Kyrsten Sinema founded Payday Loan Booster Consulting

Sen. Carsten Cinema Poor, so poor that, according to him, at least at one point his family lived in an abandoned gas station with no utilities or running water. On the campaign trail, Arizona Independent is quick to describe childhood struggles with poverty and homelessness, often recounting how she relied on government-subsidized free school meals to survive.

Since his own poor upbringing, Cinema has championed the same businesses exploiting Americans in poverty, chief among them the payday loan industry. Such lenders have donated more cash to cinema than any other senator.

Before taking thousands of dollars in campaign cash from payday lenders for his congressional race, Cinema teamed up with a one-time industry ally to form their own company.

In 2007, Sinema started a consulting firm with his friend and former Democratic state Rep. Chad Campbell, a key supporter of industry-backed bills in the Legislature who would become a lobbyist for the payday loan industry in Arizona, according to Arizona LLC filings. .

Cinema’s alliance with Campbell foreshadowed his political transformation, an evolution that, as his power in national politics grew, saw the one-time progressive move away from his roots as a Green Party member and anti-war activist to embrace the very industries he once railed against.

The firm, Forza Consulting LLC, remains active, according to the filing, although there is no public indication of corporate activity. Campbell and the movie company principal, listed as the movie manager, is former Democratic state Rep. David Lujan.

“It was just a consulting firm that we thought about creating,” Campbell, who served in the Arizona State Legislature from 2007 to 2015, told The Intercept. “And we never had a single thing with it. In essence, never existed.” (Cinema did not respond to a request for comment.)

In Congress, Cinema has consistently sided with payday lenders.

Payday lenders charge extra fees for short-term loans with interest rates of up to 400 percent, because borrowers are expected to repay the loan with their next paycheck. However, the loans are considered predatory and are banned or restricted in 18 states because they can create a chain of further debt that puts borrowers into debt.

“Most payday and title loans result in other loans,” noted a 2016 report by the Center for American Progress. “Eighty percent of payday and auto title loans are rolled over or refinanced within just two weeks of the initial loan, because borrowers are unable to afford other necessary expenses. The average payday loan borrower has been in debt for more than six months, and 15 percent of the new loan will be followed by a series of at least 10 additional loans.”

Enter Arizona A decade and a half battle with payday loans. Lending companies, often storefront operations, operate in the state because of longstanding interest rate exemptions. As the exemption’s expiration date approaches, both industry advocates and opponents have ramped up their work on the issue.

Among the earlier salvos was a 2007 legislative bill that would have allowed payday lenders to continue operating in the state with lower interest rates and required additional screening measures. Opponents of the bill say it doesn’t go far enough and leaves too much discretion in the hands of lenders. Its proponents call the bill a thorough reform effort that provides a much-needed credit alternative to those facing difficult circumstances.

“To say people who are in financial trouble need access to this kind of credit is like giving rotten food to a starving person,” Whitney Barclay-Denny, senior policy counsel at the Center for Responsible Lending, told the Intercept. “It makes them sicker than they were in the first place. People who borrow with payday loans find themselves facing bankruptcy, foreclosure, and worse. So the solution to the problems many people are facing is higher wages and better jobs, rather than debt. Which plunges them further and further into financial insecurity.”

Among the supporters of the 2007 bill were a lobbyist who represents payday lending interests, as well as Chad Campbell, then a state representative from Phoenix. The bill ultimately failed in the legislature.

In 2008, another attempt by the lending industry to gain a foothold in the state died at the hands of Arizona voters. Industry groups have spent millions promoting Proposition 200, a ballot measure that would roll back interest rate caps to take effect in 2010. Arizona voters defeated the measure by a 3-to-2 margin

“Saying that people who are in financial trouble need access to this kind of credit is like giving rotten food to a starving person.”

After 2010, the payday lending industry was forced to comply with newly lowered rates, but that didn’t stop lenders from launching a new effort to win back business.

In 2017, two years after Campbell left the Arizona Legislature, industry-backed workaround bills were advanced to create new loan options similar to payday loans but with names like “flex loans” and “customer lines of credit.” A bill that would have allowed loans with interest rates higher than 100 percent was on a fast track to passage in 2017 but was ultimately kept at bay.

At that time, Campbell began lobbying for payday loan interest. He was a registered lobbyist between 2017 and 2020 for the Arizona Financial Choice Association, an industry trade group that advocates for lenders and a key supporter of a failed 2008 ballot measure to allow payday lenders to continue operating. Campbell emphasized that the group does not represent payday lenders.

“There are no payday loans. It is not a payday loan,” he said. “I actually helped kill payday lending in Arizona when I was in the legislature, so I’m not going to work for payday lending.”

The Arizona Financial Choice Association came under fire in 2016, when Democratic state Rep. Debbie McCune Davis called for an investigation into her letter drive to support legislation to create “flex loans.” McCune Davis said many of the signatories to the letter sent to state politicians did not understand the content of the bill and, in some cases, did not even understand what the letter was for.

“I was working on a compromise piece of legislation at the state level with the industry at the time,” Campbell said, discussing the period when he was registered in the lobby.

“By law, I was registered as a lobbyist because that’s how it works here,” Campbell said. “I just had to do it as a formality. But I have never worked with them in any capacity at the federal level.”

“So, like I said, it has nothing to do with the Karsten movie in any way shape or form.” Campbell said.

Community Choice Financial, one of the payday lenders represented by the Arizona Financial Choice Association, has donated $21,000 to the movie since 2016.

These donations were part of the cinema’s collection from payday lenders. He received the most money of any active senator from industry, $168,000, and Sens. Richard Shelby, R-Ala. and ranks third among lifetime arts recipients behind Harry Reid, D-Nev.

Forza Consulting LLC, the firm that Cinema started with Campbell, has not appeared on any of Cinema’s US House or Senate disclosure forms, despite the company’s active status. Another consultancy he has incorporated, Cinema Consulting LLC, appears in the publication.

Cinema and Campbell Served together in the Arizona House of Representatives until 2010, a period that spanned the first three years after founding Forza Consulting LLC in 2007. Cinema went to the State Senate, then the US Congress, Campbell remained in the State House for five more years. year

The pair have been friendly since their time in state politics. Campbell, for his part, has consistently defended the movie’s right-wing turn. “He believes in rules and he believes in processes, and he will figure out how to use those rules and processes to his advantage and bring people into alignment with his goals,” he told Mother Jones in 2021. Campbell also praised the movie to the Associated Press and the New York Times.

The two also have a recent financial relationship. In 2014, Campbell was listed as a board member of Arizona-based political mobilization organization Leading for Change. That same year, the movie earned more than $3,000 from the agency — a fee for leading a training session. (Campbell said he didn’t take the job easy and was involved with the company long before he joined the cinema board.)

Since ascending to the U.S. Senate, Cinema has used his increasingly powerful vote to advocate for concessions to the private equity industry, block filibuster reform, and doom progressives’ top priorities.

Last month, he split with the Democratic Party to become an independent again — signaling that, in the new Congress, his political alignment may shift further away from the Democratic Party’s liberals.

Long before his departure from the party, Sinema consistently rebuffed consumer protection advocates’ efforts to regulate the payday loan industry and repeatedly championed lending groups. He tried to block reform efforts and sponsored legislation to protect loan companies from federal oversight.

Cinema has used his increasingly powerful vote to advocate for concessions to the private equity industry, block filibuster reform and doom progressives’ top priorities.

In 2016, he joined Republicans in signing a letter to the Consumer Financial Protection Bureau, or CFPB, condemning the agency’s regulatory work on payday lenders. In just two days – the day before the letter was sent and the day it went out – she received over ten thousand dollars in donations from the payday loan industry.

In July of the same year, he voted against an amendment that stripped language from a House appropriations bill that sought to defund the CFPB’s efforts to target predatory lenders. He also co-sponsored the Consumer Protection and Choice Act, which sought to protect payday lenders from the CFPB by replacing federal regulatory authority with legislation that supports lenders.

His repeated attempts to chip away at the CFPB’s enforcement powers — and the way he ran his campaign — have strained Sinema’s relationship with Washington progressives, including Ornery Republican Bernie Frank, D-Mass. Cinema claimed the former representative supported his efforts to replace the CFPB with a bipartisan commission — a claim Frank said was false and received a fiery letter from him in 2015.

“I am writing this only because you have misrepresented my position, falsely trying to portray me as changing the subject,” Frank wrote. “I’m not surprised when right-wing Republicans do this but disappointed that you’ve joined them in this tactic.”