[Karen37a]

Another person was arrested for producing or conspiring to produce bad documents (invoices) or verifications to facilite a factoring "loan" or advance

https://www.justice.gov/usao-ndoh/pr...-act-illegally


Rico charges for some, fraud for others etc. This is why no one should ever enter this business and put themselves in a "fiduciary" or a compliance position over contracts, money and people unless you are making $$$$$$$, and know what you are doing.


( this is also why underwriters go thru files and look for discrepancies, its not just about losing money...which is bad enough)

***Ive said before when people lose millions they dig thru your underwear drawer to see why and take action against you if you did somethng wrong or slightly wrong..sometimes just to get leverage against you to get the money back

[Eagle Funding]

One of those people was a very active member on our forums

[Karen37a]

One of those people was a very active member on our forums

He would always ask me "what town" "what industry" my deals were in and I would ask him if he thought I was stupid.

He personally caused me to not trust people who were associated with him. ( who I think are nice now)

[anydealfunded]

Bad grandpa Bob

[Karen37a]

Bad grandpa Bob

lol

Id say "God save me" but I am saving that for the hurricane, not the Financial Services industry

[WestCoastFunding]

The most shocking thing: Bob is 71.

[Michael I]

oh wow i always liked and trusted that guy

[HDF]

oh wow i always liked and trusted that guy

He told me he was in his 80s. Trust and verify folks, money brings out the worst in people.

[nrh1lp]

Honestly I wasn't a hug fan of Bob, I had one deal I tried to work through him (at the time I didn't really have any other half decent factors) and he missed to conference calls in two days that he scheduled with the merchant. On top of that, the rate was about 2x/wk what kevin/richard would have offered. Haven't talked to the guy since then.

[Karen37a]

He was actually mean . Like an old Carney and wouldnt care if he "took you"....my impression

Its hard to watch people when you have this deep deep suspicion something is wrong with them...

[WestCoastFunding]

Rico charges for some, fraud for others etc. This is why no one should ever enter this business and put themselves in a "fiduciary" or a compliance position over contracts, money and people unless you are making $$$$$$$, and know what you are doing.

This has nothing to do with fiduciary duties and responsibilities. It has to do with Bob creating and directing employees to make fake documents to defraud a lender.

[Karen37a]

This has nothing to do with fiduciary duties and responsibilities. It has to do with Bob creating and directing employees to make fake documents to defraud a lender.

Others have been charged with rico because they lost money...I am not going to debate the future.

Ive lived it thru 4 market crashes


The point I am making is no one should just create an llc and "try" the business...there are compliance rules...and fiduciary is complex and you can be tied into something by association.

Also Most of the fraud winds up being commited by the Lenders/funders...not independent outside brokers

[admin]

Assuming it's indeed him, his account has been banned. The last day he logged into his account was on the DOJ sentencing date.

[abfunders]

If anyone wants to know anything about Iron Horse for factoring, please do contact me. Bob had nothing to do with them internally. They made me an incredible offer recently (same day), but they couldn't beat another offer that was being offered in rates. However, neither of them could offer the client the product that he wanted, so neither of them funded him.

[nathan0613]

sad that people need to resort to deception and stealing....

[Sachip24]

wow...I spoke with him numerous times for factoring smh

[brokerCompany]

Bob always seemed a little shady when speaking with him. Decided not to do business with him. I think the times caught up to him and he was trying to catch up to all the young bloods making a killing.
There is a reason I do not work with any other brokers..

[ADiamond]

Indian Tribe Online Lender Fraud Scheme Sends 2 to Prison


In unrelated news, here's another article about fraudulent docs as it related to invoice factoring i believe. SOURCE: justice[dot]gov

GREAT FALLS – Former Chief Executive Officers for Plain Green, the Chippewa Cree Tribe’s internet lending business, were both sentenced today to several years in prison by U.S. District Judge Brian Morris in Great Falls. Neal Paul Rosette, 54, of Box Elder, who served as the lending corporation’s CEO from its origination until January of 2012, was sentenced to 38 months in prison and restitution of $1,488,472. His colleague, Billi Anne Morsette, was sentenced to 41 months in prison, and $1,421,045 in restitution.

In December of last year, Rosette and Morsette pleaded guilty to accepting bribes from Encores Services, a Las Vegas business, in exchange for facilitating the award and payment on fraudulent tribal contracts. In another indictment the two pleaded guilty to helping Chippewa Cree Tribal Vice-Chairman John Chance Houle siphon off over $55,000 in tribal monies, laundering them through First American Capital Resources, the predecessor company to Plain Green, and then diverting the money to the Chippewa Cree Rodeo Association accounts which Houle had used as a slush fund. Included in their pleas was a plea by Rosette to income tax evasion and by Morsette to willful failure to file tax returns.

In court records filed at the time of the plea, the Unites States Attorney’s office advised the Court that in May of 2010, the Chippewa Cree Tribe created First American Capital Resources, LLC (FACR) to be a partner with outside interests to provide a pay-day, on-line lending platform which, using tribal sovereignty, could be exempt from state laws and regulations regarding usury and predatory lending practices. The FACR CEO was Neal Rosette, the FACR COO was Billi Anne Morsette, and the Chairman of the oversight board created by the tribal council to administer the internet lending program was tribal Vice-Chairman, John Chance Houle.

THE RODEO ASSOCIATION EMBEZZLEMENT: On September 15, 2010, Houle authorized and signed a $27,949.33 check to FACR from the Chippewa Cree Tribe Tribal Grants and Contracts account. Once the Grants and Contracts money was in the FACR account, a check for $6,000 was made payable to Rosette (signed by Morsette) and another check for $6,000 was made payable to Morsette (signed by Rosette). Also on that same date, a check for $15,000 was written to the Chippewa Cree Tribe Rodeo Association and signed by Rosette and Morsette. Chance Houle was the President of the Chippewa Cree Rodeo Association with exclusive control over its bank account.

The second payment from the Grants and Contracts account to FACR was made on October 5, 2010, for $27,842.94. On that same date, a FACR check for $4,000 was made payable to Rosette (signed by Morsette) and another check for $4,000 was made payable to Morsette (signed by Rosette). Also on that same date, a check for $15,000 was written to the Indian National Finals Rodeo (INFR), and signed by Rosette and Morsette.

THE IDEAL CONSULTING KICK-BACK SCHEME: On October 22, 2010, FACR, the Tribe, and Encore Services Corporation, of Henderson, Nevada, entered into a Management Agreement making Encore the tribe’s partner in the on-line lending business. FACR and Encore did not make any online loans prior to April 2011. The salaries of Rosette and Morsette were subsidized by Encore and its affiliates, along with James Eastlick, Jr., Clinical Psychologist at the Tribe, through bridge loans. One specific loan from Eastlick to cover the salaries of Rosette and Morsette was in December 2010 for $60,000, and the note on the loan was between Eastlick and Encore.

In March of 2011, after Rosette had entered into negotiations with Think Finance of Fort Worth, Texas, the Tribe created another online lending company, Plain Green. Plain Green was created for online installment loan lending and, as with FACR, Plain Green would utilize the Tribe’s sovereignty to shield the business from state usury and predatory lending laws. Rosette, Morsette, and Houle all remained in the same positions for Plain Green as they had for FACR. After Rosette’s departure in January 2012, Morsette took over both the CEO and the COO roles for FACR and Plain Green.

After a deal was struck between the Tribe, Plain Green, and Think Finance, Encore was no longer a relevant participant. On May 4, 2011, and at the request of Encore, a revised management agreement between FACR and Encore was signed. Under this agreement, Section 2.9 now stated the “Enterprise” shall include FACR “and any other entity formed by the Tribe to undertake business of the type conducted by FACR.” This is after Plain Green and Think Finance have already started making loans in April. The amended agreement was designed to provide “exclusive” rights to Encore with regard to all of the Tribe’s online lending ventures, including Plain Green. Rosette forged Houle’s signature on the revised management agreement.

On July 11, 2015, without any written agreement as to fees, Rosette and/or Morsette wired $38,242 of the Tribe’s share of the Plain Green distribution, to Encore. In late July 2011, a Fee Agreement was executed providing Encore Services, LLC, a newly formed company owned by the same individuals of Encore Service Corporation, 15% of all profits from the Plain Green – Think Finance venture. This agreement was backdated to June 1, 2011, one day before Plain Green received its first payment of $199,141.

On August 3, 2011, an entity called Ideal Consulting, LLC, invoiced Encore for “5% consulting fees” for the months of May, June and July 2011. The total billed was $50,652.40. That same day, Plain Green wired $93,800.42 to Encore Services. Ideal Consulting had registered with the Montana Secretary of State’s Office on August 2, 2011. Eastlick opened a bank account using the articles of incorporation for Ideal Consulting at Wells Fargo Bank in Havre, and on August 5, 2011, an Encore affiliate wired $50,652.40 to the new account.

At its essence, the scheme that began with the second agreement was designed to put Encore back into the tribal stream of revenue from the on-line lending operation once Think had come in to supplant Encore. In exchange for giving Encore 10% of the tribe’s revenues, Encore agreed to take 15% and kick 5% back to Rosette, Morsette, and Eastlick as a reward for keeping money flowing to Encore, even though it had not been able to establish a viable lending operation.

The relationship with Encore, and the resulting payments to Ideal, continued for the next two years, until July 31, 2013. In that time, Plain Green paid Encore $3,523,471, and Encore paid Ideal $1,208,395. The profits from the scheme were split evenly between Rosette, Morsette and Eastlick—each taking over $400,000.

During this period Morsette received over $800,000 in income from her salary and the payments from Ideal. She never filed a tax return. As part of her plea agreement she agreed to pay $165,253 in tax liability to the IRS. Rosette filed for 2009 but did not file any returns after that. Based upon his unreported income, Rosette agreed to pay $232,680 in tax liability to the IRS.

Rosette was allowed to surrender himself to the institution once the Bureau of Prisons designates where he will serve his sentence. Morsette was immediately remanded into the custody of the U.S. Marshal.

The case was brought by the federal agents of the Guardians Project and was investigated by the agents of the Offices of Inspector General of the Departments of Interior and Health and Human Services, as well as by the Internal Revenue Service Criminal Investigation Division.

[WestCoastFunding]

Unfortunately for Bob, when his sentence is completed he's facing deportation to Michigan of all places.

[MCAVeteran]

sad that people need to resort to deception and stealing....

Your kidding right? Isnt that what goes on in this business daily? As one colleague put it, until you remove all the bad actors, it will always be around

[golf2014]

Mca veteran..bingo. many many things in life are part of deception and manipulation. People try and get a scheme that might work. In this industry..the lies and cheating etc..is off the charts. Article stated bob was 77

[Jess]

Others have been charged with rico because they lost money...I am not going to debate the future.

Ive lived it thru 4 market crashes


The point I am making is no one should just create an llc and "try" the business...there are compliance rules...and fiduciary is complex and you can be tied into something by association.

Also Most of the fraud winds up being commited by the Lenders/funders...not independent outside brokers

Biggest risk is with syndication. Period. There are risk management firms that are now providing ratings for syndication platforms. Regional accounting don't have a good grasp of the regulations (bought can certainly be bought for a fee!) or the cash flow and/or custody issues. The Big 4 are unlikely to take on this type of client.

[WestCoastFunding]

Others have been charged with rico because they lost money...I am not going to debate the future.

Ive lived it thru 4 market crashes


The point I am making is no one should just create an llc and "try" the business...there are compliance rules...and fiduciary is complex and you can be tied into something by association.

Also Most of the fraud winds up being commited by the Lenders/funders...not independent outside brokers

Again, this is a case where Bob admitted to creating fake documents and directed other employees at the company to create fake documents -- all to defraud a lender.

This has nothing -- NOTHING -- to do with fiduciary duties of a financial advisor or broker. Absolutely nothing. Zero. He wasn't "tied into something as a fiduciary." He personally committed fraud and directed others to commit fraud.

[RFG]

Wow I thought I knew Bob reasonably well- never had any issues with him personally, but clearly his moral compass was "screw lenders" and not "screw brokers" as far as I know.

Edit- Clearly both are wrong, just wanted to share my experience in dealing with him.

[Karen37a]

Biggest risk is with syndication. Period. There are risk management firms that are now providing ratings for syndication platforms. Regional accounting don't have a good grasp of the regulations (bought can certainly be bought for a fee!) or the cash flow and/or custody issues. The Big 4 are unlikely to take on this type of client.

The biggest risk is with syndication But Big isos watching over brokers have compliance issues as well...

2 weeks in the business i caught bad /fake documents from merchants and asked what the hell was going on