The Center for Public Integrity will ask the Virginia Supreme Court to make public auto title lending reports that show financial details such as how much interest the businesses charge on loans and how often they repossess cars.
Last month, the Virginia State Corporation Commission, which oversees financial institutions in the commonwealth, ruled that the annual reports lenders file with the state should be released to the public. The commission said it’s not clear under state law if corporations enjoy the same privacy rights as people when it comes to the disclosure of financial information and directed its staff to seek clarification of the law from the General Assembly next year.
Three giant auto title lenders — TitleMax of Virginia Inc.; Anderson Financial Services LLC, doing business as Loan Max; and Fast Auto Loans Inc. — had asked Virginia officials to prevent the reports from being disclosed to the Center for Public Integrity.
Erin Witte, who is representing the Center for Public Integrity pro bono, filed a notice of appeal on Wednesday. The appeal goes to the Virginia Supreme Court. No date has been set for oral arguments.
Witte is an associate at the Fairfax, Virginia law firm Surovell Isaacs Petersen & Levy, PLC. Democratic State Sen. Scott Surovell, a longtime critic of Virginia title lenders, is a founding member of the firm.
The title-lender reports include detailed sales figures, volume of loans, interest rates charged on loans and defaults, as well as details on how often the lenders are cited by state and federal regulators. The reports don’t include any financial information about borrowers.
TitleMax, Loan Max and Fast Auto Loans submitted heavily redacted versions of reports earlier this year at the request of the commission. In its brief at the time, TitleMax argued the reports contain “trade secrets,” whose release could cause it “irreparable damage.” The others lenders also argue that disclosure would hurt their businesses.
The commission’s staff had recommended that the reports be released last year. But the three-member commission ruled on March 31 that state law is “ambiguous” on whether privacy rights for “personal financial information” should apply to national corporations.
The commission staff will continue to release aggregate summaries of the annual reports as it has done in the past. Doing that “strikes a fair balance,” the commission order said.
In Missouri, where all three of the Virginia title lenders also operate, financial reports are public records and anyone can request copies.
The Center for Public Integrity requested the annual reports from Virginia officials in November as part of an investigation into the costs of title loans nationwide. In Virginia, where nearly 500 title loan shops are operating, average interest rates were 222 percent in 2014, according to aggregate figures that Virginia releases.