Kansas City businessman accused of creating fraudulent payday loan portfolios

Inside Subprime: July 3, 2018

By Lindsay Frankel

Joel Tucker, a Johnson County businessman who sold payday loan information to debt collectors, now faces 15 felony counts in connection with his payday loan activities. The indictment comes after a Kansas City judge awarded the Federal Trade Commission $4 million in a judgment against Tucker.

Tucker’s indictment is the latest in a series of fraudulent schemes surrounding payday loans in Kansas City. His brother, Scott Tucker, was convicted on 14 counts for running an illegal payday loan operation and was sentenced to 16 years in prison. Scott Tucker’s payday lending businesses charged interest rates that were illegal, among other deceptive practices. His lawyer was also convicted and received a seven-year prison sentence.

“For more than 15 years, Scott Tucker and Timothy Muir made billions of dollars exploiting struggling, everyday Americans through payday loans carrying interest rates as high as 1,000 percent,” said U.S. Attorney Joan Loughnane in a written statement.

More recently, Richard Mosely Sr. was sentenced to 10 years in prison for his part in a payday loan scheme that defrauded still mroe Kansas City borrowers, and the city’s sordid history of fraudulent payday lenders continues with Joel Tucker.

Unlike his brother, Joel Tucker didn’t issue any loans to borrowers. Instead, he is accused of creating fake portfolios of payday loans to sell off to collectors. Collectors harassed consumers named in Tucker’s fake portfolios until many agreed to pay money they never owed in the first place. Buyers also used information provided by Tucker to file claims in bankruptcy cases.

But after several bankruptcy trustees around the country began to question payday loans from one lender, a judge began to investigate and Tucker’s scheme was revealed. Under the indictment, Tucker is called to give up $7.3 million in fraudulent gains.

Tucker is also accused of destroying information that needed to be preserved for his case and lying repeatedly to cover up his fraudulent activities. When U.S. Bankruptcy Judge Marvin Isgur ordered Tucker to prove the validity of the loans, Tucker lied that the information was stored on a computer in his Kansas City office to negotiate his release. He was videotaped while accessing the files, but Tucker’s dishonesty continued as he neglected to retrieve the information.

Tucker now faces charges of interstate transportation of stolen money, falsification of records, and bankruptcy fraud as a result of his deceptive and illegal business practices.

Even payday lenders in Kansas City that operate within the limits of the law receive criticism from consumer advocates for their exploitative practices. Payday loans in Kansas cost borrowers an average annual interest rate of 391 percent, which can make it difficult for low-income individuals to pay back their loans. This leads to ongoing debt for families who already struggle to make ends meet.

For more information about payday lending in Missouri and Kansas, check out these related pages and articles from OppLoans:

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