Oklahoma House of Representatives
Media Division
July 2, 2003

OKLAHOMA CITY - A legislative study requested by a southwest
Oklahoma lawmaker will focus on predatory lending and easy access to
credit cards, especially by college students.
Rep. Joe Dorman has requested an interim study relating to
predatory lending and the ease in which college students are able to
acquire credit cards in this state.
Emphasis of the study is to look at recommendations on how to use
credit responsibly and to educate those Oklahomans who are new to credit
opportunities, Dorman said. The legislative study also will analyze
interest rates on a variety of loans available to consumers and
determine if any fall under the predatory lending status.
"In this age of materialism how much a person is worth judging by
his or her belongings is a perfect time to introduce unsuspecting
young adults to the world of 'plastic money'," Dorman said. "Young
adults with no credit history appear to be the targets for charge card
salesmen."
If abused, those cards are like sharp barbs that dig deeper and
deeper while trying to pay off a balance filled with additional late
fees, skipped monthly payment charges and astronomically high interest
rates.
"Too many Oklahomans find themselves so deep in debt they have no
way of climbing out, and it could stem from a lack of understanding how
credit works," the Rush Springs Democrat said. "We want to ensure that
opportunities will be available out there to teach credit
responsibility, because people should realize that debt at a high
interest rate is not the easy way out of a debt situation."
A Comanche County constituent is a living example of how credit
card spending could get out of hand by college students who were duped
into signing a charge card application by fast-talking company
employees.
Ray Dietrich was an OSU sophomore in 1987. He was cruising through
the Student Union when a man literally grabbed him by his backpack and
started the "hard-sell" by asking Dietrich if he had established a
credit history. Dietrich was hooked by the salesman.
Three weeks after signing the application, Dietrich received his
first charge card in the mail, along with a variety of advertisements to
buy an assortment of merchandise, which included everything from luggage
to expensive stereo equipment.
"I had the same stereo since I was 12 years old," Dietrich said.
"It was time for a brand new sound system." But the stereo had a $1,500
price tag, and Dietrich was armed with a charge card that had a mere
$200 limit.
"I showed the store clerk a catalog photograph of the expensive
stereo and told her about my card's limit. I asked her if there was any
way I could buy the stereo?" he said. "The clerk told me that my new
stereo would arrive in four days."
Dietrich was able to pay off the stereo within 30 days using
student loans, which triggered a barrage of credit card advertisements
in the mail. "Within 90 days, I had 20 credit cards with a combined
limit of $135,000!" he proclaimed.
Dietrich is no stranger to the world of money. He is in the finance
business and operates a mortgage company in Elgin. He is a former board
director for a worldwide asset non-profit management association and
spent time in Atlanta Ga in 1998-99 as a business finance consultant.
While working in that southern state, Deitrich recalled two women
who had taken their own lives at a college campus due to excessive
charge card debt. The girls' fathers had been laid off work at a popular
soft drink manufacturer and the students had run up thousands of dollars
on the charge cards and couldn't afford to pay them off.
"Because of those credit cards, two families no longer have
daughters," said Dietrich, who is the father of an eight-year-old son.
"I deal with the effects of financial debt often in my line of
work. Statistics indicate that 76 percent of divorce, 68 percent of
child abuse and 25 percent of suicide are directly related to
indebtedness or finance issues in the American family."
Dorman and Dietrich agree that if parents don't advise their
children about the woes of charge card spending, there are few others
who would be willing to help a troubled young adult with financial
advise.
Dietrich said he has been working on an idea for a children's
coloring book series and a single-edition comic book for teenagers that
would help explain the general issues of charge card and money spending.
"It's unwise for parents to allow their children to apply for
charge cards, especially if the kids don't have a full time job and
haven't been taught that frivolous spending habits can get them into
real financial trouble," Dietrich said. "Using credit cards should not
be taken lightly."
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Scott Hancock
Media Specialist
Oklahoma House of Representatives
1-800-522-8502 ext 422


What Oklahoma really needs is strict regulation of collection agencies and creditors modeled on the California consumer protection laws.
  ¶ 12:19 PM