13. Billionaire Prepares for Prison: Scott Tucker, Episode 4

Scott Tucker wanted to build a scalable business since he was young. This is the fourth episode in our series on Billionaire Preparing for Prison.

In the first episode, we learned why authorities chose to prosecute Scott Tucker. He build the payday loan industry. The business he built grew to employ thousands of people. He generated billions in financial revenues and taxes. He created enormous wealth.

But authorities didn't like the model. Some people felt that he was earning too much money from people who could not afford to pay.

Scott saw things differently. People in the marketplace were telling Scott that they needed liquidity. They just needed a bridge loan to help them get across the hump. They may have suffered from car trouble. They may have had an illness. They may need a short loan. Banks refused to lend to those people. Scott created a company that would fill the void.

There was a lot of risk for that business. Many people chose to borrow money but they would not repay the loan. Scott didn't sue them. Instead, he just wrote off the loan. He created a system that would scale, expecting to cover the losses by operating at a scale.

Scott's company launched the entire industry because he was innovative. He leveraged technology. With the Internet, he could provide people with short-term loans in a matter of minutes. Yet the interest rates he charged exposed him to problems.

All that is clear at this stage is that a jury convicted scott of violating the Truth in Lending Act. As a result of the conviction, he faces multiple decades in federal prison. We recorded this fourth episode just before Christmas, in 2017. He is scheduled for sentencing on January 6, 2018.