Consumer lenders, especially subprime lenders, would be making a big mistake if they viewed the new bills attacking "predatory" lending with complacency.

A drumbeat campaign against the practice is clearly under way, reinvigorated by front-page articles in The New York Times that were picked up by the TV networks. They detailed an array of reprehensible practices that a company called First Alliance allegedly engaged in.

Equity-stripping and similar practices have come under fire before, but rarely before have the general media suggested that the next links in the lending chain should take responsibility - should be held liable, in fact - for an originator's actions. The reports, which target the bond guarantor and the investment bank that took the company public and securitizes its debt, suggest that they are legally and morally responsible for any abuses at the point of sale.

This issue, which might be called the upward reach of culpability for predatory lending, has surfaced recently in other venues as well. At least one claim filed against a trustee in a securitization of subprime loans contends that the trustee is also responsible for predatory practices.

A regulatory campaign along the same lines has also just begun. FDIC Chairman Donna A. Tanoue argued in a speech in mid-February that banks that work directly or indirectly with predatory lenders are, in a sense, predators themselves. She said that she viewed this as a safety-and-soundness issue, and that she planned action to prevent insured depositories from buying paper from predatory lenders or otherwise working with them.

Most consumer lenders, insurers, and securitizers may say godspeed to the campaign against predatory lending - though feeling some qualms about what may be going on down the hall.

When presented as it was in the Times, predatory lending is easy to spot. Like pornography, most lenders know predatory lending when they see it. However, coming up with a binding and solid legal definition is about as easy as defining the difference between obscenity and art.

More often than not, it depends.

The trickiest bit in distinguishing between predatory and subprime financial activities is deciding whether a rate or fee is "too high." The practices alleged against First Alliance meet the know-it-when-you-see-it test - origination points of 25 or more, rates that go up 1% every six months, and so on. More modest rate and fee packages that exceed conventional norms are harder to judge.

Indeed, an interesting contradiction can arise when trying to categorize lending by the rates that are charged. Regulators have been pushing banks to be sure that loans are appropriately risk-priced. That means the higher the risk, the higher the rate of interest.

Calibrated properly, lending with risk-based pricing can be a profitable and sound business. It is also one with useful social implications. "Risky" borrowers are often new to credit or have impaired credit. Should they be cut off from loans - loans that sometimes put them back on their feet - because risk-based pricing sets their rates up a few notches?

The payday lending addressed in a new House bill can be just as problematic as predatory lending when it comes to definitions. There may well be broad agreement that payday lenders that get APRs above 300% week in and week out from customers who could use credit cards or other financial tools are, at least, questionable. However, what about customers at banks who borrow from time to time against their direct-deposited paychecks?

Some customers approach credit unconventionally because they know that they lack the discipline for traditional credit products, while others are willing to pay more to avoid hassles or time away from other tasks. Is that predatory, or are lenders offering these services just meeting a need? Is it paternalistic to tell customers who knowingly make use of alternative channels that they would be better off elsewhere - and then force them there?

Concerns about predatory lending are not new. Usury ceilings, of course, date back decades and were aimed at predatory lending by its old-fashioned name: loan-sharking.

The real problem with predatory lending now appears to be not so much its cost - which is covered by usury ceilings and other state and federal laws - but practices designed to disguise the true cost of credit. Once customers knowingly choose a credit product, even if is more expensive than others in the market, that choice should be respected if it is a free and informed one.

The challenge is to come up with a feasible legal framework that improves customer understanding without simply adding documents to the pile of papers that predatory lenders persuade customers to ignore.

Perhaps the place to start is not with new laws and regulatory standards, but with far tougher enforcement of those we have. That way, customers with valid claims against predatory lenders won't have to wait the years it is taking some plaintiffs to see their cases go to court.

Many of these plaintiffs can't afford to wait, or are too old to see their cases through. This encourages predatory lenders to delay and defy weak enforcement efforts.

Using the laws we have to tackle the problems we know might go a long way. Ms. Petrou is president of ISD/Shaw Inc., a consulting firm in Washington.

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