Racer Scott Tucker agrees to pay $21 million in payday loan settlement
Photo by LAT PHOTOGRAPHIC
Level 5 Motorsports owner/driver believed to have funneled $40 million to his racing operation
Payday lending companies affiliated with Scott Tucker, a racecar driver on U.S. and European circuits, settled U.S. claims that they charged consumers undisclosed and inflated fees.
AMG Services Inc. and MNE Services Inc. will pay $21 million, the largest recovery in a payday lending case brought by the Federal Trade Commission, the agency said Friday in a statement. In addition to the $21 million penalty, AMG and MNE will waive $285 million in charges assessed against consumers but not collected, the FTC said.
“The settlement requires these companies to turn over millions of dollars that they took from financially-distressed consumers,” Jessica Rich, director of the FTC’s bureau of consumer protection, said in a statement.
Brad Weidenhammer, an attorney for AMG and MNE, didn’t immediately respond to a phone message seeking comment.
Sports-car race team owner Scott Tucker facing racketeering indictment, sources say
Federal prosecutors are preparing to bring charges against payday loan mogul Scott Tucker, better-known as a racecar driver on U.S. and European circuits,
for deceiving borrowers about the cost of.
The FTC sued AMG and other companies affiliated with Tucker in 2012, alleging they piled on undisclosed and inflated fees, and collected on loans illegally by threatening borrowers with arrest and lawsuits. Tucker is a signatory on the accounts of AMG and MNE and is an employee of AMG, according to the FTC’s complaint.
The FTC also said AMG and other companies also paid his personal expenses, including luxury cars, private jets and mortgage and maintenance of a home in Aspen, Colorado. The agency claimed that Tucker and his co-defendants regularly transferred tens of millions of dollars to Tucker’s racing company, known as Level 5 Motorsports, for what they called sponsorship fees that benefited Tucker’s automobile racing.
Tucker raced in the Rolex Grand-Am Sports Car Series from 2007-2011 and in the American Le Mans Series from 2010-2013. He appeared in one IMSA Tudor United SportsCar Championship race in 2014 –- the Rolex 24 Hours at Daytona.
Federal prosecutors are preparing to bring charges against Tucker for deceiving borrowers about the cost of loans, Bloomberg reported in December.
By David McLaughlin, BloombergSource: autoweek.com
Category: Payday loans