OGDEN — As part of its campaign against the payday loan industry, an Ogden businessman was named “Predator of the Week” by Americans for Payday Lending Reform, a project put forward by the grassroots National People’s Action network.

Kip Cashmore, 53, owns about three dozen USA Cash Services stores in the western United States, with advertised “convenient locations” in Clearfield, Layton, Ogden, North Ogden, Riverdale, Roy, Logan, Taylorsville, Sandy and Orem.

“Cashmore’s claim to fame is having been identified in an investigation of Utah Attorney General John Swallow for donating tens-of-thousands of dollars through a web of non-profits to conceal his identity. The contributions were made after Swallow told Cashmore that he would be an ally against regulating the payday lending industry,” the anti-payday-lending campaign website called preydaylenders.org says, adding that Swallow thanked Cashmore for his help on Election Day via text message. Those details were brought to light by a special Utah House probe in 2013 that ultimately led to Swallow’s resignation last December.

Cashmore, responding by email, said he was deeply disappointed by NPA’s personal attack.

“I will be considering pursuing legal action for gross and manipulative misrepresentation of the facts,” Cashmore said. “As a reminder, donations to PACs and other organizations supporting a political candidate are a legal, common and acceptable practice.”

Cashmore also went to bat for the industry he represents: “Payday loans are an important choice for millions of consumers, and I am proud to provide this valuable access to short-term credit for individuals and families.”

However, National People’s Action — the driving force behind preydaylenders.org — hopes to rein in the industry that Cashmore represents, rather than Cashmore himself.

“Our target is not Kip, it is the payday lending industry. And he is not unique in any way. This is an industry that depends on people getting trapped in very-high interest debt,” said NPA Policy Director Liz Murray.

Murray said that the timing of their campaign coincides with the federal Consumer Financial Protection Bureau’s pending rulemaking on the payday loan industry. While the CFPB leaves interest-capping to the states themselves, the federal agency can limit the number of loans an individual taps in a year’s time and can also cap the number of days of indebtedness. It can also require that the granting of loans be based on ability to repay.

“The industry has depended on this rollover pattern and just bled people time after time,” Murray said. “We need an expense-and-income ability to repay.”

And finally, Murray said she hopes that the CFPB cracks down on automatic withdrawals, where as a condition of the loan, the industry can electronically withdraw payment directly from the recipient’s account.

The Chicago-based NPA got its start 41 years ago, Murray said, with an initial focus on access-to-credit issues and the redlining of communities by banks and mortgage lenders. That work led to Congress passing the Home Mortgage Disclosure Act in 1975. 

“We understand that good credit can be the lifeblood of a community and bad credit is a poison,” Murray said. NPA is a network of community and state-based organizations in 17 states, Utah not among them.

The majority of Utah lawmakers have balked at attempts to impose interest caps on payday loans, which can climb as high as 500 percent annually. But Utah now limits payday loan terms to 10 weeks, according to the non-profit Consumer Federation of America. So far, 18 states and the District of Columbia have barred payday loans either through direct prohibitions or lower rate caps. But Utah is among 32 states that allow annual interest rates to reach triple digits.

On preydaylending.org, NPA refers to Cashmore as a “bad boy,” and paints him as a businessman who made significant financial gain off his USA Cash Services stores, pointing to his $1 million 6,700-square-foot Ogden home and 40-acre Eden Lake Meadows subdivision as proof of his wealth.

The larger scandal may actually be Cashmore’s steadfast opposition to payday lending reforms that protect hardworking families from crippling debt, the website said, citing Cashmore’s comments to state lawmakers that restrictions weren’t needed because consumers were happy.

The nonprofit NPA also took Cashmore to task for funneling over $40,000 in contributions to candidates and political action committees between 2008 and 2013 as documented by OpenSecrets.org.

According to the Utah Department of Financial Institutions 2013 annual report, the average annual percentage rate charged on deferred deposit loans last year was 473.52 percent. Of 22 complaints DFI received about payday loans in 2013, 13 had to do with lenders not registered with the state. All 22 were considered to be resolved, the report said.

According to the CFPB, only 3 percent of complaints it received between July 2011 and June 2014 had to do with payday loans. Of those 3,400 payday loan complaints CFPB received, 63 percent pertained to online lenders.

Contact reporter Cathy McKitrick at 801-625-4214 or cmckitrick@standard.net. Follow her on Twitter at @catmck.

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