Senator Jay Rockefeller
November 12, 2013
On Veterans Day, we pay particularly close attention to the men and women who make extraordinary sacrifices to defend our nation. We honor their service to our country and remember those no longer with us. But on every other day of the year, service members face the same financial decisions that other consumers face. They purchase homes, finance cars, and take out lines of credit to buy computers and other things for their families.
Unlike the rest of us, though, our service members face these decisions under entirely different conditions that we can barely imagine. They move frequently, sometimes with very little notice, and perform their jobs in dangerous war zones for months at a time. These conditions pose significant challenges, but imagine adding to this stress a dispute with a credit card company, or receiving harassing letters from a debt collector while living in a war zone.
One of the basic promises we make to our soldiers is that when you make these extraordinary sacrifices, we will protect you on the home front. To that end, federal law provides consumer protections for the military and their families – it bans certain kinds of predatory loans, places caps on the interest rate that can be charged on credit cards. We’ve given active service members the ability to cancel apartment and car leases, and made it more difficult for banks and other lenders to foreclose on their homes.
Despite these legal protections, members of the military are still ripe targets for abusive financial practices. Many soldiers are young and inexperienced with their finances, and living on a military base in foreign country makes it difficult to shop for the insurance rates. Plus, the steady government paychecks of soldiers, as well as the pension income of retired veterans, are opportunities for aggressive lenders looking to make a quick buck.
Since I have been chairman of the Senate Commerce Committee, my priority has been to protect consumers. I’ve kept a close eye on unscrupulous businesses and con artists trying to deprive Americans of their hard-earned money. One case that we uncovered in 2011, exposed major lenders that sent active duty soldiers illegal foreclosure notices and overcharges on their mortgages. Military service members have had their credit cards improperly cancelled and, while abroad serving our country, some families have received harassing phone calls from debt collectors.
Last year, Rep. Elijah Cummings and I convened a forum to get to the bottom of these unlawful schemes. We heard stories about enlisted officers in Iraq, performing some of the toughest jobs in a war zone, who had to stop their mission to take care of their family back home. Putting a full twelve hours in as a soldier, and then spending every spare moment on hold with a bank, is incredibly taxing both physically and mentally. It’s unfair and wrong to put our soldiers in this position. And, it’s why Rep. Cummings and I introduced legislation to give soldiers a reprieve from foreclosure while deployed, with increased penalties for mortgage lenders if they violated the law.
Sadly, since our forum last year, service members have continued to be bombarded with these schemes. Websites catering to the military advertise loans that can be made online. But some of these loans have triple-digit interest rates and high fees that make it virtually impossible for soldiers to pay them back on time.
I’ve also heard troubling stories about debt collectors that call threatening to go to the soldier’s supervisor unless the debt is paid. They raise the specter of damaging the soldier’s financial record he needs to meet security clearance requirements and keep his job. Granted, sometimes these debts are legitimate, but other times the bill collector doesn’t provide any information about the source of the debt, how old it is or even whether it was already paid.
Soldiers should be able to focus entirely on the mission they were sent to accomplish. They shouldn’t have to deal with abusive behavior from aggressive bill collectors, eviction from an apartment while abroad, or the emotional and time consuming toll of having a family deal with home foreclosure. This is why I continue to work hard to protect our men and women in uniform. They’re consumers just like the rest of us, and the law gives them protections. So in the coming weeks, I plan to take a closer look at abusive financial practices affecting our service members.
Our active duty and retired service members deserve our nation’s respect. For those who aren’t being treated with the dignity that they so rightfully earned, rest assured that I will never back down from the fight to uphold the promise to protect all of our soldiers and veterans at home.