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Rep. Larry Wiley, D-West Valley City, is stepping forward with proposals to tighten regulations on Utah's payday-loan industry.

Former Rep. Brad Daw, R-Orem, is calling on legislators to crack down on payday lenders after House investigators found the industry secretly funneled big money to defeat Daw in retribution for running a bill it disliked. Lenders did that by using shell groups created by the campaign for John Swallow, who resigned as attorney general earlier this month.

Wiley said Friday he is finishing drafts of two bills similar to legislation Daw unsuccessfully pushed in 2012, attracting the wrath of payday lenders.

One draft bill would ban borrowers from having more than two payday loans at a time; limit them to no more than 10 such loans in a year; and allow loans to total no more than 25 percent of their monthly take-home pay, Wiley said.

Another would create a database that lenders could check to see how many loans a borrower already has, for what amounts, and how long the consumer has been paying on them.

Lenders now charge an average of 474 percent annual interest for such loans, state data show, although rates charged last year ranged up to a high of 1,564 percent interest — or $30 a week for every $100 loaned.

Wiley said he hears constant complaints about how payday lenders offer loans that people cannot repay without renewing every couple of weeks for the full 10 weeks state law allows lenders to charge interest. And then the lenders persuade borrowers to take out new loans to pay off the old ones.

"Payday lenders love to see loans rolled over. That's where they make the big bucks," Wiley said. "People roll them over them over two or three times and they can't pay it back" as interest accumulates.

Wiley said his bills would put "these payday lenders in a position where they have to pay attention to what's going on" with borrowers and whether they can truly afford to pay off loans on time.

"I do understand there is a need for quick loans, but there is a right way and a wrong way," he said. "And the process we have today preys on the vulnerability of working families and people in a pinch."

Investigators for a House committee probing misdeeds by Swallow said last week that payday lenders — upset by Daw running legislation to regulate them — acted to defeat him in a GOP primary by quietly funneling big money for attack ads through shell groups formed by Swallow's campaign.

Swallow helped the effort as a favor for big donations and support from payday lenders, investigators said.

Daw said Thursday that payday lenders so far have been unscathed in the Swallow scandals, and unless his old bill passes, lenders "are going to get away with everything they wanted."

Daw added, "If there's any justice in the world, that legislation will pass."

Wiley said what happened with Daw could help move his bills — but it also makes him wonder if payday lenders "will go after me for running this bill, too. If it causes my demise in the Legislature, I'm willing to accept that because this is something that needs to be looked at and addressed to help protect working families."