Depend on fast response times. 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. Find the resources you need to understand how consumer protection law impacts your business. In fact, MCAs are largely unregulated. The FTC had previously settled with defendants RAM Capital Funding, LLC and Tzvi Reich. 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. I kept hoarding mail and it overwhelmed me. 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. Its an alternative form of financing unfamiliar to many small business owners. Approach a Merchant Cash Advance Attorney Hire a lawyer skilled in debt settlements and bankruptcy for your MCA debt. When disputes arise about these cash advances, a lawsuit may occur. "We're already seeing a decadelong decline in small businesses. Overall, though, Im very happy. Mike S. Baldwin, NY 8-3-15, I was so happy to have been represented by the law firm of Kenneth H. Dramer. 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. 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. 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. Call or Text "CASH" to Tommy Funding Coordinator/Agent today at 716 906-7233 for quick funding! I have been extremely pleased with the efficient, attentive, reliable service provided by Michael Sininsky. The case will be decided by the court. Many of them ask what we want to do?.. Sending notice of representation is the first step in curbing any creditor or collector calls you may be receiving. We have years of experience dealing with most Merchant Cash Advance Lenders. A lot of these companies had problems prior to coronavirus; they were on a payment plan and they defaulted.". Until we got hit with a summons from the court ( for over 100K lawsuit). 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. Commissioner Rohit Chopra issued a statement. Spot the latest COVID scams, get compliance guidance, and stay up to date on FTC actions during the pandemic. They advised me every step of the way through the difficult process of bankruptcy. Many business owners are struggling so badly that they will believe any promises of help for a way out and end up hiring a debt settlement companies. Like most people bankruptcy never crossed our mind. Loans are considered absolute and must be paid back with set terms and conditions. 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. The flood receded when New York courts stopped accepting electronic filings in nonessential matters on March 23. 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. What makes our merchant cash advance settlement services stand out from the rest? "Currently in route to u right now," the text said. "I will put you in the hospital and your family, call the police I don't care, you and your family will pay." A True Merchant Cash Advance is NOT a loan. Michael explained the process in detail and even though I was quite hesitate I feel this was the best option for me. sincerely Mr & Mrs. Vogel, NY 12-15-14. Another text to the owner included a Google map showing a driving route the debt collector was taking to the borrower's home. It is your choice whether to submit a comment. The dual dynamos that power our economy are Americas 32 million small businesses and the more than 60 million people they employ. 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 have heard many horror stories. 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. Based in Doral, Florida, Everest Business Funding is an online provider of loans and merchant cash advances. For example, if A+ Construction Co gets an advance of $10,000 and pays back 20% of their sales with a 1.35-factor rate, they will pay back about $13,500 by the end of the eight weeks. The FTC's lawsuit alleged that Yellowstone . We are so pleased with the results.I know we could not have been successful without their help. Mr. Sininsky was personable, honest, deligent, and stayed in communication with me every single step of the way. The dual dynamos that power our economy are Americas 32 million small businesses and the more than 60 million people they employ. In some states, you may be able to fight it if you can prove any of the following: as well as any of your customers that pay you! Their profit or loss derives from future receivables whereas a loan company profits on the interest rate. 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. In this case, the defendant disputed the plaintiffs MCA due to specific language that was missing in the contract a non-recourse clause. 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. Find legal resources and guidance to understand your business responsibilities and comply with the law. We do not want you to be harassed well take over the calls for you. The .gov means its official. Highly recommended. 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 site is secure. To protect your privacy and the privacy of other people, please do not include personal information. Learn more about your rights as a consumer and how to spot and avoid scams. Now those sales are nonexistent but PowerUp's suit demanded immediate payment of almost $91,000, plus legal fees. The combination of our experience, well-trained representatives, long hours, and state of the art software, allow us to accomplish more in any given day than most other firms only dream about. We offer many different services for those struggling with debts including Business Debt Relief, Mortgage Relief, Tax Relief, & Student Loan Relief. Lillian L. Queens, NY 7-20-2015, To Whom It May Concern , We would like to thank Michael Sininsky and your law firm for helping us get out of debt and back on track . That is our one and only goal when we go to work for you TO SAVE YOU AS MUCH MONEY AS POSSIBLE! I wish everyone would be like that. 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. Global Legal Law Firmrepresents companies in merchant cash advance lawsuits to collect on underperforming or unpaid debts. You can further research this case here. The filings are often in amounts that are twice the money owed, say lawyers who work in the arena. They have access to your bank accounts they can wipe out an account overnight.". Its basically free money! An official website of the United States government. Merchant cash advances have grown in popularity in recent years, particularly for businesses that cannot get small-business loans from traditional banks. Please call for your free consultation to speak to one of our trained professionals. 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. We never agree to anything without first consulting with you and getting your approval. The personal guaranty being a required condition of the MCA contract was one fact of this case which showed the need to repay the advance was undeniable. All of our client relationships are One on One. In summary, a Merchant Cash Advance company does not lend and charge interest but instead purchases your future receivables. Thank you again for all your help Greg T. Long Island, NY. He said the companies have almost killed his business. Nothing will be hidden from you as we are a full disclosure law firm. Owners must also give the lenders unfettered access to their bank accounts for the automatic withdrawals. 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. Michael, Im gonna miss you! Steven & Esther W. 12-12-14. A just-announced settlement will return more than $2.7 million to consumers and includes a key provision to protect small businesses in the future. "It's down a lot, more than 50 percent," she said. By Michael R. Guerrero & John Sadler on January 13, 2023. Advance . Your guidance, understanding and expertise were very comforting to us .Of course we are so happy that this situation is now settled. NBC News reviewed some of the communications, including videos of a visit by a collection agent to a borrower's home and another to a borrower's office by an expletive-spewing man trying to collect on a loan. In 2019, it provided an estimated $19 billion in funding. The MCA companies will almost always move to sue the business immediately. Memo from Chair Lina M. Khan to commission staff and commissioners regarding the vision and priorities for the FTC. We may routinely use these records as described in the FTCsPrivacy Act system notices. Did you Personally Guarantee your advance or sign a Confession of Judgment? According to the, In addition to the $2.7 million financial judgment with RCG and Giardina, the just-announced. When the business owners call to find out what is going on, they quickly find out that no progress has been made! "I don't see how companies that are collecting future receipts can be litigating against companies that don't have any receipts," Indelicato said. Floral Park, NY. We wont post threats, defamatory statements, or suggestions or encouragement of illegal activity. But the 81-year-old lawyer says that's not how it worked when his solo practice accepted $55,000 from Scottsdale, Ariz.-based . Heskin, who testified last year before Congress about the lenders' tactics, said one of his law partners found a disemboweled rat splayed atop his mailbox in front of his home. According to the FTC, when small business owners sought capital, RCG formerly known as Richmond Capital Group lured them in with fast talk and supposedly sweet terms for what are called merchant cash advances. "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. The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely. There is no obligation to retain our services. Do you want to reduce the amount of the principal balance that you owe with our merchant cash advance settlement negotiations? Use our visualizations to explore scam and fraud trends in your state based on reports from consumers like you. 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! Another small business borrower who's been through the wringer with merchant cash advance companies is Jon Runion of Runion Dental Group in Columbus, Ohio. And for . Each option will have its own savings potential. CALL TODAYfor yourFREE CONSULTATIONand let us help you save your business today! Sincerely, Susan M. Commack, NY 3-27-2018, Thank you very much. The key to understanding how to litigate these cases is knowing where an MCA differs from traditional loans and credit lines, defined by the risk involved by the purchasing company. You can rely on Lendmark for customized loans that are hassle-free and budget-friendly. 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 businesss bank account until the obligation has been met. NBC News asked Itria and Biz2Credit why they were taking such an aggressive tack against small businesses during a national disaster. Search the Legal Library instead. And some offered hardship /debt relief or settle your debt for less.. no matter what you call it at the end you still have to pay the creditors, the debts collectors and the lawyer. A few years ago my husband and I had accrued entirely too much debt and no matter how hard we worked or how much we tried, we were unable to keep up with our bills and making the minimum payments was getting us nowhere. A leading provider of merchant cash advances used deception to lure small business customers, then regularly withdrew money from their accounts without consent even after the customers had repaid the money they owed, according to a Federal Trade Commission lawsuit. It was that unfront honesty and eagerness that sealed the deal for me. Theyre highly recommended. Rodolfo P. Queens, NY 6-27-2018, Michael Sininsky is professional and responsive in every aspect of all services provided. The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely. Very pleased with the results. S.P. Search the Legal Library instead. Michael Atleson, Attorney, FTC Division of Advertising Practices, Competition and Consumer Protection Guidance Documents. 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. The agreements are enforceable contracts the borrowers have agreed to, lawyers say, but some of the aggressive collection practices, such as visiting borrowers' homes, aren't legal, they contend. In mid-2018, Runion, an oral surgeon, wanted to add a second location to his practice and had initial approval from a bank for financing. 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 enforce federal competition and consumer protection laws that prevent anticompetitive, deceptive, and unfair business practices. A few years ago I could not imagine a way out of this hole that I dug myself. Merchant Cash Advances came about during the 2008 lending crisis when banks were refusing to lend to most small businesses. "Their strategy was always to get more," he said. "I'll show you what type of loser you are you clown of a man.". Under a typical deal, a business might receive $40,000 in exchange for agreeing to hand over $50,000 in future revenue over a few months. Worked with Michael who was so patient and was very understanding. Itria Ventures of New York City, an affiliate of Biz2Credit, is among the merchant cash advance companies that filed numerous lawsuits in March. This COJ caused further recourse and hence, was deemed to be a loan rather than an actual advance, thus voiding the contract. We wont post comments that include vulgar messages, personal attacks by name, or offensive terms that target specific people or groups. Merchants like Indelicato have been hammered by the coronavirus outbreak. A close analysis will be required to determine the applicable lawsuit defense strategies for each type of business debt. Typically they provide these loans, including merchant cash advances programs, to small businesses in need of working capital. Yellowstone Capital misled potential customers and withdrew additional payments customers did not owe, Competition and Consumer Protection Guidance Documents, or report fraud, scams, and bad business practices at, sign up to get the latest FTC news and alerts, An Inquiry into Cloud Computing Business Practices: The Federal Trade Commission is seeking public comments, FTC Lawsuit Leads to Permanent Ban from Debt Relief, Telemarketing for Operators of Debt Relief Scam, Is Franchising Fair? Rather than infuse the business with necessary funds, the MCA eats away at the businesses revenues and cash, until the ACH repayments (daily or weekly) become cost prohibitive and inevitably impossible to repay. We can negotiate a break from payments for a period helping you to strengthen your cash flow and give you some breathing room. According to the FTC, the company threatened people with physical violence, telling one person they would break his jaw if he didnt pay. In addition to the initial advance, the MCA provider will also charge a fee for the transaction. Thats the gist of the agencys 2020 lawsuit against merchant cash advance outfit RCG Advances, LLC and owner Robert Giardina. Many times, when we successfully get our clients out of debt, they still need assistance with other areas of their financial 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 . When they reached $70,000 a month, he had trouble paying his vendors. They may also help you negotiate for debt relief or a settlement plan. Many random phones calls later, we were fortunate to come acrossed Mike, he has explained to us bankruptcy doesnt mean we will lose our house or car. Readily responds to questions and concerns in detail. Need an experienced Merchant Cash Advance attorney? Download the NBC News app for full coverage and alerts about the coronavirus outbreak. 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. They are filed without a business' knowledge; merchants often learn about them when they try to pay their employees and find their accounts blocked, the lawyers say. Before sharing sensitive information, make sure youre on a federal government site. It is your debt and your money, soyou have the final say in all of our negotiations. 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! To secure the financing, business owners must provide documents detailing their recent sales and identifying their business partners, including their customers, and the amounts they owe, known as accounts receivable. Our Law Firm is Known for Helping Business Owners With This Niche Area of Law (see below). But aggressive lenders are still trying to extract money from their empty coffers. "They're all capitalizing right now on the virus," a beleaguered borrower said, "and saying they are there to help you.". 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. Those allegations are troubling enough, but RCG was just getting warmed up. What a wonderful feeling to be out of debt at last! Whether or not the bankruptcy is filed personally or for your business will determine the result of how the discharge will affect your liability. A screenshot of a text sent to a small business owner. 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. He was kind, calming and very thorough. We can negotiate to lower your daily or weekly payments which will extend the terms of your payback. The laws regarding the filing of Confession of Judgments (COJ) in New York have recently changed. 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. Call the police I don't care.". In hindsight I wish I had declared bankruptcy but this was clearly my decision. The Federal Trade Commission works to promote competition and protect and educate consumers. 5-26-16, I am very grateful of Michael Sininskys assistance to get through the process. On March 27, NBC News contacted Bernard Feldman, a lawyer for PowerUp Lending, about the Indelicato case. 6-13-16, I think you and the company basically do a good job and I appreciate it. Default judgments by MCA lenders and their law firms can be vacated giving leverage to small businesses to pursue resolution of the debt via litigation and or settlement. Shortly after NBC News spoke with Arora, Itria withdrew its court actions against Lone Spur and other small businesses, court records show. The companies generally provide a predetermined amount of money to a business in exchange for future receipts. But there's nobody outside.". 1-21-16. How Do Merchant Cash Advances Work? (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. In addition to potentially saving you money, retaining Dramer Law will save you time as we relieve you of the harassing and embarrassing collection calls you and your employees may get barraged with on a daily basis. We will take our time with you and help evaluate what your best course of action should be. According to the complaint, these fees totaled hundreds and even thousands of dollars, and were not revealed to business owners until, in some cases, after their contracts were signed, leading one business owner to tell the defendants, you guys are like highway robbery.. Business is hurting, Kight said by phone. Another person was told if he didnt pony up, they would falsely accuse him of being a child molester. We would like to say Michael Sininsky is an asset to your company . Thanks! JC, Queens, NY. 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. "You can't have people freezing assets and demanding payments at a time like this. That must change, Chopra said. Proactively addresses potential barriers and issues to prepare clients of required actions and response sets. But since the 2008 recession, they have struggled to get loans from commercial banks, which prefer to deal with bigger borrowers. 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. 2-2-2016, I highly recommend the services of The Law Offices of Kenneth H. Dramer and Michael Sininsky. If they do provide legal advice, they are doing so illegally, and it may not be accurate! Keep in mind the greater the downsides a choice may have the greater the potential for savings. We dont benefit from getting you to hire our law firm, but instead, we benefit when we get the job done for you. An official website of the United States government. 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. 4-6-15, Recently we finished the debt relief program through Dramer Law. When Debt is the Problem We Have the Answers! Lina M. Khan was sworn in as Chair of the Federal Trade Commission on June 15, 2021. They can make all the difference when you're in a situation where you need access to money immediately. The FTC is sending 7,731 checks totaling more than $9.7 million to small businesses who were harmed by Yellowstone Capital, a merchant cash advance company that withdrew money from customer bank accounts without permission. They were patient and very helpful with my case. 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. The Merchant Capital decision is very good news for MCA companies doing business with Florida merchants. The FTC alleged that RCG, Giardina, and others stitched together a blanket of misrepresentations that cloaked the true nature of the transaction. ), "If you don't send money to me today you're done," said a recent text shared by a business owner. It became a cycle of death. We will explain in great detail all aspects of each process including the risks & fees not just how much money you can save. 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! 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? Sincerely , Robert & Michele A. Whitestone, NY 5-25-2015, Dramerhandled my case very professional. To read about this case click here. I am eternally grateful to you and the rest of Dramer Law. If I have any other legal issues that fall within the area in which their office practices, its literally a no brainer for me, I wouldnt go anywhere else. Teresa J., Bronx NY. All this just to get you to sign on the dotted line. Texas attorney Christopher Phillippe thought the deal was simple: Get money up front to pay for litigation costs and pay it back only if he wins in court. If I had any questions or concerns they would answer any questions very quickly and patiently. 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. Highly recommended. G.P. You will be assigned a specific member of our team that will be in constant contact with you throughout the process. The court proceedings were annulled, and agreeable working terms were consolidated with my creditors. Learn more about your rights as a consumer and how to spot and avoid scams. A merchant cash advance, MCA for short, [] Read Now CALL TODAY for your FREE CONSULTATION and let us help you save your business today!
