June 6, 2008

Devils Lake Man Testifies at Senate Committee Hearing on Predatory Lending in Indian Country

The President of the Citizen Community Credit Union in Devils Lake testified Thursday at an official Capitol Hill hearing of U.S. Senator Byron Dorgan’s Indian Affairs Committee. Darwin Brokke told committee members about two programs he started at his credit union to offset the effects of predatory lending practices in tribal communities.
Dorgan called the hearing to examine the issue of predatory lending, which has a particularly large effect on American Indian communities. In a recent survey, 73 percent of tribal representatives reported that predatory lending is a problem in their communities. Between 2002 and 2005, Native Americans in North Dakota were engaged with the high-cost market more than five times as often as non-Natives.
Brokke briefed Dorgan’s committee on programs he started at Citizen Community Credit Union to give area residents safer alternatives to payday loans and other quick-money deals that often lead borrowers into a cycle of debt.
“Lack of access to financial institutions plays a key role in poverty in any community,” Brokke said in his testimony. “The additional challenges associated with serving Native American communities make it even more the case in these areas. Those without access to financial institutions do not have the opportunity to build assets and accumulate wealth. And, in many cases, they are forced to use informal lending structures, including borrowing from family or friends, or turning to payday lenders.”
“Predatory lending is a serious issue that has affected far too many in our American Indian communities,” Dorgan said. “Our committee appreciated the ideas advanced by Mr. Brokke as we search for ways to put a stop to predatory lending practices.”