Kansas City payday loan baron sentenced to 10 years in prison
Inside Subprime: June 19, 2018
By Ben Moore
A Kansas City, Missouri payday lender has been sentenced to ten years in prison after being convicted of running illegal practices out of his payday lending business.
Richard Moseley Sr., 73, was found to have used his collection of Kansas city-area payday lenders to prey on customers in poor financial conditions. Moseley used a variety of deceptive practices – including siphoning funds out of potential clients’ bank accounts before they even were approved for a loan – to fund his lavish lifestyle and build up his $220 million payday lending business. He also charged interest rates as high as 700 percent and utilized bank account payment deductions to only pay off accrued interest and leave his customers’ principle balance untouched.
Mosley was sentenced by U.S. District Judge Edgardo Ramos, who said that the payday lender was “a very rich man who stole from the poor.”
Moseley was able to keep the illegal activity hidden from even his attorneys, telling them the business was being run offshore, in either New Zealand or a Caribbean island. Prosecutors pointed out that, “the appearance of an offshore enterprise was [also] meant to frustrate state investigations into Moseley’s businesses,” which helped Moseley run the illegal franchise for more than ten years.
This latest conviction comes just after another Kansas City payday lender, local race car driver Scott Tucker, and his attorney, Tim Muir, were sentenced earlier this year to more than sixteen years in prison. Tucker and Muir were caught running their own nefarious payday loan enterprise, in a scandal that rocked the Missouri payday loan industry.
Tucker utilized what is called the “rent-a-tribe” loophole, in which payday lenders establish a business on American Indian reservations where state regulations are more lenient. In fact, several Kansas City payday lenders were cited by the Consumer Financial Protection Bureau (CFPB) for this practice, but no charges have been filed. One of the businesses included in the CFPB report was Silver Cloud Financial, a payday lender that received funding from a Kansas company incorporated by Richard Moseley Jr., the son of Richard Moseley Sr.
Moseley’s sentencing may be the latest in a much-needed crackdown on the payday lending industry in Missouri.