[Karen37a]

It is unethical for a Broker to put someone into a cash advance and also coach them into default.

Not only is it unethical, it can cross over to fraud.

There is Fraud in the inducement

In order to prove fraud, it must be shown that: 1) one party knowingly misrepresented a material fact 2) with the intent to deceive or defraud the other party. Also, the other party must have relied upon the misrepresentation, and the misrepresentation must cause them actual loss.

[Jess]

I see your point but the merchant would have closed the account, not the consolidator. So the funders claim should against the merchant. Having said all this-I'm strictly referring the conversion claim. Not the funders claim against ISOs violating the ISO agreements who either facilitated the consolidation either themselves or referring the merchant.

[Revenue Consultant]

In light of all this underhanded behavior for obvious personal gain not considering the consequences, I need your expertise. I have had 2 separate merchants come to me recently for help, both of whom were set up with multiple mca's, needing an mca consolidation for better payment terms. Because I did not originate ANY of the current mca's, I am unable to even approach any of the advance companies to renew their mca and pay the others off. So which funders are willing to consolidate for merchants who find themselves in this situation? FYI - neither merchant has more than 3 advances so it's not as bad as it could be.

[Karen37a]

Look up all the loan modification companies that had their assets seized or went to jail...read what you can and cant do.

I am not the compliance officer anymore...

p.s They are regulated

[WestCoastFunding]

In light of all this underhanded behavior for obvious personal gain not considering the consequences, I need your expertise. I have had 2 separate merchants come to me recently for help, both of whom were set up with multiple mca's, needing an mca consolidation for better payment terms. Because I did not originate ANY of the current mca's, I am unable to even approach any of the advance companies to renew their mca and pay the others off. So which funders are willing to consolidate for merchants who find themselves in this situation? FYI - neither merchant has more than 3 advances so it's not as bad as it could be.

Under the perfect circumstances, you could possibly get them consolidated (has real estate, strong balance sheets, etc). But let's think about this realistically, a MCA is pretty much the financing of last resort. 95% of the time the merchant takes them because it's the only option available. So it's hard enough refinancing one advance as it is. But the chance of refinancing 3 advances is so incredibly slim. No one is saying "you know what, I wasn't going to approve you for a more conventional loan before, but now that you've taken 3 advances I'm going to reward you by consolidating...." they'll just end up stacking them, too.

So if they have some real estate with equity, there may be hope. If not, these guys may be headed out of business.

[HDF]

FYI - neither merchant has more than 3 advances so it's not as bad as it could be.

Anything offered that is more than they can afford is "as bad as it could be". These examples are not one-offs, they are becoming the norm. Thus the crux of this entire thread and where MCA is heading.

Diversify your offerings.

[Revenue Consultant]

Thank you. I did take one to an MCA funder to quote for a consolidation and they quoted a 4th position mca. The merchant didn't take it. He doesn't want more money, just a better payment.

[Karen37a]

one more time for those who didn't see

They are Regulated


Chinese wall...bad bad bad move to put your damn name on both companies

Didn't you have a girlfriend, cousin or ex-partners, and a virtual office location?

I better go before I am Torturing in fa ferance

small time

[WestCoastFunding]

Thank you. I did take one to an MCA funder to quote for a consolidation and they quoted a 4th position mca. The merchant didn't take it. He doesn't want more money, just a better payment.

90% chance that merchant will end up taking the 4th. He may not get it from you, but he'll end up getting it.

[HDF]

90% chance that merchant will end up taking the 4th. He may not get it from you, but he'll end up getting it.

TOUCHDOWN! And break at least 3 contracts with no true professional advice of any kind! Good times.

[Revenue Consultant]

I don't want to be the ISO who puts him in a 4th. I know someone will ultimately make money off of my decision not to do so though.

[MidnightAdvance]

http://debanked.com/2017/09/isos-all...osive-lawsuit/

What's with Corporate Turnaround?

[abfunders]

This whole thing is with ISOs coaching them into default.
What if the merchant is legitimately defaulting, and needs help? He's done with MCA, he wants to modify the payments (which the contracts allow him to, really, since it's not a loan - his revenue is down, or whatever), he just doesn't know how.

A friend of mine's brother runs a company that says, "We only deal with companies on the verge of bankruptcy or extreme stress, don't coach into default."

What's the community's response:

Is it wrong to help them out if there is no other resource? I had an outbound call one time who was in that situation. Too stacked, ready to default, was signing up with Corp Turnaround - this was before the Reverse Consolidation existed and I was new in the industry, didn't know the rules quite yet.

Should I have passed him over to this guy?

If they're not qualified for a reverse, and they WILL default, they need help - do we as brokers just let them file bankruptcy and the funders get paid less, later?

We should want to do the community standard, not just make money. That's why I'm asking. I don't send to these people - I just didn't send to one, in fact (3 MCAs, freezer broke, lost $6000 in food in $6000 in repairs), now recovering. I wouldn't send her there, and she didn't want, either.

Is there ANY place for these people?

[MCNetwork]

If the merchant is genuinely defaulting, he should first contact the funder to prove hardship and possibly work out a new payment schedule. Barring any progress on that front, he should see a bankruptcy attorney for advice. These MCA debt consolidation companies are wolves in sheep's clothing who make the situation worse. I haven't seen one that legitimately helps.

[Karen37a]

If the merchant is genuinely defaulting, he should first contact the funder to prove hardship and possibly work out a new payment schedule. Barring any progress on that front, he should see a bankruptcy attorney for advice. These MCA debt consolidation companies are wolves in sheep's clothing who make the situation worse. I haven't seen one that legitimately helps.

I just had a Funder put a hold on someone's processing after they asked for 1 week of forgiveness on payments. their electricity was out for 7 days

They had a month where they had 7 nsfs but then went back on track....last 30days they had 2 NSF

They actually put a hold on their processing.

They are Puerto Rican, their staff is Puerto Rican and trying desperately to get word on their families ...no water or food in Puerto rico.So I can see why people won't do it .. ( not trust the funders or brokers, because we do not trust some brokers and funders either..imagine how they feel being on the outside of all this )

I had 3-5 deals backdoored in my short time in the MCA business ( that I am aware of) and I never complained or said anything.Never used the Daily funder as a sounding board to complain about backdooring. I just saw it as part of being in an industry full of Shady / Greedy Characters.( on all ends ) But I really can't stand watching someone kick someone when they are down

I am fuming mad and maybe they think ...too bad..or she is nothing or she will get over it.I can now see how some people get to that position.

I will be sending in a formal notification that my company will no longer be an ISO with them..so I cant get accused of Torture ous in fa fa ence in the future.

And yes there are ethical Loan modification companies and ethical Debt Restructuring companies. A lot of Mortgage brokers did HAMP loan modification ( or debt restructuring ) after the crash. Which is is why some know the laws and rules like the back of their hand.

The problem is when Brokers purposefully help fund someone with default in mind, and they are on both ends of the deal.

[Karen37a]

Non-compete agreements also have to be honored 2 ways

If someone doesn't get paid commission on a deal it can void the agreement. One side does not have to be held up to a certain standard and the other does not

"clean hands"

Also a substantial business relationship must exist...information that is public or leads passed to everyone known to mankind do not meet that test

equitable estoppel and putting people in harm's way by their actions.

If merchants decide to "sue" they are going to sue everyone who put their hands on that contract. Including the broker or Iso..in fact I think they would sue the broker or ISO first because that is the person they had the most interaction with.

Any Iso playing around with Funders who do not know what they are doing are taking huge risks

I am still waiting for someone to chime in that I need to send a deal to certain companies with the lowest rate

[Michael I]

This whole thing is with ISOs coaching them into default.
What if the merchant is legitimately defaulting, and needs help? He's done with MCA, he wants to modify the payments (which the contracts allow him to, really, since it's not a loan - his revenue is down, or whatever), he just doesn't know how.

A friend of mine's brother runs a company that says, "We only deal with companies on the verge of bankruptcy or extreme stress, don't coach into default."

What's the community's response:

Is it wrong to help them out if there is no other resource? I had an outbound call one time who was in that situation. Too stacked, ready to default, was signing up with Corp Turnaround - this was before the Reverse Consolidation existed and I was new in the industry, didn't know the rules quite yet.

Should I have passed him over to this guy?

If they're not qualified for a reverse, and they WILL default, they need help - do we as brokers just let them file bankruptcy and the funders get paid less, later?

We should want to do the community standard, not just make money. That's why I'm asking. I don't send to these people - I just didn't send to one, in fact (3 MCAs, freezer broke, lost $6000 in food in $6000 in repairs), now recovering. I wouldn't send her there, and she didn't want, either.

Is there ANY place for these people?

your assumption is that they HELP the merchant and it is just unethical for us to send it . I know and confrimed 2 cases of merchants of mine that used those types of services.
case 1 had a 15 month deal with bfs they called him and convinced him that they can lower his pay back since it is usury blah blah blah . they got his payback lowered to like 1.08 charged him like 15% and saved him like 15% .fastfoward 6 months merchant got declined for his mortgage since bfs had a judgement on him . he called me up freaking out not understanding what went wrong and how they can put a judgement on him. he totaly was mislead
case 2 had a on deck 100k 1.23 9 month deal used one of those companies that told them for a 10k fee we can get your term stretched out to 18 months . merchnat is not understanding why he cant renew now that he is 50% paid off like i told him . i tried explaining he is in default and he is like no , i paid 10k to stretch out terms . no one explained to eother of these merchants that it was hitting their credit that they will never be able to get financing again.

[Karen37a]

your assumption is that they HELP the merchant and it is just unethical for us to send it . I know and confrimed 2 cases of merchants of mine that used those types of services.
case 1 had a 15 month deal with bfs they called him and convinced him that they can lower his pay back since it is usury blah blah blah . they got his payback lowered to like 1.08 charged him like 15% and saved him like 15% .fastfoward 6 months merchant got declined for his mortgage since bfs had a judgement on him . he called me up freaking out not understanding what went wrong and how they can put a judgement on him. he totaly was mislead
case 2 had a on deck 100k 1.23 9 month deal used one of those companies that told them for a 10k fee we can get your term stretched out to 18 months . merchnat is not understanding why he cant renew now that he is 50% paid off like i told him . i tried explaining he is in default and he is like no , i paid 10k to stretch out terms . no one explained to eother of these merchants that it was hitting their credit that they will never be able to get financing again.

Same % of rouge or bad brokers /companies in the debt restructuring business as the merchant cash advance industry or credit restoration

[Karen37a]

It's not and moreover while the filing addresses the true up nature of MCA as well the risk taken by YS and EBF because an MCA is not loan. Asserting dominion over a merchants bank account does not do the "Mca" is not a loan and the funders have an unsecured purchase of future receivables argument any favors.

Jess this is a very valid argument...we can charge x factor rate because it's not a loan...but then some want to treat it as a loan in collection.

The processing companies have not been dragged into the mess ...yet. Someone will one day figure it out. Thats why people should not abuse the process.

Wait until someone makes the argument that they had a real "fiduciary duty " to protect their funds and not just side with a Funder because the funder said or some silly litlle power hungry kid who thinks he is mr fancy pants working for a collector scaring old ladies into paying their old verizon bill that never existed bragging how they are "tough on collections"

[WestCoastFunding]

Oh, stop it, Karen.

[Karen37a]

Oh, stop it, Karen.

West didnt you want regulation? Bring it on now... all the smart institutional money has fled, some ducked for cover.

[Cash_Village]

West didnt you want regulation? Bring it on now... all the smart institutional money has fled, some ducked for cover.

Smart institutional like?

Doubt any institutional would want to invest in unregulated environment. So when pwc and kpmg and the likes audit thier books and find out what are cash advances....exactly

[WestCoastFunding]

West didnt you want regulation? Bring it on now... all the smart institutional money has fled, some ducked for cover.

Karen you go way too far with your assumptions and hypotheticals. Somewhere, Alex Jones is reading your comment and saying "she's gone too far! What she wrote is crazy!"

[Karen37a]

Smart institutional like?

Doubt any institutional would want to invest in unregulated environment. So when pwc and kpmg and the likes audit thier books and find out what are cash advances....exactly

Institutional investors include hedge funds and investment banks and it really just a term used for the "Big whales"

The people who set up $$ thru insurance companies etc wind up getting charged with Rico.Certain entities that are regulated slap back if they lose money, they have the power to use the regulatory bodies to their advantage.

Credit from banks have caveats and restrictions

You have to raise money thru accredited investors disclose that they can lose all their money and that's that. And you must use your private data bank of people you know...no advertising.

Like private placements, hedge funds etc, other ways to secure the funds. It's not easy to do. And like you said. If someone could do it they wouldn't/shouldn't be playing around on the df.

Some people wait until the perceived bottom to not get caught in an avalanche of lost $$ and lawsuits etc

[Karen37a]

Karen you go way too far with your assumptions and hypotheticals. Somewhere, Alex Jones is reading your comment and saying "she's gone too far! What she wrote is crazy!"

West I have no clue to what you are referring to. I personally did not want regulation because as I said over and over on these boards, people will go under because they will not be able to raise capital.

People said i had other reasons for not wanting it.And it wasn't true and I was right.

This thread is being hijacked off topic ..people being sued by Yellowstone and ebf for debt restructuring. Create another post to change the subject matter.

And I am not commenting on this thread again