Payday-Lending “Godfather” Used Straw Lenders to Commit Fraud

To quote the movie “The Godfather,” “Behind every successful fortune, there is a crime.”

According to the U.S. Department of Justice, Charles Hallinan was dubbed the “Godfather” as he taught others how to defraud those seeking a payday loan by charging fixed fees and high interest rates in excess of what state laws permitted. That allowed this Godfather to net more than $68 million between 2007 and 2013, with his activities from 1997 to 2006 not included in this incredibly high-valued fraud.

Within the web of schemes, Hallinan used straw lenders, which set up fictitious lending arrangements between the customers and legitimate lenders. Hallinan established fake partnerships with a federally insured bank and Native American tribes to aid in his scheme.

This Godfather was sentenced to 168 months in prison. Hallinan, 77, would be 91 when released.

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Julia is a director in BKD’s Forensics & Valuation Services division. She focuses on forensic accounting, fraud investigation, litigation support services and business valuation. With nearly 20 years of public accounting experience, Julia has gained a substantial background in both audit and tax services.

She has extensive experience in forensic services and litigation support. She has successfully worked with complex risk assessments and public corruption investigations, misappropriation of assets and fraudulent financial reports in a variety of industries, including health care, manufacturing, transportation, real estate, IT consulting, government and not-for-profit. Julia performs valuations for transactions, litigation, restructuring, marital dissolutions and income tax-related purposes.

Julia Mast – who has written posts on BKD Forensics.


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