A Fighting Chance

In short, staccato sentences, Holly told me about her work at the Better Business Bureau running a national program designed to address the financial problems of military families. The stories she recounted were heartbreaking.

She described the vulnerability of the youngest in service, kids fresh out of high school who were picking up the first regular paychecks in their lives. They were about to be sent off to fight in Iraq or Afghanistan or deployed to another military base somewhere around the world. From the moment they enlisted, Holly explained, these young soldiers became targets for a number of aggressive scams. As soon as they showed up for basic training, they would be pursued relentlessly by lenders who would sign them up for loans that took a huge chunk of their paychecks. Once the young soldiers arrived on base, they ran a gauntlet of businesses set up near the gates and at nearby malls, including stores that hired pretty young women to flirt with the young male soldiers and sell them overpriced electronic equipment on installment loans that charged 100 percent interest or more. Just sign here, sweetie.

Holly talked about how a bad debt could ruin not just a service member’s credit score, but also the person’s career. Not paying a debt is deemed “dishonorable conduct,” a black mark that can cause soldiers to lose out on security clearances they need for promotions and special assignments.

She also talked about how frequent moves and unexpected deployments made young families especially vulnerable. To cover a security deposit on a new lease or to pay for Grandma to fly in to help with the kids, they often faced a sudden need for cash. And lenders lined up to offer that cash at ultrahigh interest rates, springing a trap that would leave some service members repaying for years and years.

Holly spoke with particular urgency as she described the hardship caused by double deployments, which happened when both spouses were military. Very quickly, many of these families got tangled up with homes they couldn’t live in and mortgages they couldn’t pay. Rules had been written that were supposed to help them, but in Holly’s experience lenders often skirted those rules and tossed military families out of their homes.

Holly’s list of concerns was long. She was clearly angry, and I thought she was right to be angry.

I already knew that these weren’t isolated incidents. In 2006, the Department of Defense studied predatory lending that targeted service members and concluded that such lending “undermines military readiness, harms the morale of troops and their families, and adds to the cost of fielding an all-volunteer fighting force.” The study was loaded with specific examples, including one about a woman in the air force who had originally borrowed $400 and over the years paid the lender $3,000 in interest and principal. Even then, she still couldn’t escape her monthly payments and finally had to declare bankruptcy.

Sure, military families were protected by a number of laws, but not enough of the laws had real muscle behind them. For example, Congress had passed a specific prohibition on charging excessive interest rates on payday loans to service members. But Holly pointed out that anyone who Googled “military payday loans” would find dozens of links that would take them to companies that were ready to lend at truly shocking interest rates. And just to rub a little salt in the wound, many of those sites had official-sounding names that included words like “Armed Forces” or “Military Loans,” suggesting that the money was coming from someone official who would do right by the service member.

As we ended that first meeting, Holly swung into her pitch. “You can do something about this.” She sounded like a recruiting poster come to life. I leaned back a little, but she didn’t slow down. She pointed out that the new agency had “real potential” and that if we made protecting members of the military a priority, we could stop these terrible practices.

I knew Holly was right, and every time I thought about her visit, I got angry all over again. The service members Holly described were people who had dedicated themselves to keeping us safe. Couldn’t we find a way to make sure they didn’t get cheated when they took out a loan? The scam artists and predatory lenders who targeted our men and women in uniform were a national disgrace, and I sincerely hoped there was a special circle of hell just for them. The consumer agency needed to make fixing this problem a priority, but to do that, we would need a leader with passion and commitment.

So shortly after our first meeting, I asked Holly to be that leader. She was surprised, but she quickly said yes.

And now here we were at Joint Base San Antonio for Holly’s public kickoff.