More than one million victims of an online payday lender called AMG Services will receive refunds totaling $505 million, the Federal Trade Commission announced Thursday, in the largest contentious settlement in the protection agency’s history. consumers.
The man behind the scheme, former professional racing driver Scott Tucker, began operating in a storefront in Kansas City in the 1990s. He regularly issued loans at interest rates of 700 to 1,000 percent , well above the legal limits for loans in states that regulate payday loans. It was relatively easy to add surprise fees because customers were required to pre-authorize withdrawals from their accounts to take out the loans, the FTC said.
Tucker also made a number of agreements with Native American tribes in Kansas and Oklahoma, believing that tribal sovereignty would protect him from state laws, the government noted.
Nearly 1.2 million refund checks will be mailed starting Thursday, the FTC said, six years after the agency first sued AMG and Tucker.
Consumers could be eligible for a refund if they took out loans between January 2008 and January 2013 from these seven companies, all affiliated with AMG: 500FastCash, Advantage Cash Services, Ameriloan, OneClickCash, Star Cash Processing, UnitedCashLoans or USFastCash.
Last year, a New York jury convicted Tucker on 14 counts, including racketeering. He is currently serving 16 years in prison. Tucker’s attorney and co-defendant, Tim Muir, was sentenced to seven years; Tucker’s brother, Joel Tucker, is currently facing indictment for packing fake payday loan wallets.