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SCOTUS Case Links Rightwing Activist to ‘Predatory Payday Lenders’

U.S. Dollars. Image: Creative Commons.
Image: Creative Commons.

As the US Supreme Court gears up for its new term, rightwing activist Leonard Leo’s funding of special interest groups involved in a pivotal Supreme Court case is under scrutiny. The case, Consumer Financial Protection Bureau v Community Financial Services Association of America (CFPB v CFSAA), has the potential to significantly weaken the federal government’s capacity to regulate corporations.

Leo’s Influence on the Supreme Court

Leonard Leo, a prominent conservative activist and a driving force behind campaigns to appoint three conservative Supreme Court justices during the Trump administration, has been linked to a network of groups funding amicus briefs in support of payday lenders within the CFPB v CFSAA case. This case, scheduled for the upcoming term, is critical and could challenge regulations aimed at protecting consumers.

The Case in Question

The CFPB, established under the Obama administration after the 2008-2009 global recession, was designed to safeguard ordinary Americans from exploitative business practices. On the other side, the CFSAA represents a group of payday lenders. The outcome of this case could not only impact the payday-lending rule in question but also a range of other consumer protection regulations.

Leo’s Funding and Influence

Entities supported by Leonard Leo have invested over $9 million in various groups that have filed amicus briefs supporting payday lenders in CFPB v CFSAA. Some notable beneficiaries of Leo’s network include the Foundation for Government Accountability, the New Civil Liberties Alliance, America’s Future, and the Americans for Prosperity Foundation.

Leo, who The Guardian newspaper claims has not responded to their requests for comment, has a significant role in shaping the Supreme Court’s conservative makeup and his involvement in cases with far-reaching consequences has brought increased scrutiny from watchdog groups.

‘Free To Campaign’

Michael Sean Winters a writer for the left-leaning National Catholic Register magazine, said in light of the probe into Leo: “Leo is a private citizen and is free to campaign for candidates who will appoint more conservative jurists, to groom young, talented conservative lawyers and help further their careers, and to offer former President Donald Trump a list of prospective Supreme Court Justices to appoint. In this great, free country of ours, no one has a right to complain about Leo’s political advocacy just because he was successful in producing results we do not like.

“I have never felt there was anything sinister per se about groups like the Federalist Society, or its liberal counterpart the American Constitution Society, providing networks, mentoring and advocacy.

However he added that , “The effect.. has been to politicize the courts, in reality and in perception, and that is not a good thing.”

Are Payday Lenders Illegal?

Payday lenders are legal in the United States, although their operations and regulations vary by state. Payday lending is a short-term, small-dollar loan typically due on the borrower’s next payday. These loans often come with high interest rates and fees, making them a controversial form of lending.

Federal law does not specifically regulate payday lending, but individual states have their own laws and regulations regarding the industry. Some states have imposed restrictions or caps on interest rates and fees to protect consumers from excessive borrowing costs. Others have completely banned or severely restricted payday lending.

The upcoming term of the Supreme Court will undoubtedly see a reinvigorated focus on Leo’s involvement and the potential influence of conservative activists on key decisions. The impact of such influence on consumer rights and regulatory frameworks remains a subject of intense debate.

Georgia Gilholy is a journalist based in the United Kingdom who has been published in Newsweek, The Times of Israel, and the Spectator. Gilholy writes about international politics, culture, and education. 

Written By

Georgia Gilholy is a journalist based in the United Kingdom who has been published in Newsweek, The Times of Israel, and the Spectator. Gilholy writes about international politics, culture, and education.