The Silver Spoon: Tracy Rawle of Check City


Tracy Rawle took over payday lender Check City from his now deceased father but he has been intimately involved in the business for years, previously serving as the company’s vice president.

The late Richard M. Rawle was allegedly involved in a scheme to bribe Senator Harry Reid of Nevada in order to kill an FTC investigation of a now-indicted Utah businessman, and also is alleged to have illegally given $17,000 in gold coins to the former Utah Attorney General, who is currently facing numerous felony charges including bribery and receiving unlawful gifts.

The younger Rawle, who had that Utah Attorney General on payroll at his payday lending software company, recently attempted to quash a subpoena in connection with the investigation. In 2008, Rawle was fined $2,000 by the Commonwealth of Virginia for not receiving approval before acquiring more than 25% of a payday lending company.

Rawle has been at the forefront of fighting against regulations on the payday lending industry for years as spokesperson for the Utah Consumer Lending Association. He has fought against rate caps, legislation that was crafted with the AARP to crack down on payday lenders, and regulations that would have limited the industry’s ability to provide triple-digit APR loans to military families. He has repeatedly defended the industry’s high-interest rates, including the 417 percent APR that his own payday company charges on its loans.

Rawle has made quite the living off of the backs of hardworking men and women struggling to make ends meet. Others have benefited from Rawle’s success too. Over the years, Rawle has contributed at least $91,100 to the campaigns of powerful politicians special interest PACs that, in turn, contribute heavily to the campaigns of other elected officials.

The Details:

Rawle Took Over Check City from His Now Deceased Father, Who Was Allegedly Involved in a Scheme to Bribe Sen. Harry Reid

  • Rawle’s Father Was Allegedly Involved in an Attempt to Quash an FTC Investigation of an Online Marketing Company by Bribing Harry Reid; Reid Denied the Charge. “Fearing new regulations in the aftermath of the financial crisis, payday lenders decided to make a major play for the support of Senate Majority Leader Harry Reid. They contributed more than $126,000 to his campaign as the Nevada Democrat attempted to beat back a tea party challenge, hoping that the man who controls the Senate agenda would protect their interests. Their gambit didn’t stop the creation of a new Consumer Financial Protection Bureau, which Reid supported. And yet, it may have led to Reid getting linked to an alleged bribery scandal in Utah, involving state Attorney General John Swallow and indicted St. George businessman Jeremy Johnson. At the heart of both endeavors was the late Richard Rawle, a Provo, Utah, millionaire who built an empire of Check City locations, including more than 30 in Nevada. He was deeply involved in the federal lobbying campaign and told Johnson he could use his clout with Reid to help end a Federal Trade Commission investigation. The cost: $600,000. Rawle, in a deathbed affidavit, and Swallow, his former employee, say the Johnson affair was a standard lobbying effort that never got off the ground. Reid’s staff said he didn’t know about the plot and didn’t discuss it with Johnson or try to stop the FTC probe. Johnson, who is charged with a number of financial crimes, tells a far different story. He said Swallow convinced him Rawle was close enough to Reid to facilitate a bribe that would spare him and Johnson’s I Works company.” [Salt Lake Tribune, 5/12/13]

Tracy Rawle’s Father Is Alleged to Have Illegally Given $17,000 In Gold Coins to Former Utah AG Who Is Now under Arrest for Numerous Felonies Including Bribery

  • Former Utah AG Swallow Is Accused Of Accepting $17,000 In Gold Coins From Payday Lending Owner Richard Rawle. “Swallow is accused of accepting $17,000 in gold coins from Richard Rawle, the now-deceased owner of the Provo-based Check City payday-loan chain.” [Salt Lake Tribune, 7/19/14]
  • Swallow And Shurtleff Were Arrested And Charged With Numerous Crimes Including Some Related To A Pay-To-Play Scheme With Payday Lenders. “Former Utah attorneys general John Swallow and Mark Shurtleff have been arrested on corruption charges, the result of a two-year investigation. Both Swallow and Shurtleff were arrested at their homes, Salt Lake County District Attorney Sim Gill said at a news conference Tuesday morning. They were booked into the Salt Lake County Jail.” [Fox Salt Lake City, 7/15/14]
  • Swallow is charged with 13 counts: Pattern of unlawful activity, a second-degree felony; Accepting a gift, a second-degree felony; Receiving or soliciting a bribe, a second-degree felony; False statements, a second-degree felony; Evidence tampering, a third-degree felony; Misuse of public money, a third-degree felony; Obstructing justice, a third-degree felony; Falsification of a government record, a class B misdemeanor; Failure to disclose a conflict of interest, a class B misdemeanor. [Fox Salt Lake City, 7/15/14]

Rawle Asked a Judge to Quash Subpoena Of The Correspondence Of The Now-Arrested Former Utah AG with an Indicted Businessman during the AG’s Employment At Rawle’s Payday Software Company.

  • Rawle Asked a Judge to Quash Subpoena Of The Correspondence Of The Now-Arrested Former Utah AG With An Indicted Businessman During The Former AG’s Employment At Rawle’s Payday Software Company. “A payday loan software company that once employed Utah Attorney General John Swallow wants a judge to quash a subpoena it received from the Utah House special investigative committee. Provo-based Softwise Inc. deemed the demand for information as ‘nothing more than a fishing expedition,’ according to a motion filed Thursday in 3rd District Court. The motion contends the subpoena seeks confidential and proprietary documents that go well beyond the committee’s authority and raises issues of privacy, constitutional protection and free enterprise. ‘The subpoena demanded that Softwise produce a range of documents that are unrelated to Mr. Swallow’s conduct as the deputy or head of the attorney general’s office,’ Softwise President Tracy Rawle wrote in a declaration supporting the motion. Rawle’s father, the late Richard M. Rawle, founded the payday loan company Check City. Swallow introduced St. George businessman Jeremy Johnson to Richard Rawle in 2010 as someone who could arrange to lobby the Federal Trade Commission on Johnnson’s behalf. The FTC was investigating Johnson’s Internet marketing company, iWorks…Swallow also received $23,500 for consulting work on a cement plant project Richard Rawle had in Nevada. The House committee subpoena seeks, among other information, all communications between Rawle and Johnson and several others connected to Swallow. Softwise and House committee attorneys tried but failed to reach an agreement that would limit the documents the company would turn over. Tracy Rawle wrote that Softwise wants to work with the committee and has facilitated interviews with two witnesses, but also wants to protects its business. According to Tracy Rawle, Softwise produced ‘numerous’ documents in response to a request from the lieutenant governor’s office, which is looking into allegations that Swallow violated state campaign finance reporting laws related to his work for Richard Rawle. Tracy Rawle said the company couldn’t come to the same confidentiality agreement with the House committee.” [Deseret Morning News, 11/7/13]

Rawle Has Been at the Forefront of Stopping Many Proposed Regulations on the Payday Lending Industry in Utah

Rawle Served as a Spokesperson for the Payday Lending Industry in Utah – Was at the Forefront of Opposing Rate Caps and Bans on Predatory Loans to Military Families

  • Rawle Was A Spokesman For The Utah Consumer Lending Association, Claimed That The Industry’s Customers Were Happy With Payday Loans. “Utah regulators want to require ‘payday lenders’ to disclose more data that may help show whether they are fair firms offering emergency cash to those with poor credit or are essentially legalized loan sharks that trap the unwary into spiraling debt. ‘Additional data collection is probably warranted so we can better understand the industry in Utah,’ Ed Leary, commissioner of the Utah Department of Financial Institutions, told the Legislature’s Business and Labor Interim Committee on Wednesday. Leary endorsed legislative goals proposed by a working group of legislators and regulators studying whether more regulation of the payday loan industry is needed. The working group is proposing legislation to require payday lenders to report annually on data such as how many loans are really paid on time; how many loans are extended; what interest rates are charged; how many loans are made overall, and for what total amount; and in what zip codes or places are such loans being made… Payday loans are usually given for two weeks. A Deseret Morning News study in 2005 found that the median annual interest on them in Utah was 521 percent, or $20 for a two-week $100 loan. Critics contend the needy often cannot pay them off on time, and must take out more loans at the astronomic rates to cover them…Tracy Rawle, spokesman for the payday loan industry’s Utah Consumer Lending Association, told the committee it wants more time to study the proposal before it takes any stand on it. The association also wants to figure what it may cost to collect such data…Sen. Wayne Niederhauser, R-Sandy, said he has ‘problems with singling out a particular industry for a lot of scrutiny unless there are real problems there.’ Rawle contended that the industry has few such problems. ‘Of the million-plus transactions that we do a year, there are fewer than 30 complaints (to the state),’ he told the committee. ‘There is a reason people like our services and do use them, and a reason they don’t complain: They find a lot of value in what we provide.’” [Deseret Morning News, 10/18/07]
  • Rawle, A Spokesman For The Utah Consumer Lending Association Opposed Rate Caps And Claimed Competition Would Keep Rates “In Line” Despite The Fact That His Payday Lending Company Charged A 417 Percent APR. “For years, consumer groups have warned Utahns about the dangers of payday loans. Their success at urging legislators and city officials to crack down on an industry that charges an annual percentage rate of 400 percent or more for a quick short-term loan has been limited, though. Until now. In recent months, a host of cities along the Wasatch Front have either imposed limits on the number of payday lenders that can operate within their boundaries or are considering it. Salt Lake County is moving forward on a similar proposal. On the federal level, Congress passed a measure capping interest rates at 36 percent on payday loans for the nation’s military personnel after a number were denied security clearance because of high levels of indebtedness. Buoyed by all the momentum, legislators and consumer advocates are quietly laying the foundation for not one but several pieces of legislation. Together, they could provide sweeping reform of an industry that many say preys on the poor but that the industry contends meets a need that no one else can or will…Rate cap? No way. The payday loan industry’s trade group, the Utah Consumer Lending Association, says it might even support some of the measures, especially those designed to weed out bad operators and provide greater oversight of Internet-based lenders. But interest rate caps? No way. Tracy Rawle, a Check City vice president, said caps make no sense because ‘there’s a lot of competition to keep rates in line.’.. Plus, he thinks that looking at annual percentage rates is misleading. Check City, which is based in Provo and has 43 locations in Utah and four other states, charges $8 interest per week for every $100 borrowed. That works out to an APR – annual percentage rate – of 417 percent. But payday loans are not paid back over years such as with other types of loans. ‘Our average loan is for only 13 days,’ Rawle said. ‘There is no way to make that short term of loan for a low APR.’” [Salt Lake Tribune, 12/17/06]
  • Rawle Considered Interest Rate Caps “Unreasonable” And Opposed Them On Payday Loans To Military. “Despain and Rawle of Check City also consider interest rate caps unreasonable. ‘What do you think McDonald’s would do if the federal government told them they had to sell quarter-pounders with cheese for 14 cents to the military?’ He contends McDonald’s would halt such sales, and his company has decided it will stop lending to military personnel and their dependents once the 36 percent cap goes into effect late next year. Under that cap, he said he would be able to charge about 70 cents per week for every $100 borrowed instead of the $10 per week he charges now. ‘We can’t even cover our costs [of doing business] and overhead if we were to take in only 70 cents,’ he said. He said the public misunderstands payday loans, and he takes the industry’s argument about loan rates one step further. ‘These are high-risk loans.’ In other words, when a bank provides a car loan at a single-digit interest rate, that lender has collateral in the form of the vehicle’s title until the loan is paid off.” [Salt Lake Tribune, 12/17/06]
  • Rawle Claimed That Payday Borrowers Were Educated Enough To Know The Consequences. “Payday loan operators insist that borrowers know the consequences. Rawle, vice president of Check City, said nearly one-quarter of his customers are college graduates. More than one-third are homeowners. ‘Our customers are educated individuals who are capable of making a wise financial decision. It saves them money over more costly alternatives.’” [Salt Lake Tribune, 12/17/06]
  • Rawle Complained About Proposed Utah Legislation To Regulate Payday Lending Industry That Was Crafted With The Help Of The AARP, Claimed It Would “Kill Our Business.” “A state senator will sponsor a bill this legislative session that would regulate the so-called payday loan or fringe banking industry that has come to Utah. Sen. Ed Mayne, D-Salt Lake, is working closely with the American Association of Retired Persons on the legislation. ‘Some seniors, all they are living on is their Social Security check, and they start in their pattern of borrowing a week in advance,’ Mayne said. ‘And once they do that, they almost have to (borrow again) the next month. After about five months, (interest fees) could cost them their entire check.’ Utah is one of 12 states that place no restrictions on the businesses, which charge fees to cash checks and make loans on postdated checks. Nineteen states and Washington, D.C., have caps on fees and interest. Twenty states effectively prohibit payday loans by setting loan rates so low the businesses can’t survive. Utah would fall into the latter category should Mayne’s bill be enacted, said Tracy Rawle, co-owner of Check City Loan Center, which has outlets in Salt Lake City as well as in Virginia and Maryland. Besides restricting loan activity, Mayne’s bill would limit check-cashing fees to 3 percent of the face value of the check or $ 15, whichever is less. ‘That would kill our business,’ Rawle said…The AARP has become increasingly concerned about fringe banking because the federal government this year will convert all its payments to electronic deposits. Check-cashing outlets could become the depository of choice for the 10 million Social Security, Supplemental Security Income and pension-check recipients who don’t use banks, which are insured by the federal government and regulated. ‘I know a lot of people just don’t trust banks,’ said Mike Winton, AARP’s regional economic security representative. ‘Check-cashing outlets are comfortable and friendly. If seniors want to use check-cashing outlets, you can’t stop them.’ But Rawles said it’s easy for those who have other options to argue his services are not needed. ‘We are providing consumers with immediate cash for their needs,’ said Rawle. ‘Financial institutions don’t make loans like these. These are unsecured, short-term and a big risk.’ The Washington, D.C.-based Consumer Federation of America, in a survey of the industry, found payday loans’ short-term interest rates translate to annual percentage rates of 261 percent to 2,000 percent. Rawle said he charges a transaction fee not interest and to calculate it as interest is misleading.” [AP, 1/11/99]

Rawle Was Fined in the Commonwealth of Virginia for His Payday Lending Practices

  • Rawle Paid A $2,000 Fine For Acquiring More Than 25 Percent Of A Payday Lending Store In Virginia Without Obtaining Prior Approval From The Commission of Financial Institutions. [Payday Press, Commissioner of Financial Institutions, Jan. 2008]

Rawle Has Contributed $91,100 to Powerful Politicians and Special Interest PACs

Over the years, Rawle has contributed at least $91,100 to the campaigns of powerful politicians and special interest PACs. [Center for Responsible Lending]

  • 10/17/1999 – $500 – Financial Service Centers of America, Inc. PAC (FISCA PAC)
  • 12/13/1999 – $2,000 – Texas Freedom Fund (Rep. Barton Leadership PAC)
  • 03/20/2000 – $1,000 – Johnson, Tim
  • 12/04/2001 – $500 – Wilkinson, Winston
  • 02/15/2002 – $2,000 – Americans for a Republican Majority (Rep. DeLay Leadership PAC)
  • 03/31/2002 – $1,000 – Bachus, Spencer
  • 10/15/2002 – $1,000 – Swallow, John
  • 03/27/2003 – $1,000 – LaTourette, Steve
  • 10/28/2003 – $2,000 – Bush, George W.
  • 12/27/2003 – $4,000 – Swallow, John
  • 12/27/2003 – ($2,000) – Swallow, John
  • 03/31/2004 – ($2,000) – Swallow, John
  • 03/31/2004 – $2,000 – Swallow, John
  • 03/31/2004 – $2,000 – Swallow, John
  • 06/14/2004 – $2,000 – Matheson, Jim
  • 07/29/2004 – $2,000 – Swallow, John
  • 09/30/2004 – $2,000 – Hooley, Darlene
  • 03/16/2005 – $1,000 – Kanjorski, Paul
  • 05/13/2006 – $2,100 – Matheson, Jim
  • 05/13/2006 – $2,100 – Matheson, Jim
  • 09/13/2007 – $1,000 – Community Financial Services Association Of America PAC
  • 03/25/2009 – $5,000 – Community Financial Services Association Of America PAC
  • 03/31/2009 – $2,300 – Reid, Harry
  • 04/13/2009 – $2,400 – Bennett, Robert
  • 09/29/2009 – $2,400 – Chaffetz, Jason
  • 03/06/2010 – $2,000 – Democrats Win Seats PAC (Rep. Wasserman Schultz Leadership PAC)
  • 05/25/2010 – $2,400 – Lee, Mike
  • 10/15/2010 – $2,400 – Frank, Barney
  • 11/05/2010 – $2,400 – Lee, Mike
  • 03/22/2011 – $2,500 – Chaffetz, Jason
  • 05/16/2011 – $2,500 – Romney, Mitt
  • 09/30/2011 – $2,500 – Matheson, Jim
  • 10/25/2011 – $6,000 – National Republican Congressional Committee
  • 12/17/2011 – $2,500 – Matheson, Jim
  • 09/25/2012 – $2,500 – Romney, Mitt
  • 09/25/2012 – $2,500 – Romney, Mitt
  • 09/25/2012 – $5,000 – Republican National Committee
  • 10/10/2012 – $2,500 – Love, Mia
  • 10/23/2012 – $1,000 – Rehberg, Denny
  • 07/29/2013 – $2,600 – McHenry, Patrick
  • 09/30/2013 – $1,000 – Love, Mia
  • 08/05/2014 – $1,000 – Stewart, Chris
  • 10/09/2014 – $1,000 – Neugebauer, Randy
  • 10/20/2014 – $1,000 – Meeks, Gregory
  • 03/02/2015 – $2,500 – Shelby, Richard
  • 08/11/2015 – $1,000 – Stewart, Chris
  • 08/19/2015 – $1,000 – Bishop, Rob
  • 08/28/2015 – $1,000 – Love, Mia
  • 09/18/2015 – $1,000 – Lee, Mike
  • TOTAL: $91,100

Special thanks to National People’s Action for allowing Allied Progress to use its extensive research on payday lending industry executives.

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