It found the median quote was $20, or 521 percent annual interest. Rates ranged from a low of 312 percent annual interest to a high of 913 percent, or $12 to $35 on a two-week $100 loan.

"Studies on interest rates charged by the Mafia in New York City in the 1960s found an average rate of 250 percent. So, payday lenders in Utah charge more than twice as much as the Mafia loan syndicates. It shows it has gotten out of hand," said Christopher Peterson, a native Utahn who is a law professor at the University of Florida, a national expert on high-interest loan industries.

"It is legalized loan sharking at its worst," complained Linda Hilton, coordinator of the Coalition of Religious Communities, who says local church groups see many people whose financial problems are worsened by the high-interest loans.

Don Hester, co-owner of the Debt Free Consumer Counseling service in Provo, said, "These payday loan companies are all bottom-feeders preying on the desperate, the uneducated, single mothers and the Hispanic population. . . . They take and take and take until the customer has to declare bankruptcy."

Michele Morin, a consumer protection lawyer in Salt Lake City, says that of the people she has helped with bankruptcy, "almost all of them had problems with payday loans."

Lenders disagree with critics. Frank Pignanelli, attorney and lobbyist for the industry's Utah Consumer Lending Association (and also a political columnist for the Deseret Morning News), says, "Payday lenders fill an important niche. Try walking into a bank or credit union and say you have withdrawn all your savings and maxed-out your credit card but want to borrow $300 for two weeks. They will send you to a payday lender."

He added, "People compute and figure it is cheaper to get a payday loan than to pay fees for a bounced check, or have a late utility payment, or fees for a late mortgage payment. That's why they proliferate here."

State regulators also say they do not feel payday loan interest rates are too high.

"Yes, the rates are high," Jaramillo said. "But they are disclosed on forms and orally as required by statute. People have to make a judgment whether that loan at that cost is in their best financial interest. Because of the volume of those loan products across the nation and here in Utah, they are making the judgment that it is."

A trap?

Critics and academics say payday loans can easily become traps to financially drain the unwary.

Peterson, the University of Florida law professor, says he began years of research on the industry after he worked a few months in Utah before law school as a collector for a payday lender. "I have been doing penance for that ever since," he said.