borrowed, and the typical loan is repaid in 19 days, a 288.16% annual rate, the company says.
Well, if the legislation will effectively put Rent-A-Center out of the payday lending business in Ohio, you can understand why it would be irked that a non-profit association it funds might be supporting such legislation. Nevertheless, you have to weigh the disproportionately negative effect that appearing to strong-arm a food bank that feeds the poor will have on your fight against that legislation against the benefit gained from "repeatedly" calling officials of the food bank to express your displeasure. As it turned out, the incident was featured prominently in a major pro-business newspaper in a way that didn't help Rent-A-Center's cause. It gave proponents of the legislation a chance to paint the payday lender as a brow-beater.
As for Mr. Farr (no relation to actor Jamie Farr, I hope), his sense of humor is a bit "unrefined."
William Farr, up for re-election to Centennial's board of directors, is likely to come under fire for a poorly received joke he made about U.S. presidential candidate Barack Obama at a National Western Stock Show banquet in January, [activist shareholder Gerald] Armstrong said.
According to news reports, Farr pretended to read a telegram from the White House, then quipped "they're going to have to change the name of that building if Obama's elected."
Yeah, it took me a minute to parse that out, too. My conscious mind refused to accept what my subconscious mind immediately grasped. I mean, I realize that we're talking about a stock show, but that doesn't mean that reporters wouldn't be in attendance, even if Mr. Farr assumed that every attendee was a bigot.
"People in Northern Colorado are concerned about it," Armstrong said. "They don't think he should be on any board, anywhere."
Well, there might be some payday lenders who could use such a sensitive soul on their boards.
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