Judge rules against Scott Tucker and AMG Services in FTC case
A few months back, we published a series that looked at Kansas City’s role as a hub in the world of predatory online lending. One of the biggest players in this shady industry is AMG Services, a company controlled by race-car driver and Overland Park resident Scott Tucker. Like many other online payday lenders, Tucker merged his company with a Native American tribe, giving AMG Services regulatory immunity that allowed it to continue its controversial business practices.
In 2012, the Federal Trade Commission filed suit against Tucker and AMG Services, alleging that the company threatened consumers over the phone while trying to collect debts. The two parties reached a partial settlement this past July.
Last week, Tucker – and by extension the entire online payday-lending industry – got bonked again. A U.S. District Judge ruled in favor of the FTC, affirming that AMG Services is within the reach of FTC enforcement actions, and that the commission has “the authority to bring suit against Indian Tribes, arms of Indian Tribes, and employees and contractors of arms of Indian Tribes.” Money quote from the FTC’s press release on the ruling:
“This ruling makes it crystal clear that the FTC’s consumer protection laws apply to businesses that are affiliated with tribes,” said Jessica Rich, Director of the agency’s Bureau of Consumer Protection. “It’s a strong signal to deceptive payday lenders that their days of hiding behind a tribal affiliation are over.”
Also last week, Mission, Kansas-based Geneva-Roth Ventures (controlled by Mark Curry) settled a class-action suit for unlicensed lending in Montana. The lead plaintiff in that suit took out a $500 loan from Curry’s company, paid $2,100 in fees over the next six months, and still owed the original $500 principal. As part of the settlement, Geneva-Roth will pay $233,000 to consumers and has agreed to stop lending in the state.
Full FTC/Tucker ruling here.
