General Regulations For Tribal Lending Entities

There is currently an ongoing court battle to decide whether or not payday loan providers owned by Indian tribes are subject to federal regulations or whether they are protected by tribal sovereign immunity.

AMG Services
Recently, however, AMG Services, a Kansas payday loan provider founded and managed by Scott Tucker (known to race car fans as the recent winner of the Baltimore Grand Prix) has agreed to cease deceptive lending practices which government authorities such as the Federal Trade Commission declare to be in violation of federal laws.
AMG operates a payday loan service online under a variety of brand names. These include Ameriloan, OneClickCash, 500Fastcash, US FastCash, and UnitedCashLoans.

In most payday loans, borrowers are required to provide loan providers direct access to their bank accounts; lenders are supposed to withdraw the amount of the loan plus the interest in a single transaction. AMG, however, was accused of withdrawing only the amount of the interest for months, thereby increasing the amount of interest to be paid by the borrower. A loan of $300 may then cost a borrower almost a thousand dollars to clear the debt. According to the FTC, this practiced was not properly disclosed by AMG under the Truth-in-Lending Act.

AMG has declared themselves immune from such regulations, claiming to be owned by the Santee Sioux of Nebraska and by the Modoc and Miami tribes of Oklahoma. While the case awaits trial, FTC authorities had claimed that AMG persisted in its unfair practices, and continued to mislead new borrowers.

But with the agreement from AMG filed in federal court, the lenders will no longer force borrowers to provide direct access to their bank accounts. The loans will also be paid off in a single payment instead of being drawn over a period of months. In addition, AMG will no longer threaten their clients with jail time or litigation should they be unable to pay back the loan.

Court Battles

Payday loans are not universally available in the US. At least 17 states have laws in place which restrict or even forbid payday loans. Prior to the FTC’s case against AMG, the company has already been cited by authorities in several states. These authorities have accused AMG of going against state laws regarding payday loans, and the company has put up tribal ownership and immunity as a response to the allegations.

The position of AMG is that the FTC has no right to sue it and this case is pending in federal court. Other issues to be decided include the question of whether AMG is in violation of federal law. If that is the case, the issue of financial remuneration will also have to be decided.


The issue of tribal payday loans and short term finance offers is still an issue that requires further clarification. For the moment, if you are contemplating a quick loan, you may want to consider alternative options such as installment plans from credit unions. If payday loans are your only remaining option, make sure that you are clear with a particular lending company’s rules and practices, and try to pay off the loan as quickly as possible.