66 East Main Street, 3rd Floor Little Falls, NJ 07424

Godfather of Payday Lending Sentenced

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September 11, 2018

Background:

  • Hallinan was a former investment banker.
  • Hallinan was head of payday lending from 1997 from 2013.
  • Hallinan owned, operated and financed companies that issues small-amount, fixed-fee loans and collected debts in excess of $690 million
  • Dubbed “the Godfather of payday lending” by the media.
  • His entire business model was built on trapping his victims in an endless debt cycle.
  • Preyed on struggling borrowers.
  • Hallinan claimed in his defense: since he forged relationships with Native American tribes across the country, reasoning that through the federally recognized groups — which hold sovereign immunity to set their own regulations on reservation lands — they could continue to operate nationwide.

Court Ruling:

  • Charged fixed rates far in excess of what was permitted under states’ usury laws.
  • Hallinan was nothing more than a loan shark.
  • Hallinan was ordered to pay a forfeiture money judgment in excess of over $64 million.
  • Forfeited his interest in 1.2 million in funds in 18 bank accounts; two Mercedes Benz vehicles; one Bentley vehicle; and his Villanova, PA mansion.
  • Convicted of all 17 counts
  • $2.5 million in fines.
  • Sentenced to 14 years in prison
  • Judge described deals that Hallinan struck with their Native American partners “unlawful, a sham, and a fraud.”.

Hallinan’s payday has come.