Pennsylvania Payday Lender Sentenced to 37 Months in Prison
Inside Subprime: Aug 20, 2018
By Ben Moore
Adrian Rubin, a payday lender from Jenkintown, Pennsylvania, was recently sentenced to 37 months in prison and ordered to pay over $20 million in penalties after being convicted of running illegal payday lending businesses, as well as offering fake credit cards to poor credit shoppers. Under the sentencing, Rubin must pay $10 million in restitution and $100,000 in fines. Rubin must also forfeit over more than $10 million in assets.
Rubin spent a year in prison in 1997 for tax evasion before he got his start in the payday lending industry. Due to his criminal past, Rubin was unable to open loan companies under his name, so he forged his father-in-law’s signature on the incorporation papers for the company he would use to distribute payday loans, short-term loans offered at high-interest rates which are typically borrowed by low-income customers in financial hardship. Payday loans are generally considered financially dangerous and can be difficult to escape due to the high costs of interest and fees associated.
It is believed that between the years of 1998 and 2012 Rubin owned multiple payday lending businesses, all of which were violating loan usury laws. But Rubin didn’t stop his predatory practices with his payday lending schemes. Once Rubin was making millions offering high-interest payday loans to borrowers, he and his sons, Chase Rubin and Blake Rubin, began a business offering worthless credit cards to people with bad credit. The credit cards required upfront payments between $69-99 and came with a hefty $19 monthly fee. The catch was that the credit cards only worked on a handful of online sites offering off-brand products in bulk.
Initially, Rubin revelled in the millions he was making, and saw his low-income customers as a simple, but recognizably illegal, way to make large profits (in Rubin’s first year, he made more than $2 million). However, he began to realize the error of his ways and soon began to work with the FBI to appease his conscience. Rubin recorded others in the payday lending industry and most notably testified in court against two of the country’s top payday lenders, Charles M. Hallinan, who helped kickstart Rubin’s career in payday lending, and Scott Tucker. Both men are now serving prison terms after being found guilty of illegally preying on low-income borrowers. In addition to his cooperations with the FBI, Rubin also purchased multiple payday loan businesses across the country with the sole intention of forgiving each company’s entire borrower debt.
U.S. District Judge Eduardo Robreno, the judge who sentenced Rubin to prison, struggled with the appropriate punishment for Rubin, who described himself in court as a “horrible person trying to become a better one.” The judge asked the court, “Who is Adrian Rubin? Is he the criminal who engaged in criminal activity over a long period of time, or is he the informed cooperator who cooperated against several co-defendants and helped take down a pernicious industry? Even Mr. Rubin probably doesn’t know.”