Villanova Man, 75, Indicted In $688M Payday Lending Scheme

A Villanova man has been charged by indictment for his alleged involvement in an illegal payday lending business that generated $688 million in five years, United States Attorney Zane David Memeger announced Thursday.

Charles M. Hallinan, 75, of Villanova faces two counts of conspiracy to violate the Racketeering Influenced and Corrupt Organizations Act as well as nine counts of international money laundering.

Wheeler K. Neff, 67, of Delaware was also charged in the case. Authorities say the pair also tried to pay off three Indian tribes so they'd pretend they were the payday lenders.

According to the indictment, Hallinan and Neff participated in a conspiracy that generated more than $688 million in revenues between 2008 and 2013 from hundreds of thousands of customers.

Hallinan owned or was involved with more than a dozen businesses between 1997 and 2013 that issued and collected debt from small, short-term loans that were commonly known as “payday loans” because the customers were supposed to pay them back with their next paychecks, Memeger's office explained in a statement.

Memeger alleges Hallinan charged $30 for every $100 they borrowed. "Pennsylvania and more than a dozen other states have passed laws criminalizing such loans as usurious," he said in the statement.

The indictment takes an interesting twist when it alleges that Hallinan and Neff conspired to evade the law by paying three Indian tribes to pretend that they were the actual payday lenders. They believed “tribal sovereign immunity” would shield them from law enforcement.

If convicted of all charges, Hallinan faces at least 12 years in prison, three years of supervised release, a possible fine, and a $300 special assessment.

The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service, and Internal Revenue Service Criminal Investigations.

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