On July 17, 2025, The Santa Fe New Mexican published a feature by reporter Daniel Chacón covering former State Representative Tara Jaramillo’s response to the allegations outlined in the Southwest Public Policy Institute’s June report, Black Market Payday. Jaramillo denies wrongdoing and stated her intention to sue her accuser, her cousin and business rival.
Daniel’s covereage and reporting is always thoughtful, but it’s important to clarify the facts and expand on the substantial documentation and evidence that informed the Black Market Payday investigation.
Let’s set the record straight.
What We Found
SPPI’s Black Market Payday report revealed that Jaramillo, through her company Positive Outcomes, Inc., operated an unlicensed payday lending operation targeting her own employees, many of whom are low-income and Native American caregivers. Loans of $125 were issued with $135 repayments deducted directly from paychecks, amounting to a $10 fee (8% of the principal) with no required Truth in Lending Act (TILA) disclosures. Based on loan timing, these fees translated into effective APRs ranging from 208% to 2,920%. Nowhere in the source documents was there any loan issued at the 5% interest rate Jaramillo now claims. Her company is not licensed as a lender in New Mexico.
What made this exploitation not only possible but inevitable was the handiwork of special interest lobbyists like Fred Nathan, the pay-to-play architect behind Think New Mexico’s crusade for so-called “consumer protection.” Nathan’s well-funded lobbying blitz helped push House Bill 132 (2022) into law, slashing the allowable APR from 175% to 36%, a move that gutted the state’s already limited landscape of legal, regulated credit options for underserved, rural communities. Nathan and his cronies wrapped their agenda in virtue-signaling talking points, all while laying the regulatory groundwork for exactly the kind of underground lending racket Jaramillo exploited.
Let’s be clear: Fred Nathan’s brand of “reform” didn’t eliminate predatory lending: it deregulated it into the shadows. His sanctimonious assault on financial choice didn’t protect vulnerable New Mexicans: it stripped them of options, pushing them into the arms of unlicensed loan sharks like Jaramillo. If Nathan had spent less time cozying up to donors and more time understanding the actual credit needs of low-income communities, maybe caregivers wouldn’t be borrowing against their own paychecks at 2,920% APR just to survive.
The truth is simple: Jaramillo’s scheme flourished not in spite of New Mexico’s interest rate cap, but because of it, an unintended (but completely predictable) consequence of policies championed by self-righteous ideologues like Nathan who have never had to live paycheck to paycheck in rural New Mexico.
Coverage and Fallout
While many local outlets ignored the story, RedState was the first national outlet to shine a spotlight on SPPI’s findings with a detailed analysis titled “Progressive Payday? New Mexico Democrat Probed for High-Interest Loans to Workers”. That coverage was critical in driving attention to the issue and sparking overdue questions about political favoritism and regulatory inaction.
Following the RedState exposé, SPPI President Patrick M. Brenner joined Brandon Vogt on News Radio KKOB to discuss the findings in depth.
During the interview, Brenner detailed how:
- Documents obtained from whistleblowers and public records requests revealed a systemic, long-term pattern of unlicensed lending.
- Employees were trapped in cycles of debt due to automatic wage garnishment and lack of proper disclosures.
- Regulatory agencies, namely the New Mexico Department of Workforce Solutions and the Attorney General’s Office—failed to take meaningful action.
- Jaramillo’s campaign contributions to Governor Michelle Lujan Grisham, Attorney General Raúl Torrez, and Secretary of State Maggie Toulouse Oliver raise serious concerns about political protection and the lack of enforcement.
SPPI’s Position
Jaramillo calls the allegations “malicious and patently false.” But this is not a matter of opinion; it is a matter of evidence. We’ve reviewed over 7,000 pages of subpoenaed documents, check stubs, pay stubs, and correspondence. The case isn’t built on hearsay. It’s built on verifiable facts and the lived experiences of exploited workers.
Her threats to sue her accuser, who did the right thing by coming forward, reflect a broader culture of retaliation rather than accountability. If anyone is dragging reputations through the mud, it is the former lawmaker herself, who used her political connections to operate what is effectively a loan shark business in plain sight.
The Bigger Picture
This scandal is not isolated. It’s a direct consequence of New Mexico’s misguided price control legislation, specifically the 36% APR cap imposed by HB 132 in 2022. While well-intentioned, the cap drove legal lenders out of the state and created a vacuum, a black market for credit that Jaramillo stepped in to fill. Vulnerable New Mexicans, left without legal options, were forced to accept exploitative terms or go without.
As we wrote in Black Market Payday, “protection leads to exclusion—and exclusion leads to exploitation.” This is exactly what happened in Socorro, and it’s still happening across New Mexico.
Where We Go From Here
We call on New Mexico’s leadership to stop ignoring this issue and take immediate action to:
- Enforce state and federal lending laws.
- Investigate Positive Outcomes, Inc. for unlicensed lending and possible Medicaid fraud.
- Return campaign contributions from Tara Jaramillo and her affiliates to eliminate even the appearance of impropriety.
Anything less is a disservice to the workers harmed by this scheme and to the principles of justice and transparency in our state government.
