Sen. John Astle, D-Anne Arundel, defended his bill Friday that would allow for-profit debt management businesses to set up shop in Maryland provided they are licensed and regulated just like their traditional nonprofit siblings.
But Sen. Paul Pinsky, D-Prince George?s, questioned how well state regulations could prevent fraud among for-profit companies when the federal government is already in the middle of a large crackdown on nonprofit credit management companies that were actually making money.
“How is this good for the state?” Pinksy asked during a debate on the Senate floor.
He held up a list of people who testified on Astle?s bill before the Senate Finance Committee, implying that the committee approved the bill despite a large list of consumer advocate opponents.
Astle said many of the companies that had been caught illegally making money do not operate in Maryland, and he argued that upstanding nonprofit businesses still need some money to pay their employees.
Senators approved Astle?s bill with an amendment from Sen. Mike Lenett, D-Montgomery, that requires credit counselors be trained in financial analysis and budgeting so they can “do more than just push people into debt management services.”
