Preet Bharara, the United States Attorney for the Southern District of New York, Karl Stiften, Special Agent-in-Charge of the St. Louis Field Office of the Internal Revenue Service (“IRS”), and Diego Rodriguez, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced the unsealing of a criminal indictment charging SCOTT TUCKER and TIMOTHY MUIR with violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”) and the Truth in Lending Act (“TILA”) for operating a nationwide internet payday lending enterprise that systematically evaded state laws in order to charge illegal interest rates as high as 700% on loans. Both defendants were arrested in Kansas City, Kansas, earlier today and will be presented in the United States District Court for the District of Kansas. The case has been assigned to U.S. District Judge Katherine B. Forrest.
Mr. Bharara also announced a non-prosecution agreement (the “Agreement”) with two tribal corporations controlled by the Miami Tribe of Oklahoma, a Native American tribe. As part of the Agreement, the tribal corporations agree to forfeit $48 million in criminal proceeds from TUCKER’s payday lending enterprise that are currently held in tribal bank accounts. The Agreement also acknowledges, among other things, that a tribal representative filed false factual declarations in multiple state court actions. TUCKER and MUIR used these false declarations to defeat numerous state enforcement actions seeking to enjoin the operation of their unlawful business.
Manhattan U.S. Attorney Preet Bharara stated: “As alleged, Scott Tucker and Timothy Muir targeted and exploited millions of struggling, everyday people by charging illegally high interest rates – as much as 700 percent. Tucker and Muir allegedly sought to evade liability by claiming that this $2 billion business was actually owned and operated by Native American tribes. But thanks to the investigative work of the FBI and IRS, this deceptive and predatory scheme to take advantage of the most financially vulnerable in our communities has been exposed for what it is – a criminal scheme.”
IRS Special Agent-in-Charge Karl Stiften stated: “These defendants allegedly used deceptive and misleading lending practices to prey on millions of hard working individuals seeking payday loans. In reality, these loan customers were taken advantage of and charged illegally high interest rates.”
FBI Assistant Director-in-Charge Diego Rodriguez stated: “As alleged, Tucker and Muir deceptively preyed on more than 4.5 million working people, including those in New York, to enter into payday loans with interest rates ranging from 400 to 700 percent. Not only did their business model violate the Truth-in Lending Act, established to protect consumers from such loans, but they also tried to hide from prosecution by creating a fraudulent association with Native American Tribes to receive sovereign immunity. This scheme, like so many others who swindle innocent victims, only ends with an arrest by the FBI.”
This article is about the city. For other uses, see New York City (disambiguation). For the U.S. state, see New York.
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. The city is referred to as New York City or The City of New York...
The U.S. Attorney for the Southern District of New York is the chief federal law enforcement officer in eight New York counties: New York (Manhattan), Bronx, Westchester, Putnam, Rockland, Orange, Dutchess, and Sullivan. Preet Bharara, who was appointed by Barack Obama in 2009 is the U.S. Attorney for the District. Bharara took over the post...
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