Small businesses sued by Itria included a builder's company in Minnesota, a grocery in South Carolina, a Holiday Inn Express in Wyoming and a barbecue joint in Alabama, court filings show. There is no obligation to enroll, so dont delay. 2-2-2016, I highly recommend the services of The Law Offices of Kenneth H. Dramer and Michael Sininsky. Debt relief is an important decision, and we wont rush you! Lone Spur Caf, a six-restaurant chain in Arizona and Colorado, was also sued by Itria on March 19, with a demand for $282,000. April 2019: How Mulvaney undid consumer protections from predatory lenders. Beyond withdrawing unauthorized payments and failing to provide businesses the promised amounts, the complaint also alleges that the defendants relied on deceptive marketing to promote their services. Federal government websites often end in .gov or .mil. The FTC had previously settled with defendants RAM Capital Funding, LLC and Tzvi Reich. Most banks offer more conventional small business loans with favorable terms, but longer turnaround times. Please call for your free consultation to speak to one of our trained professionals. Spot the latest COVID scams, get compliance guidance, and stay up to date on FTC actions during the pandemic. Merchant Cash Advances can be discharged through bankruptcy. All this just to get you to sign on the dotted line. Settlement companies will harp mainly on the amount of money you should expect to save and that they will cut your payments in half. But the industry's reach has exploded as money from traditional banks has become less available to these borrowers. CALL TODAYfor yourFREE CONSULTATIONand let us help you save your business today! Three merchant cash advance companies are facing a lawsuit from New York Attorney General Letitia James over reportedly practicing illicit measures when loaning money to clients, according. This COJ caused further recourse and hence, was deemed to be a loan rather than an actual advance, thus voiding the contract. "Currently in route to u right now," the text said. Like most people bankruptcy never crossed our mind. We may routinely use these records as described in the FTCsPrivacy Act system notices. Mike handled my case, hes very professional and efficient, he made sure I understand the whole process, any questions I have are answered promptly. Merchant Cash Advance Lawsuit - Business Debt Law Group There have been an increased number of lawsuits filed in New York since the COJ ban has gone into place which is a great thing, as lawsuits can be defended, and doing so will buy you much needed time to either work out a payment arrangement or a discounted settlement payoff. We can defend you in court if you were sued to buy time and even to successfully defend a judgment from being entered if prove your MCA to be a loan rather than an actual advance. Shortly after NBC News spoke with Arora, Itria withdrew its court actions against Lone Spur and other small businesses, court records show. In some cases, Yellowstone would only refund this money when businesses complained, and even then the refunds could take weeks or months, leaving small businesses without needed cash on hand. Lendmark Financial Services: Convenient Personal Loan Solutions Merchant Cash Advances can be discharged through bankruptcy. They will tell you that you only have to make one payment into an escrow account and theyll settle your balances for less making MCA debt settlement seem like a walk in the park. Be well. Mary R. Bayshore, NY 4-30-2018, I would highly recommend Dramer Law for your debt settlement needs. Signed a Confession of Judgment (COJ) or Being Sued For Your Personal Guarantee? Aside from treating you with the upmost care possible, this means you wont have to deal with multiple people and re-explain your situation to a different person each time you call. Franchisee Conversations with Chair Khan, A just-announced settlement will return more than $2.7 million to consumers, previously settled with defendants RAM Capital Funding, LLC and Tzvi Reich, Franchises, Business Opportunities, and Investments, The Luring Test: AI and the engineering of consumer trust, Franchise Fundamentals: Debunking five myths about buying a franchise, A required action after refraction: FTC staff sends cease and desist letters about Eyeglass Rule compliance, The 411 about FTC-Florida AG action against Chargebacks911. We serve clients in English & Spanish. 4-6-15, Recently we finished the debt relief program through Dramer Law. New York Merchant Cash Advance Attorney | Jacovetti Law, P.C. Many of them ask what we want to do?.. Have you spotted questionable financing offers that target small businesses? Memo from Chair Lina M. Khan to commission staff and commissioners regarding the vision and priorities for the FTC. I would highly recommend this firm to anyone going through financial difficulty and need good advise. We can offer advice and help you to protect your assets from your creditors, thereby alleviating the worrying and stressing over frozen accounts or assets. Many of your customers that receive notice of the UCC Lien filed against you may see that as a sign of weakness and may also choose to do business elsewhere so it can cause problems in more ways than one. ", Full coverage of the coronavirus outbreak. Put our experienced Merchant Cash Advance Settlement Attorneys to work for you. Gretchen Morgenson is the senior financial reporter for the NBC News Investigative Unit. A True Merchant Cash Advance is NOT a loan. Jason Indelicato, who owns a three-store clothing chain in Massachusetts called North River Outfitter, is under siege. ), "If you don't send money to me today you're done," said a recent text shared by a business owner. Youll have one individual client service representative that will be your point of contact and youll build a relationship with them so theyll know exactly what you are going through. Its an alternative form of financing unfamiliar to many small business owners. It's an alternative form of financing unfamiliar to many small business owners. I was beside myself when I spend a hit letter from an attorney who.informed me that I was in debt for a very large amount of money that was owed 15 years ago I thought the matter had been resolved through my divorce, but to.my dismay it wasnt and had accrued an astronomical amount of late payments and finance charges, they froze our bank accounts , but through the expertise of Mr.Sininsky he resolved a 15 year matter in 2 weeks unfroze our accounts and saved us more than we could of imagined I recommend the Dramer Law firm highly and lifted a great deal of stress for us. Whether or not a broker was involved, we have helped countless business owners that were sued traditionally or have signed COJs. According to the FTCs complaint, Yellowstone has regularly withdrawn hundreds or thousands of dollars from businesses accounts for days after customers had repaid the full amounts owed in their contracts. New Jersey Attorney General settles lawsuit against merchant cash advance providers. Legal filings by cash advance companies, including confessions of judgment filed against small businesses, have been ballooning amid the coronavirus crisis. Whether or not the bankruptcy is filed personally or for your business will determine the result of how the discharge will affect your liability. Pravati Capital embroiled in multiple disputes with clients. Well send out a limited power of attorney notice to anyone trying to collect money from you to make sure that they contact our Law Firm instead of contacting your company. Of course I want to thank you further than what I wrote. If you do, you must create a user name, or we will not post your comment. Merchant cash advance companies like PowerUp aggressively cold-call, email and text small business owners offering quick and easy funding, merchants told NBC News. In addition to the initial advance, the MCA provider will also charge a fee for the transaction. Suit Filed Against Merchant Cash Advance Companies - PYMNTS.com The Law Offices of Kenneth H. Dramer are extremely knowledgeable and dedicated. Prev Post They were patient and very helpful with my case. Dont use trial and error trying to figure this out on your own with thousands of your dollars at stake when errors can be costly! 7-7-2017, The Law Offices of Kenneth H. Dramer P.C Attorneys at Law were efficient in handling by bankruptcy case. He provided a photo to NBC News. At a time when many small businesses are struggling to stay afloat, the FTC is paying close attention to the tactics of companies claiming to throw them a financial lifeline. If youve answered YES to any of these questions, then our Merchant Cash Advance Relief Attorneys can help! No matter where you are in the country you can contact our firm in Long Beach, NY to set up a free business debt relief consultation. Thank you again & i hope you dont mind if i touch base with you the future, just to give you updates on how things are going. Lawsuits are especially great if you used a broker to obtain funding. The offers are alluring to owners who often operate on the edge and are strapped for cash. The underlying lawsuit involved several commonly litigated issues in the MCA space, and the court unambiguously came down on the side of the MCA company. I kept hoarding mail and it overwhelmed me. Not only did you help me do this, but I have learned some other valuable lessons that are priceless like dont spend beyond your means and if you dont have cash for it dont buy it. We dont benefit from getting you to hire our law firm, but instead, we benefit when we get the job done for you. Opinions in comments that appear in this blog belong to the individuals who expressed them. Most of the merchant cash advance lawsuits occur in New York even though businesses across the United States obtained funding from these companies. So when small businesses become targets for misleading claims, deceptive tactics, and flat-out intimidation, the FTC takes notice. A similar situation regarding further recourse to the Merchant Cash Advance purchaser came about in the case Merchant Funding Services, LLC, v. Volunteer Pharmacy Inc. which dealt with the signing of a Confession of Judgment (COJ) in the MCA contract. A proposed class action lawsuit has been filed against Penn Capital Funding, MapCap Funding and those who run the merchant cash advance (MCA) companies over their alleged use of an apparent loophole in Connecticut law to collect upon unlawful debts and otherwise fraudulently obtain money. Lina M. Khan was sworn in as Chair of the Federal Trade Commission on June 15, 2021. We'll get into all of the specifics in the article below, but in most cases, when a business defaults on an MCA, the contract states that the MCA lender can immediately begin to: File a collection lawsuit. The laws regarding the filing of Confession of Judgments (COJ) in New York have recently changed. As couple we are able keep certain amount of assets. In addition to potentially saving you money, retaining Dramer Law will save you time as we, Our Lawyers Can Help Whether or Not You Signed a Confession of Judgment. We will explain in great detail all aspects of each process including the risks & fees not just how much money you can save. Business owners like yourself caught in high-cost Merchant Cash Advance traps. Thank you for helping me. When disputes arise about these cash advances, a lawsuit may occur. Not only did you waste money in fees to the settlement company, but your funders have now all assessed extra fees per their contract which typically include: DONT FALL THE FOR DEBT SETTLEMENT LIES. During the three-week period, Itria filed suit against 20 small businesses for nonpayment, court records show, most of them outside the state. There arent that many reviews on the internet about them and like most people were not sure if we can trust them. A similar case Platinum Rapid Funding Group Ltd. v VIP Limousine Services., Inc. can be found here. Looking for legal documents or records? The flood receded when New York courts stopped accepting electronic filings in nonessential matters on March 23. The most common arrangements between these companies and small business borrowers aren't technically loans, and therefore their terms and the companies offering them aren't regulated. The site is secure. Since our clients dont have tons of money to spare like attorneys that practice in other areas of law, we charge low fees making our services affordable for anyone that needs help. I want to say, he immediately put my mind at ease. The repayment was not contingent upon funds coming into the merchant account, causing it to be a loan and therefore the rate charged, which was calculated to be roughly 180%, was in fact deemed usurious and thus the contract was voided. Three federal rulings scrutinize the business model on which merchant cash. The .gov means its official. I had a million questions and was pretty lost about what steps I should take next and Mr. Sininsky, quite patiently explained everything to me. We work to advance government policies that protect consumers and promote competition. trade references (of which some are your customers); bank statements (they will looks through your statements to see who pays you); or. A non-recourse clause, means the MCA have no recourse or no way to collect if the merchant account does not receive funds. It shows the kind of threatening language described in lawsuits by the FTC and the state of New York. Specifically, the complaint states that Yellowstone promised that business owners would not be required to provide collateral or be subject to a personal guaranty. Keep in mind the greater the downsides a choice may have the greater the potential for savings. Need an experienced Merchant Cash Advance attorney? Merchant cash advance companies provide funds to businesses in exchange for a percentage of their revenues, often in the form of daily withdrawals from the business's bank account until the obligation has been met. Any fees paid to Dramer Law were very fair and minimal compared to what I was paying to the credit card companies each month. Installment Loans, Payday Loans & Cash Advances | Check `n Go . An official website of the United States government. Not only did you get me out of debt but you gave me a freedom that cant be described. A screenshot of a text sent to a small business owner. UCC liens are by far the most frequent issue we hear about from those first contacting our Law Firm for help after having defaulted on their payment obligations. From communications via phone calls, faxed messages, and e-mails I was able to receive and transmit all the paperwork relevant to my case. Attorney General James Sues Predatory Lender That Threatened Violence When the business owners call to find out what is going on, they quickly find out that no progress has been made! 'I'm Ruined': Litigation Trend Takes Aim at Merchant Cash Advance What Happens if You Default on a Merchant Cash Advance? - Lane Law Many times, when we successfully get our clients out of debt, they still need assistance with other areas of their financial life. Let's break down what this MCA looks like if the provider deducted 10% of your monthly credit card sales until you repaid the full $70,000 based on different revenue amounts: MCA details. They will go over each option that will make sense for your situation and will be sure to discuss in detail the pros and cons of each. "I will put you in the hospital and your family, call the police I don't care, you and your family will pay." Florida Court Affirms That Merchant Cash Advance Product Not Subject to Aggressive Business Lawyers at Affordable Rates From the initial consultation and throughout the entire process ,Michael patiently and fully explained everything. The Commission vote authorizing the staff to file the complaint was 4-0-1, with Commissioner Rebecca Kelly Slaughter recorded as not participating. Based on your current income and your financial hardship, we will determine which course of action will work best for you. We research all over the internet and called many law firms and layers. Lines Of Credit, Business Loans, & Merchant Cash Advances . Get to keep our house and car, even our credit score went up. In this case, the FTC alleged that Yellowstone and its owners continued withdrawing money from businesses' bank accounts for days after their balance had been repaid. In this merchant cash advance FAQ, you'll learn about how they work, the repayment terms you'll want to watch out for and how to protect yourself and your business from predatory practices. As you know being in debt that you cant see your way out of causes so many restless nights and a lot of stress and anxiety. receive our Limited Power of Attorney, they are obligated to contact us directly on your behalf. Runion said the companies that advanced him cash have persuaded an insurer holding $40,000 in reimbursements for procedures he had already completed to send the money to the advance company, not to Runion. Have you tried to refinance an MCA and were denied? Use our visualizations to explore scam and fraud trends in your state based on reports from consumers like you. Need an experienced Merchant Cash Advance attorney? Typically they provide these loans, including merchant cash advances programs, to small businesses in need of working capital. They advised me every step of the way through the difficult process of bankruptcy. The Merchant Capital decision is very good news for MCA companies doing business with Florida merchants. "I'll show you what type of loser you are you clown of a man.". Our lawyers and certified debt arbitrators will discuss the Pros AND Cons of each different option, as debt settlement isnt the only option out there to choose from. They have access to your bank accounts they can wipe out an account overnight.". Now those sales are nonexistent but PowerUp's suit demanded immediate payment of almost $91,000, plus legal fees. Our mission is protecting consumers and competition by preventing anticompetitive, deceptive, and unfair business practices through law enforcement, advocacy, and education without unduly burdening legitimate business activity. Search the Legal Library instead. IE 11 is not supported. Federal government websites often end in .gov or .mil. It is at this time they will realize the debt settlement company is not looking out for your best interest, but instead, their own best interest which is to collect their absorbent fees. The problem is, you will NOT receive a refund of any fees paid to the debt settlement company and your business is now far worse off than it was! At the time of underwriting or any time since then, if you have provided your funder with: then you can assume that within a day or two of filing a UCC lien against you, your funders will send a copy of the UCC lien to anyone they know of that pays you! Merchant Cash Advance Attorney Florida - Grant Phillips Law On March 27, NBC News contacted Bernard Feldman, a lawyer for PowerUp Lending, about the Indelicato case. Our debt relief representatives will be sure you understand the cost benefits and will be sure to disclose our fees fully. Arverne, NY 2-6-17, Happy new year! Small businesses are the backbone of the U.S. economy, employing millions of people and paying taxes. If funds do not come into your merchant account, the MCA company should not collect. These actions cause collectors to seek other measures to collect, often meaning lawsuits. Readily responds to questions and concerns in detail. We would highly recommend their services for debt reduction and settlement rate negotiations. John & Pat T. Valatie, NY 5-30-2017, Thanks for being so helpful i am glad for your help I hope I can send some client your way thanks so much Audrey. "He more or less presented me the net cash I would receive and the payments. Nothing will be hidden from you as we are a full disclosure law firm. What a wonderful feeling to be out of debt at last! It became a cycle of death. We do not only offer one path, as no one process can solve everyones needs. If instead of hiring an experienced Business Debt Relief Law Firm you opt to hire a regular debt settlement company to deal with your Merchant Cash Advance, they will NOT be able to give you legal advice. This year, my wife and I will be celebrating 25 years of marriage and I cant think of a better 25th wedding anniversary gift than this! Court filings in New York state show at least 313 legal actions brought by 98 companies from March 9 to March 20. Our managing the collection efforts on your behalf helps to ensure the finances of your business stay private, away from the ears of your employees who typically will worry about their job security and may start to search for different employment if they believe you are struggling. Our business debt attorneys and arbitrators have successfully worked with many struggling business owners who werent able to qualify for traditional bank funding who were then forced to pledge future receivables to one or more Merchant Cash Advance companies for the capital they needed. Bankruptcy was the best choice we made and the cheapest way out. We have heard many horror stories. Merchant Cash Advance Relief Attorneys | The Law Offices of Kenneth H North River Outfitter in Beacon Hill, Mass., is owned by Jason and Alice Indelicato. It is important to take note that the COJ laws have not changed in any other states only in NY so COJs can still be filed against you outside of New York. The biggest . Mr. Sininsky was personable, honest, deligent, and stayed in communication with me every single step of the way. Some companies' aggressive, even menacing, collection techniques are documented in video, recordings and emails provided to NBC News. Based in Doral, Florida, Everest Business Funding is an online provider of loans and merchant cash advances. Getting out of that debt was like taking a huge weight off my shoulders. Cory K. 4-20-15, Nicki and I are ecstatic, she is so happy she is in tears! Learn more about your rights as a consumer and how to spot and avoid scams. For example, a 40% settlement means that 40% of the debt is paid back and 60% is forgiven. You pay for our performance and thats what we do we perform! MCAs are not considered loans , so they aren't subject to most of the laws that apply to traditional business loans. They do not belong to or represent views of the Federal Trade Commission. Penn Capital Funding, MapCap Funding Hit with Class - Class Action If you are an out of state business owner, a confession of judgment can no longer be filed against you in the state of NY. Your promptness, efficiency, and trustworthiness have always been beyond my imagination. He kept me up-to-date about the process of this whole mess I got myself into and he was truly a comfort to me these past few months. It is true that a judgment (whether entered by COJ, default, or awarded) can also be used to freeze your incoming receivables, however, most funders do not use judgments to freeze receivables (especially now that COJs in NY are banned against out of state business owners) so filing a UCC lien is a much quicker tool! Office of The Attorney General With an added personal guarantee, it gave recourse to the MCA lender to collect, even if the merchant account was not performing, thus additionally reducing the MCA purchasers risk of not being repaid. But, in the lawsuit, Attorney General James alleges that the Richmond companies' merchant cash advances are in fact illegal, high-interest loans with astronomical and illegal rates. The company, PowerUp Lending Group of Great Neck, New York, had given North River money to be repaid from the stores' future sales. The case will be decided by the court. ! Susan F. Copaigue, NY. Many companies do nothing for the high fees they charge. Theyre highly recommended. Rodolfo P. Queens, NY 6-27-2018, Michael Sininsky is professional and responsive in every aspect of all services provided. Most Sincerely, Ken and Nicki K Highland, NY. Is a Merchant Cash Advance Right for Your Business? Instead of lending an amount of money over a period, a Merchant Cash Advance company will purchase your companys future receivables coming into your merchant account. l want to know more about ,l have get the notes banking .to set me an order . To file a detailed report about a scam, go to. Loans are considered absolute and must be paid back with set terms and conditions. Before sharing sensitive information, make sure youre on a federal government site. Our Law Firm is Known for Helping Business Owners With This Niche Area of Law (see below). ", When merchants fall behind on their payments, some direct lenders send threatening emails and texts, owners and their lawyers say. Worked with Michael who was so patient and was very understanding. Before sharing sensitive information, make sure youre on a federal government site. Comments and user names are part of the Federal Trade Commissions (FTC) public records system, and user names also are part of the FTCscomputer user recordssystem. Clients Cry Foul Over Litigious Litigation Finance Company (4) We do not want you to be harassed well take over the calls for you. Cash Advance Firm to Pay $9.8M to Settle FTC Complaint It Overcharged What to Do When You Can't Pay a Merchant Cash Advance from Blursoft The purpose of this blog and its comments section is to inform readers about Federal Trade Commission activity, and share information to help them avoid, report, and recover from fraud, scams, and bad business practices. "We have no intention of pursuing this matter at the present time," Feldman wrote. That must change, Chopra said. CALL NOW FOR A FREE CONSULTATION and one of our advisors will be there to get you started on your path to financial freedom. If the merchants fall behind on their payments, some lenders send threatening emails and texts and even pay visits to borrowers' homes to try to collect, lawyers and small business owners say. They were able to reduce the money I owed to less than the original amount. Thank you from the bottom of our hearts for all of your efforts in getting us through this! At The Law Offices of Kenneth H Dramer PC, before we make any recommendations, our debt lawyers, certified debt relief specialists, and paralegals are trained to ask the right questions to find out about your specific situation. The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely. Call or Text "CASH" to Tommy Funding Coordinator/Agent today at 716 906-7233 for quick funding! The changes to the NY law are a major win for business owners outside of NY, however, the law does not effect those living in NY as, COJs can still be filed against NY residents. Small businesses that need cash must increasingly rely on merchant cash advance lenders members of a little-known industry with almost no government oversight; effective interest rates that can hit 400 percent, according to congressional testimony; and direct access to their customers' bank accounts. Not only is that extremely embarrassing, but without any money coming in, how will you continue to run your business? He didn't talk too much about how it was secured or the workings of it.". It was that unfront honesty and eagerness that sealed the deal for me. A former stockbroker, she won the Pulitzer Prize in 2002 for her "trenchant and incisive" reporting on Wall Street. And for . This can be said for ANY service we offer from negotiations to litigation to bankruptcy. "I tried to make it work," he said, "but I really was unable to.". I highly recommend them. Jamie M. Seaford, NY 5-30-2017, I just wanted you to know it has been an absolute pleasure working with you.
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