Former Business Mentor to Scott Tucker Suffers Same Fate in Federal Court for Rent-a-Tribe Scheme

On November 26th a federal court jury in Philadelphia found former payday lending mogul Charles Hallinan and his business attorney Wheeler Neff guilty of racketeering and fraud. Hallinan was convicted for utilizing the same illegitimate business model made famous by another payday lender, Scott Tucker, whom Hallinan helped break into the industry more than a decade ago.

Like Tucker, Hallinan funnelled his payday loan business through shell businesses he helped organize through tribal governments. Hallinan installed a server at tribal offices in California where loan applications were supposedly being processed. In actuality, the server was connected to nothing, and everything was handled from Hallinan’s central offices on the east coast. Similarly, Tucker would have call center employees pretend to work from tribal lands in Oklahoma and Nebraska to give borrowers the impression his operations were on the reservation.

As one tribal business representative testified when Hallinan’s deceit became clear, the tribe ended its relationship with him. Hallinan later wrote in an email to his attorney: “if these guys are serious about their responsibilities, then we’re dealing with the wrong tribe.”

Hallinan and Neff are scheduled for sentencing in April. Tucker will learn his fate in January. All are expected to receive steep fines and jail time. Hopefully the convictions of Tucker and Hallinan put to rest a business model that is far from sustainable and help tribes enter a new era of lending.