Crime

Feds add tax evasion charge against alleged fake debt seller Joel Tucker of KC

The vicious debt trap of payday loans

Elliott J. Clark, 65, of Kansas City, MO, spent five years caught in the debt trap of payday loan interest when his wife's broken ankle began his high-interest cycle trap.
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Elliott J. Clark, 65, of Kansas City, MO, spent five years caught in the debt trap of payday loan interest when his wife's broken ankle began his high-interest cycle trap.

After finding that Prairie Village businessman Joel Tucker allegedly spent money on luxuries like private jets, a Cadillac Escalade and a private club in Vail, Colorado, without paying millions in outstanding tax liabilities, authorities added a tax evasion charge to his legal troubles.

Tucker, who was indicted almost a year ago on several counts related to a scheme where he allegedly sold bogus consumer debt portfolios, was charged this week in a superseding indictment with tax evasion. The new charge alleges he received business income and loans, did not report it on his taxes and did not pay down more than $8 million in outstanding taxes, penalties and interest.

Tucker is the brother of Scott Tucker, the payday loan mogul whose illegal $2 billion enterprise was said to have exploited 4.5 million borrowers through exorbitant interest rates and deceptive loan terms. Scott Tucker is serving a prison sentence of more than 16 years following a conviction for an array of charges, including racketeering. He’s currently in custody in Leavenworth.

Joel Tucker and his federal public defender, Anita Burns, were not immediately available to comment on the new indictment filed in federal court on Tuesday. Tucker pleaded not guilty to the original charges.

The tax evasion charge says Tucker and the Internal Revenue Service agreed in 2014 that he had more than $8 million in assessments, penalties and interest due from his income taxes in 2007 and 2008.

From 2014 to 2016, Tucker made $7.3 million through selling allegedly fake payday loan debt portfolios to debt brokers, according to the indictment. Those brokers would then call people who didn’t owe anything to try to extract payment, many of whom would end up paying anyway.

The scheme was brought to light by a Texas bankruptcy judge who noticed a glut of consumer bankruptcy cases where recurring payday loan debts could not be reconciled by the creditors. Those creditors pointed to Tucker as the alleged origin of those debts. Tucker was subsequently charged with bankruptcy fraud, in addition to the original charges he faced.

The $7.3 million Tucker made in the alleged debt scam did not result in any payments toward his outstanding tax liabilities. The indictment says the only payment that the government has received was $512 that was obtained through a levy on one of his bank accounts.

During that time, however, the government alleges that Tucker spent lavishly on various luxury items, including:

$105,367 to buy a Cadillac Escalade in 2015;

A $1.59 million lease purchase agreement on a Prairie Village home;

$226,000 on private charter jets, with most of the flights departing from and arriving in Kansas City;

Nearly $200,000 in cash withdrawals;

Lease payments exceeding $75,000 to Porsche Financial and Ferrari Financial;

More than $17,000 on The Arrabelle, a lulxury hotel in Vail;

Payments of $50,000 to the Vail Mountain Club, a private club.

Tucker allegedly told an IRS agent in 2016 that he had no income, despite receiving $940,000 in bank accounts he controlled that year.

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