Looking for legal documents or records? We will explain in great detail all aspects of each process including the risks & fees not just how much money you can save. 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. New Jersey Attorney General settles lawsuit against merchant cash Some business owners said they are being swamped with new texts and emails offering funds. To protect your privacy and the privacy of other people, please do not include personal information. 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. On March 19, as COVID-19 spread across the U.S., triggering a national emergency, a merchant cash advance company sued Indelicato and his wife, Alice. Put our experiencedMerchant Cash Advance Settlement Attorneysto work for you. You never made me feel harried, pressured or overly anxious about paying off my bills. Floral Park, NY. Search the Legal Library instead. Call us for a free consultation at (866) 890-7337 or click here to send us a message Tips to Avoid Defaulting on a Merchant Cash Advance As you can see, defaulting on an MCA can have serious implications for your business and finances. Whether or not a broker was involved, we have helped countless business owners that were sued traditionally or have signed COJs. A former stockbroker, she won the Pulitzer Prize in 2002 for her "trenchant and incisive" reporting on Wall Street. 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. If a business bankruptcy is filed, it needs to be considered if your business can still function and operate on a daily basis. Another person was told if he didnt pony up, they would falsely accuse him of being a child molester. The FTC's lawsuit alleged that Yellowstone . Hire A Real Law Firm instead of a Debt Relief Company, Merchant Cash Advances and Filing Bankruptcy, The amount owed to MCA and other obligations, Past, Current, & Future Cash Flow of the business, chance, pretty much stressed out on my options, I stumbled on, but very satisfied with my collaboration with Dramer. As I mentioned before the only thing is Im interested to see when the payments Ive made start showing up on my credit report as its still very low. Dial 516-670-5165 right away. Learn more about consumer topics at consumer.ftc.gov, or report fraud, scams, and bad business practices atReportFraud.ftc.gov. He is very professional and extremely helpful. This means your customers will receive a letter telling them not to pay you but to pay your funder instead!!! Gretchen Morgenson is the senior financial reporter for the NBC News Investigative Unit. If you are a business owner and want to file for personal bankruptcy, your obligation to pay back the advance will be discharged; however, the liability for the business remains. A Merchant Cash Advance is not a set term as the purchaser is paid back as funds come into your merchant account. 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. Arverne, NY 2-6-17, Happy new year! Debt settlement companies typically do not discuss any downsides of settling your Merchant Cash Advance obligations. Michael, Im gonna miss you! Steven & Esther W. 12-12-14. Perhaps I will be like that one day (in another life). Peter L Valley Stream, NY 3-2-17, When I initially called, I spoke to Mike. Again, please accept our gratitude for all your help. Bob & I wish you a Happy, Healthy Holiday Season. 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. Merchant cash advances are a form of financing in which the defendants provide money to a small business up front in exchange for a larger amount repaid through daily automatic payments. Unless your case involves one of our attorneys having to go to court, our negotiation service fees are flat fee based not charged hourly. He stopped paying around Thanksgiving and hired a restructuring firm, Second Wind Consultants, to help him work out the loans. Not only is that extremely embarrassing, but without any money coming in, how will you continue to run your business? The company, PowerUp Lending Group of Great Neck, New York, had given North River money to be repaid from the stores' future sales. We think back at how hopeless we were feeling when we first contacted you and your firm, how reassuring it was to speak with you and how you empowered us to get this dark cloud behind us. Anne G. Brooklyn, NY 1-2-2017, I was very pleased with the legal services I received from the Dramer Law Firm regarding settling a debt collection matter with a very stubborn collection service J. V. Cobleskill, NY. 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. I thank the company and Michael for giving me peace of mind at this point. Sue R. Allegheny Co, PA 6-15-15, I would like to express my gratitude for your perseverance in assisting me through the toughest time of my life. I was initially hesitant to enter into any debt settlement program but now, without hesitation, I will say it was the best decision I could have made . At The Dramer Law Firm, our fees are about 1/3 of what most debt settlement companies charge and we only charge a very minimal amount upfront (most of our fees come when we succeed)! Clients Cry Foul Over Litigious Litigation Finance Company (4) Among many other factors to be discussed range anywhere from: When you call our firm,we will want to know how and when your financial hardship began as well as what the current status is, to get a better understanding of what you are experiencing. 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. Did you Personally Guarantee your advance or sign a Confession of Judgment? Merchant Cash Advance Lawsuits - Global Legal Law Firm On March 27, NBC News contacted Bernard Feldman, a lawyer for PowerUp Lending, about the Indelicato case. If you took out a Merchant Cash Advance of any other business loan or line of credit, then you have signed away UCC Lien rights to your funder. Once hired the process was thoroughly explained to me and it was about as effortless (at least on my end) as humanly possible. Worked with Michael who was so patient and was very understanding. (NBC News received no evidence that PowerUp, Itria or Biz2Credit had sent menacing messages to borrowers or had sent debt collectors to their homes, or had engaged in any other improper collection practice. I wasnt even their client at this point and they were already going above and beyond. "I don't see how companies that are collecting future receipts can be litigating against companies that don't have any receipts," Indelicato said. Franchisee Conversations with Chair Khan, Statement of Commissioner Rohit Chopra Regarding Yellowstone Capital, LLC, Blog: Small business targeted with unauthorized withdrawals, Blog: Protecting small businesses seeking financing during the pandemic. The MCA companies will almost always move to sue the business immediately. During the three-week period, Itria filed suit against 20 small businesses for nonpayment, court records show, most of them outside the state. 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. All settlements are represented as a percentage of the debt paid back. We know what to say but more importantly, what NOT to say and we have the experience and know-how to get the job done. Without truly understanding the risks, how can you make an educated decision as to whether or not debt settlement is going to be right for your business? This benefits you when we contact these companies on your behalf, they know the accounts will get resolved and therefore we are usually able to avoid legal action! This saves time for you and eliminates any extra stress for you as time is money and being stress free is just as important as being debt free! All this just to get you to sign on the dotted line. A True Merchant Cash Advance is NOT a loan. He didn't talk too much about how it was secured or the workings of it.". The merchant cash advance companies often demand that borrowers also pay attorneys' fees, which can be 25 percent to 33 percent of the balance due under a borrower's agreement, documents show. If you have multiple lenders, the first to obtain a judgment puts themselves in a priority position to try and garnish bank accounts or levy against your assets. In addition to the $2.7 million financial judgment with RCG and Giardina, the just-announced orderputs them on the Banned Wagon, prohibiting them from engaging in small business financing and debt collection. Sometimes called cash advances, payday loans are quick, simple, convenient loans with competitive rates and terms. Need an experienced Merchant Cash Advance attorney? They do not belong to or represent views of the Federal Trade Commission. 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. Ive said it once, and Ill say it again you are greatly appreciated! ), "If you don't send money to me today you're done," said a recent text shared by a business owner. Settlement companies will harp mainly on the amount of money you should expect to save and that they will cut your payments in half. It is your debt and your money, soyou have the final say in all of our negotiations. Bankruptcy was the best choice we made and the cheapest way out. The laws regarding the filing of Confession of Judgments (COJ) in New York have recently changed. But keep in mind, this is a moderated blog. What Happens with a Merchant Cash Advance Breach of Contract Lawsuit If I had any questions or concerns they would answer any questions very quickly and patiently. The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely. 1-21-16. UCC stands for Uniform Commercial Code and these types of liens can be more detrimental to your business than Judgments and COJs. 'I'm Ruined': Litigation Trend Takes Aim at Merchant Cash Advance A small-fleet owner received this text from a merchant cash advance provider. Im so relieved. We can convert the factoring method of your calculated payments, convert payments from daily or weekly withdrawals to monthly, etc. So when small businesses become targets for misleading claims, deceptive tactics, and flat-out intimidation, the FTC takes notice. CALL NOW FOR A FREE CONSULTATION and one of our advisors will be there to get you started on your path to financial freedom. Most Sincerely, Ken and Nicki K Highland, NY. There is no fee charged to you if we do not win your case, and if we do win, you can win up to $1,000 per violation, and the collector in violation will pay our attorney fees for you. Those allegations are troubling enough, but RCG was just getting warmed up. Have you spotted questionable financing offers that target small businesses? 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. He was kind, calming and very thorough. In 2019, it provided an estimated $19 billion in funding. Follow the FTC on social media, read consumer alerts and the business blog, and sign up to get the latest FTC news and alerts. Lawsuits are especially great if you used a broker to obtain funding. From communications via phone calls, faxed messages, and e-mails I was able to receive and transmit all the paperwork relevant to my case. FTC Alleges Merchant Cash Advance Provider Overcharged Small Businesses Merchant cash advances have grown in popularity in recent years, particularly for businesses that cannot get small-business loans from traditional banks. Handled my debt in a month and cut it in half. Business owners like yourself caught in high-cost Merchant Cash Advance traps. All of our attorneys, paralegals, and negotiators are dedicated to providing the best possible experience, while achieving results. Search the Legal Library instead. Proactively addresses potential barriers and issues to prepare clients of required actions and response sets. As couple we are able keep certain amount of assets. Thank you for helping me. "You can't have people freezing assets and demanding payments at a time like this. "The FTC has to seriously look at rules that ban some of the most extortionate clauses in these loan contracts," he said, adding that the FTC is prepared to "go after some of the loan sharks and their lawyers who run lawsuit mills that are filing some of these sham collection actions.". Thanks! JC, Queens, NY. Court filings in New York state show at least 313 legal actions brought by 98 companies from March 9 to March 20. Our mortgage negotiation services are offered a fee structure as such that you pay part of the fee when retaining our firm and part of the fee only if were successful. Its okayweve got this! Do you want to reduce your payments with our cash advance repayment options? The court proceedings were annulled, and agreeable working terms were consolidated with my creditors. A recent case decision on March 16, 2017 in the Supreme Court of New York in Nassau County, titled IBIS Capital Group, LLC v. Four Paws Orlando LLC, states, in summary, the fact that payment or enforcement of a Merchant Cash Advance agreement rests upon a contingency for the payment schedule (of the funds coming into the account), rather than a true loan, in which it is essential to provide for repayment absolutely and at all events, it is not actually a loan, and therefore, is valid, even though it provides for a return in excess of the legal rate of interest. The complaint also cites examples of businesses being left with bank overdraft fees as a result of the unauthorized withdrawals. 7 Ways to Get Out of a Merchant Cash Advance - Hasanov Capital 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. Rohit Arora, Biz2Credit's co-founder and chief executive, said in a telephone interview: "In some cases, we have to file these cases, but we also try to work with our customers. We do not want you to be harassed well take over the calls for you. They were able to reduce the money I owed to less than the original amount. Learn more about your rights as a consumer and how to spot and avoid scams. What to Do When You Can't Pay a Merchant Cash Advance from Blursoft Are you getting hounded by collection calls that you want us to take over on your behalf? This step is critical in any of our processes as we ensure that whatever service we recommend will be within your budget and therefore youre more likely to succeed. Is A Merchant Cash Advance Right For Your Business? - Forbes Beat Everest Business Funding in Court | SoloSuit Blog In the case of some Merchant Cash Advances, the profit made by the MCA purchaser can range from 100% to 200% or even higher, which would undoubtedly be usurious by most states standards if it were deemed to be a loan. Installment Loans, Payday Loans & Cash Advances | Check `n Go Thats the gist of the agencys 2020 lawsuit against merchant cash advance outfit RCG Advances, LLC and owner Robert Giardina. Recommended! Alex M. Floral Park, NY 12-24-14, I would like to open by saying how grateful I am to Michael Sininsky for helping me with my legal problem. 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. I can not thank you enough for giving me freedom from debt. Owners must also give the lenders unfettered access to their bank accounts for the automatic withdrawals. We expect commenters to treat each other and the blog writers with respect. Michael Atleson, Attorney, FTC Division of Advertising Practices, Competition and Consumer Protection Guidance Documents. 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. Based on your current income and your financial hardship, we will determine which course of action will work best for you. "We have no intention of pursuing this matter at the present time," Feldman wrote. "The coronavirus crisis is putting millions of small businesses in a precarious situation, and I'm really worried that loan sharks are exploiting the situation," said Rohit Chopra, one of the five commissioners who run the Federal Trade Commission. 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. It shows the kind of threatening language described in lawsuits by the FTC and the state of New York. We can negotiate a break from payments for a period helping you to strengthen your cash flow and give you some breathing room. I/we started out with $87,555.84 total debt and ended up paying back $26,020.71. A non-recourse clause, means the MCA have no recourse or no way to collect if the merchant account does not receive funds. 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. We have worked hard over the years to earn the reputation we have by giving honest advice to those in need rather than the advice that benefits our bottom line! 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! "We're already seeing a decadelong decline in small businesses. On March 23, Kayla Kight, a server at a Lone Spur in Prescott, Arizona, told NBC News that hers was the only restaurant in the group open for business and that it was just providing takeout. They advised me every step of the way through the difficult process of bankruptcy. But the 81-year-old lawyer says that's not how it worked when his solo practice accepted $55,000 from Scottsdale, Ariz.-based . ! Susan F. Copaigue, NY. In a return email, he said the firm had decided to stand down for the moment. Each option will have its own savings potential. Keep in mind the greater the downsides a choice may have the greater the potential for savings. The FTC says the defendants also forced people to sign confessions of judgment, which allowed the defendants to go straight to court for an uncontested judgment in case of an alleged default, leading to the unlawful seizure of business and personal assets. Merchants are typically required to repay the advances via automatic withdrawals from their bank accounts every day or week. With just one meeting with you, you gave me hope that just maybe I too could live debt free and once again become a responsible spender. They were patient and very helpful with my case. Not only did you get me out of debt but you gave me a freedom that cant be described. According to the complaint, the defendants told business owners that no personal guaranty of collateral was required and then put personal collateral requirements in their contracts. Florida Court Affirms That Merchant Cash Advance Product Not Subject to Of course I want to thank you further than what I wrote. To read about this case click here. FONDLY BARBARA & BOB G Brooklyn, NY 11-16-2015, I was deeply in debt and after I tried everything I could think of -including a reverse mortgage-I heard of this law firm and I was told to contact Michael Sininsky. "Their strategy was always to get more," he said. Debt Settlement can be a great option for some business owners, but for others it can be horrible! But the industry's reach has exploded as money from traditional banks has become less available to these borrowers. 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. If they do provide legal advice, they are doing so illegally, and it may not be accurate! Whether or not the bankruptcy is filed personally or for your business will determine the result of how the discharge will affect your liability. 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. The merchant cash advance companies often demand that borrowers also pay attorneys' fees, which can be 25 percent to 33 percent of the balance due under a borrower's agreement, documents. ! Merchant Cash Advance companies are aggressive and do not wait to take action when a business defaults on their product. I have been extremely pleased with the efficient, attentive, reliable service provided by Michael Sininsky. Nothing will be hidden from you as we are a full disclosure law firm. We typically work repeatedly with the same companies and are known for resolving accounts so therefore have a great reputation with industry lenders and collectors. Meanwhile, as the crisis spreads, cash advance companies are on the hunt for new customers. Any representative that will speak with you will have a minimum of 10 years experience. Merchant cash advances are a form of financing in which a company provides money to a small business up front in exchange for a larger amount repaid through daily automatic payments. We research all over the internet and called many law firms and layers. Their price is very reasonable. Hes truly an asset to your business. 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! All of our client relationships are One on One. Readily responds to questions and concerns in detail. "Working with a broker, I thought he was going to get me a traditional loan that was how the conversation started," Runion said. 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. "We went from having good credit and eight or nine stores to having bad credit and three stores," Indelicato said in an interview. CALL TODAY for your FREE CONSULTATION and let us help you save your business today! "I will put you in the hospital and your family, call the police I don't care, you and your family will pay." Its basically free money! The Federal Trade Commission Act authorizes this information collection for purposes of managing online comments. Itria Ventures of New York City, an affiliate of Biz2Credit, is among the merchant cash advance companies that filed numerous lawsuits in March. 7-7-2017, The Law Offices of Kenneth H. Dramer P.C Attorneys at Law were efficient in handling by bankruptcy case. The case against Jonathan Braun is pending. Have you spotted questionable financing offers that target small businesses? Once retained, we waste no time in taking action. This means your customers will receive a letter telling them not to pay you but to pay your funder instead!!! As a provider, you deserve to get paid for the cash you advance. 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. Get to keep our house and car, even our credit score went up. Penn Capital Funding, MapCap Funding Hit with Class - Class Action Our Law Firm is Known for Helping Business Owners With This Niche Area of Law (see below). We were also worried about our credit score, the bankruptcy record will stay in your record for 7 years ( our score were poor anyway). View Results from Our Merchant Cash Advance Relief Services. "You will end up hurt. "I tried to make it work," he said, "but I really was unable to.". It's an alternative form of financing unfamiliar to many small business owners. We dont benefit from getting you to hire our law firm, but instead, we benefit when we get the job done for you. I am eternally grateful to you and the rest of Dramer Law. And for . We will be in touch with you throughout the process to keep you informed and are available when you need us. 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 work quickly on your behalf as the longer you delay with a deed in lieu of foreclosure, the more fees your lender will charge. Prev Post Equally appreciative is the post-resolution services and relationship that Dramer, Retain Our Law Firm and Let the Savings Begin, Debt Collection Violation Lawsuit Results. Memo from Chair Lina M. Khan to commission staff and commissioners regarding the vision and priorities for the FTC. We wont post comments that include vulgar messages, personal attacks by name, or offensive terms that target specific people or groups. These companies arent proactive, they put no effort into negotiations, they dont even return your calls let alone calls from collectors! If you do, you must create a user name, or we will not post your comment. Failure to do so is a violation of the FDCPA, and we will sue them for you. Their profit or loss derives from future receivables whereas a loan company profits on the interest rate. I want to say, he immediately put my mind at ease. In addition to the initial advance, the MCA provider will also charge a fee for the transaction. 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. 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. This is called a merchant cash advance. Let our Merchant Cash Advance Debt Relief Attorneys to defend you or for our Certified Debt Arbitrators to negotiate on your behalf to save you as much time and money as possible the right way! 5-26-16, I am very grateful of Michael Sininskys assistance to get through the process. That must change, Chopra said. I feel as though a weight has been lifted that burdened me physically and mentally for a long time. When Debt is the Problem We Have the Answers! If revenue dries up and the money stops flowing, merchant cash advance companies can freeze business owners' accounts by filing so-called confessions of judgment. 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. 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. We can negotiate the principal balance owed to a lower payoff amount so you can literally pay back less than you owe. Highly recommended. G.P. They may also help you negotiate for debt relief or a settlement plan. 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. The FTC alleged that RCG, Giardina, and others stitched together a blanket of misrepresentations that cloaked the true nature of the transaction.
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