The Kansas City Star, Feb. 12
Rise and fall of payday lenders a sobering Kansas City story:
Two area businessmen and a lawyer who became very rich very quickly by tricking low-income consumers with sky-high fees and interest rates on online loans finally face criminal charges.
About the time Scott Tucker, Richard Moseley and lawyer Timothy Muir were making court appearances in this area on Wednesday, officials in New York unsealed indictments describing elaborate usury schemes that took place openly and in polite society in Kansas City.
“The Tucker Payday Lending Organization was an organized criminal group with leadership based in Overland Park, Kan., and that operated throughout the United States,” one indictment stated.
About Moseley, FBI official Diego Rodriguez said in a press statement, “This case is an example of predatory lending at its finest.” KC payday lenders Scott Tucker and Richard Moseley Sr. indicted in federal crackdown
At its worst, actually. The federal indictments detail huge enterprises that for years got away with making loans to people in desperate circumstances, then claiming much more than the value of the loans in interest and fees.
And they aren’t the only ones. Tucker’s early success in Internet lending spurred a host of copycat businesses in this area.
The boom years saw a number of newly rich lenders purchasing Johnson County mansions and luxury vehicles. The ill-gotten riches even flowed into Catholic parish and school projects.
In August 2013, U.S. Reps. Kevin Yoder of Kansas and Blaine Luetkemeyer of Missouri were lead signers of a letter to then-U.S. Attorney General Eric Holder, protesting his efforts to stop banks from processing online payday loans. Not surprisingly, both GOP congressmen, as well as Republican U.S. Rep. Lynn Jenkins of Kansas, are among the top House recipients of payday loan donations.
But nobody around Kansas City is flashing the largess of predatory lending these days. At least eight area businessmen, apart from Tucker and Moseley, are under investigation by federal agencies.
The noxious operations, which once employed hundreds of persons in the area, closed so quickly and quietly it was as though they evaporated.
The support structure that provided investment capital and technical expertise to the online lenders reportedly is seeking more legitimate opportunities in area start-up businesses.
The indictments of Tucker, Moseley and Muir, Tucker’s lawyer, shed light on the scale of the enterprises and why it took so long to hold people accountable.
Tucker and Muir ran a $2 billion business that Tucker started as early as 1997, authorities allege. It preyed on more than 4.5 million people. The business operated under a dizzying array of names. Tucker’s great scam was to convince Indian tribes to shield him by allowing him to represent himself as one of their “employees.” That enabled him to elude enforcement efforts of attorneys general in multiple states.
Moseley deceived about 600,000 persons with high-interest loans, the indictment against him alleges. He, too, operated his business under multiple names and he falsely claimed, even to his attorneys, that the loans were being made by employees stationed in Nevis, a Caribbean island, and New Zealand. The business was run from Kansas City.
A shocking allegation in the indictment is that many of the people Moseley is accused of defrauding never even asked for a loan. They provided some crucial information to a “lead generator” website, enabling the operation to get into their bank accounts and withdraw money.
Moseley, Tucker and Muir are accused of violating federal racketeering laws as well as the U.S. Truth in Lending Act. But they also broke usury laws in multiple states, officials allege.
One reason the indictments came out of the U.S. Attorney’s office in New York City is that New York has a criminal law setting a lending limit at 25 percent annual interest. With that stringent cap, authorities had no difficulty establishing that the online payday loan businesses were violating consumer protections.
Enforcement is more difficult in Kansas and especially Missouri, where the average annual interest rate on payday loans is an outrageous 455 percent.
Attorney General Chris Koster took action a year ago against an online loan operator who broke Missouri law by charging excessive fees and denying due legal process for collecting overdue costs. In general, though, payday lending is an open field in Missouri.
Federal authorities are now swooping in to seize what they claim are proceeds of the alleged crimes of Kansas City’s audacious online lenders. They are looking to clean out numerous bank accounts controlled by Tucker, as well as acquire his Colorado vacation home, six Ferrari race cars, four Porsche automobiles and a Learjet.
The collapse of Kansas City’s payday loan bubble under the squeeze of federal enforcement has broken up families and caused rifts in churches, country clubs and executive suites.
Too many people and institutions here were too quick to embrace the new “entrepreneurs” when they showed up with fancy cars and quick cash. Too many people didn’t want to think about the misery at the other end, as consumers were harassed to pay interest and fees they couldn’t possibly afford.
Now it’s payday, all right. And it should serve as a cautionary tale.
St. Louis Post-Dispatch, Feb. 15
If St. Louis wants to win NGA, message must be loud and clear:
The cutthroat competition has begun to determine whether the National Geospatial-Intelligence Agency keeps its western campus and 3,100 jobs in St. Louis or moves across the river to St. Clair County. Last week, just as President Barack Obama was visiting Illinois, that state’s entire congressional delegation launched a campaign to lure the NGA to a semi-rural site adjacent to Scott Air Force Base.
The time for a forceful and unrelenting rebuttal is now. Missouri officials and insiders say they’ve chosen a quieter, low-key lobbying campaign, assuming NGA’s leadership prefers it that way. After all, this is the secretive agency whose satellite imagery and mapping have guided the CIA’s and Pentagon’s most sensitive operations.
Low-key might have been understandable before. But the stakes are too high for Missouri’s elected leaders in Washington to be outplayed by their Illinois counterparts.
It’s not just about keeping 3,100 permanent NGA jobs. This $1.6 billion project promises to create thousands more construction-related jobs, not to mention the massive redevelopment potential for the north St. Louis neighborhood where the new campus would go.
What’s the best way to pitch St. Louis’ best case so that Washington gets the message, loud and clear?
First, those organizing this campaign should disabuse themselves of the notion that Washington prefers anything low-key. Whenever major defense contracts are up for grabs, sensitive or not, the pages of The Washington Post and New York Times explode with full-page ads from competing contractors. They buy big ads on the Sunday morning television interview shows because they know that’s when Washington is watching. There’s nothing subtle about it.
Although NGA Director Robert Cardillo will make the final decision, expected in March, it can’t hurt to publicly remind Obama of commitments he’s made to uplift the urban core of troubled American cities. He’s talked up his Promise Zones and Strong Cities initiatives. He has pledged to give a priority in federal contracting to help cities like St. Louis stop the steady migration of residents to the suburbs.
America doesn’t need investments to uplift Illinois corn fields.
Expect the other side to play hardball. Obama’s longtime friend and Democratic political mentor, Illinois Sen. Dick Durbin, accompanied the president on Air Force One ahead of the president’s speech to the Illinois Legislature. All politics is local, and Durbin will use every ounce of personal influence he can to win the NGA.
When Mayor Francis Slay traveled to Jefferson City on Feb. 2 to discuss this high-stakes competition, the bipartisan support he received was resounding.
“Whatever you’ve got to do, go get it and we’ll back you up on the cost,” Republican Sen. Ron Richard of Joplin, the Senate president pro-tem, told Slay.
The mandate couldn’t be clearer: Go big and loud. And do it now.
St. Joseph News-Press, Feb. 11
Bring on bricks and mortar:
Collecting taxes on online purchases is a matter of fairness. The sooner local taxpayers figure out they are the ones being treated unfairly, the sooner we will develop a consensus to do something about it.
A study from consultant Civic Economics drew headlines this week when it reported Missouri missed out on $60.2 million in sales tax revenue from online retailer Amazon in 2014. This was the highest total in the country, due to the fact Missouri is the most populous of the 22 states in which Amazon doesn’t collect sales tax.
The online giant justifies this on the basis it doesn’t have a physical store or other facility in the state, and so it believes it is not obligated to collect sales taxes on purchases by Missouri residents.
Customers of local brick-and-mortar businesses pay to sustain community services such as schools and police; customers of Amazon and businesses like it don’t.
Without $60.2 million in lost revenue, everyone who shops and pays tax in Missouri is forced to pay more to make up the difference. Either that, or we must choose to live with lesser funding for schools, police and similar necessities.
The trends in e-commerce growth suggest things will only get worse. Also, the calculation of lost tax revenue applies only to Amazon; there are a number of other large online retailers that also refuse to remit sales taxes.
One way to address this problem is for Congress to pass the Marketplace Fairness Act, which would enable all state governments to enforce collection of taxes by online retailers.
A second option offers no guarantee to Missouri. Amazon in November opened a physical bookstore in its hometown of Seattle. The company is said to be weighing a plan to eventually open up to 200 stores, but does not confirm this.
To think: Without Congress taking decisive action to level the playing field, we’re left with hoping Amazon will invest in a store or distribution center in our state - for no other reason than to allow us to collect sales taxes needed to support local services.
Jefferson City News-Tribune, Feb. 13
Half-measures shortchange safe driving:
Missouri senators revisited the theme of finding the proper balance between government oversight and personal freedom this week.
The occasion was Senate committee discussion of three roadway safety bills concerning seat belt use, texting while driving and helmet requirements for motorcyclists.
We believe the overall argument has been settled; existing state laws on all three topics demonstrate the state does have an interest in motorists’ safety.
Proposed changes to existing laws include:
- Two Senate bills would prohibit texting while driving for all motorists. The ban now applies only to motorists under age 22 and to commercial drivers.
- A separate Senate bill would make failure to wear a seat belt a primary offense. The failure now is a secondary offense, which means another offense must be the reason for a traffic stop. An unrestrained driver, however, also may be cited for failure to wear a seat belt. The proposal also would extend the requirement to adult passengers in back seats.
- Another bill would allow motorcycle riders who are at least 21 and have health insurance to ride without a helmet, as long as they have been licensed for two years or have completed a safety class.
Existing laws on seat belt use and texting while driving are partial measures. The message is safety applies only to certain people under certain circumstances.
We favor the proposed changes on these two issues as a means to make the laws fair and equitable for everyone.
Applying that logic, we oppose changing the motorcycle helmet law because it would transform an equitable law into a half measure. If approved, the safety measure would apply only for certain motorcycle riders who meet certain criteria.
On matters of public safety, half measures are insufficient. The law doesn’t give certain motorists the personal freedom to ignore stop signs or red lights.
Driving is not a personal freedom. It is a privilege that requires obtaining a license and obeying the rules so everyone can share the roads safely. Let’s make the rules consistent for everyone.
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