On April 4, 2016, Prairie Village businessman Joel Tucker was seated in the witness stand of a Houston courtroom when a federal judge gave him this admonition:
“If I were you, I’d start taking this seriously,” said Marvin Isgur, a U.S. bankruptcy judge for the Southern District of Texas.
Isgur and other bankruptcy judges had noticed irregularities in personal bankruptcy cases all around the country. Debt collectors were having trouble substantiating their claims that they were owed money — $390 in each case — by people who declared bankruptcy. Isgur opened an inquiry to get to the bottom of it, which led him on a path to Tucker.
“If I were you, I’d start listening to my lawyer,” Isgur continued. “If I were you, when I got asked a question by a federal judge, I would no longer give evasive answers. Do you understand?”
“Yes, sir,” Tucker replied.
The Houston case was the beginning of a particular legal problem for Tucker, the brother of imprisoned payday loan tycoon and former professional race car driver Scott Tucker. Joel Tucker himself had ties to payday lending in Kansas City, an industry that attracted the attention of civil and criminal authorities over the last decade for business practices that stretched the limits of the law.
That legal saga was supposed to come to an end Thursday for Tucker. He had pleaded guilty to several criminal charges stemming from his sale of bogus consumer debt portfolios to bill collectors and for evading millions in taxes.
But Tucker didn’t show up to his sentencing before a federal judge in Kansas City. A warrant was issued for his arrest.
In court, Tucker’s lawyer cited a family emergency in Colorado as the reason for his client’s absence. Asked by The Star about the nature of the situation, Tucker in an email declined to discuss it.
“Do you have anything else to do?” Tucker wrote.
From the time he was called to testify in Isgur’s court to the time the Federal Trade Commission sued him over the sale of bogus debt portfolios and his criminal case over the same matter, Tucker has engaged in a pattern of missing court deadlines, dodging questions from judges and not following court orders.
U.S. District Court Judge Roseann Ketchmark, who is presiding over Tucker’s criminal case in the Western District of Missouri federal court, set a new sentencing hearing for Tuesday. Whether Tucker shows remains to be seen.
Payday loan connections
The scheme that got Tucker in trouble was tangentially related to the payday loan industry. Yet Tucker’s ties to payday lending in Kansas City go deep.
Tucker was among the owners of a company promoted as a “one-stop-shop” for payday lenders called eData Solutions. It would sell to lenders the leads to potential borrowers, as well as provide software to manage all the loans.
In 2012, Tucker and others agreed to sell eData solutions to the Wyandotte Tribe of Oklahoma for $277 million. The tribe would pay for eData Solutions through the future profits of the enterprise.
According to federal prosecutors, Tucker kept with him a database full of consumer data that he obtained during his time owning eData.
At some point, Tucker got into the business of selling consumer debt portfolios. These portfolios are essentially spreadsheets or databases with the names of people who have unpaid bills. Debt collectors buy these portfolios for pennies on the dollar in hopes of having better luck getting the consumers to pay.
Diligent debt buyers purchase portfolios that include documents that verify the validity of the debts. But other portfolios can sell without this information.
Porania was one such company that bought debt portfolios, particularly from the payday loan industry.
In 2015, Porania was approached by a broker who said he had a database with 2 million consumer loan claims, each worth $390. Porania was told by the broker that the loans came from a company called Castle Peak, which made $300 payday loans to consumers and tacked on a $90 fee.
Porania bought 15,000 of these claims for about $72,500. And then the company started filing claims in bankruptcy cases around the country.
But within weeks, Porania discovered that several people who had filed bankruptcy were objecting to the validity of Porania’s claims.
Porania went back to the broker to see what the problem was. The broker had bought the debt portfolios from Tucker but, according to court records, did not receive any documentation supporting the validity of the claims.
Porania, suspecting a problem, withdrew its claims in the various bankruptcy courts.
Bankruptcy judges also noticed the pattern of consumer debt claims that couldn’t be substantiated and suspected some kind of fraud had occurred.
Isgur, the Houston judge, decided to investigate the matter in early 2016.
‘He has lied continually’
Isgur ordered Tucker to court in Houston to testify and to bring documents pertaining to the databases he sold to the debt broker.
Tucker did not appear in court the first time he was ordered to, and a lawyer he hired asked the judge to schedule another hearing a week later. He didn’t show up for that hearing, either, nor did he submit the documents the judge wanted to see. Isgur issued an arrest warrant for Tucker.
Tucker did show up to an April 4, 2016, emergency hearing.
The judge asked Tucker’s lawyer if Tucker brought the debt documents. The lawyer said no.
“How long have I ordered him to produce these documents?” Isgur asked. “And today he’s showing up without documents and expects to not be taken into custody?”
Tucker was called to testify. He was first asked why he did not show up when he was initially ordered to testify the previous month.
“I was not clearly understanding the very serious matter of this case,” Tucker said, adding that he missed the following date he was ordered to testify because he was sick.
In explaining why he did not bring the documents contained in the judge’s order, Tucker said he needed time to go through all of it. His description of the judge’s order to bring documents as a “request” appeared to irritate Isgur.
“It’s not a request, it’s an order,” Isgur said.
“Your order,” Tucker replied. “I’m sorry, Judge.”
“You’re going to start understanding that there’s a difference between somebody asking nicely and a court compelling you to do something where you decide not to comply,” Isgur said.
“Yes, Judge,” Tucker said.
“There’s a big difference,” Isgur said.
“Yes, Judge, I —” Tucker started.
“Start getting it into your head,” Isgur said.
“I got it very clearly, Judge,” Tucker said.
“No, you don’t,” Isgur said, “because you haven’t complied yet.”
When asked about the debt sale to Porania and another company, Tucker said he was not involved.
Tom Kirkendall, Porania’s attorney, pressed Tucker on that point.
“Do you want to rethink that answer, sir?” Kirkendall said.
Tucker eventually conceded that he received money from the broker in exchange for the portfolio.
“So your earlier testimony that you weren’t involved in the transaction of selling these claims to my client, that was just false, wasn’t it?” Kirkendall said.
Soon after, the court took a break after Tucker asked to talk to his attorney. When the hearing resumed, Tucker stopped answering questions by invoking his Fifth Amendment right to not incriminate himself.
At the end of the hearing, Isgur ordered U.S. Marshals to take Tucker into custody until he could produce the documents from the judge’s order.
Later that day, Tucker’s lawyer persuaded the judge to set his client free so he could retrieve the documents. The judge said he was going to notify the FBI and U.S. attorney’s office that a crime may have occurred.
“It’s up to them as to what to do about that,” Isgur said. “But it is my statutory duty to make that report.”
A month later, Tucker was brought back to Houston to testify in another hearing after he did submit some of the documents from the court order.
Tucker underwent hours of cross examination, and his answers appeared to frustrate lawyers and the judge posing the questions.
“He has lied continually on the stand, sometimes even from minutes to minutes,” Kirkendall said toward the end of the hearing
Isgur became suspicious about Tucker’s testimony and the documents that were submitted to the court.
“I just think this is one of the strangest hearings I’ve ever been in where the witness gleefully testifies he invents things,” Isgur said. “It’s just the strangest thing.”
FTC gets involved
The Federal Trade Commission, a consumer watchdog agency, sued Tucker in 2017 over his sale of phony debt portfolios. The FTC said that the portfolios Tucker sold included debts that the people listed never owed. At other times, Tucker sold debts that he never actually owned.
U.S. District Court of Kansas Judge Julie Robinson handled the FTC case against Tucker.
Like in the bankruptcy case, Tucker was ordered to supply documents regarding the loan portfolios to the FTC.
During a Feb. 9, 2017, hearing in Kansas City, Kansas, in which Tucker showed up without a lawyer, Robinson asked why he hadn’t supplied the documents.
“I’ve had a lot of roadblocks in the sense of retaining counsel for this case from a financial position that I am in,” Tucker said. “All the counsel that I’ve talked to are asking for a $100,000 retainer in this case, which I financially do not have.”
According to sentencing memorandum written by federal prosecutors in Tucker’s criminal case, Tucker was living a lavish lifestyle around that time.
The memo said that between January 2015 and July 2017 — a period that includes the hearing in which Tucker told the judge he was not in a financial position to afford an attorney —Tucker had paid $682,437 to American Express. During that same period, he made lease payments to Ferrari Financial and Porsche Financial for his personal cars. He also spent $226,000 on private jets during that period.
The FTC eventually obtained a $4 million judgment against Tucker. The FTC sent him a demand letter requesting he pay the judgment, but a spokesman for the agency said Tucker has not responded.