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Scott Tucker, right, underwrites his Level 5 Motorsports passion with profits from his payday lending businesses. Here, he is shown with drivers Luis Diaz, left, and Christophe Bouchut, center, celebrating with high-quality tequila at the American Le Mans Series’ Road Race Showcase in Elkhart Lake, Wis., on Aug. 20, 2011. Level 5 Motorsports/Flickr

A federal judge has ruled that payday lenders must obey consumer-protection laws even if they are affiliated with Indian tribes.

The March 7 ruling by U.S. District Judge Gloria Navarro of Nevada was a huge blow to a payday lending business run by Scott Tucker, who has used his earnings to finance a professional race-car team.

The Center for Public Integrity, in collaboration with CBS News, exposed Tucker’s involvement in a business called AMG Services in a series of stories in 2011.

The Federal Trade Commission is suing Tucker, alleging that he was making loans over the Internet using illegal and deceptive claims. Regulators in several states pursued Tucker for years but he was able to elude them after selling his business to the Miami and Modoc tribes of Oklahoma and the Santee Sioux tribe of Nebraska. Tucker continued to manage the business and kept at least 98 percent of the income, court documents show.

Several state courts ruled that they have no jurisdiction over tribal entities because they are sovereign nations. The FTC is claiming that AMG Services violated federal laws that apply to tribes. Last year, U.S. Magistrate Cam Ferenbach concluded that tribal entities are not exempt from federal consumer laws. In her ruling, Navarro accepted that decision.

“It’s a strong signal to deceptive payday lenders that their days of hiding behind a tribal affiliation are over,” Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said in a press release.

In January, Ferenbach concluded that AMG Services violated federal laws by using deceptive practices. In the coming months, Navarro will consider whether to accept Ferenbach’s decision again.

The FTC is seeking to have the payday lending business, Tucker and other defendants return all the money they made using allegedly deceptive means. FTC attorney Nikhil Singhvi said the amount will “easily be in the millions of dollars.”

Two days after Navarro issued her ruling, Tucker’s brother Blaine was found dead in the parking lot of a shopping center in Leawood, Kan., a suburb of Kansas City. Police say he committed suicide but provided no other details. Blaine Tucker was a defendant in the FTC lawsuit.

A lawyer for Tucker did not respond to an email seeking comment Wednesday.

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