The New York State Attorney General’s office recently came to a settlement with 25 Merchant Cash Advance creditors to have at least 1,100 judgments vacated and the debts discharged against small businesses. The Attorney General was suing the MCA companies for some time alleging fraud, usury, and deceptive practices amongst other claims. The AG’s office had made the argument that these loans were disguised as merchant cash advances but were in fact usurious and fraudulent loans with extremely high interest rates. The settlement reached requires the MCA creditors to dismiss matters totaling over $500 million of debt nationwide. This also includes dismissing any active or potential lawsuits and prevents the MCA lenders from conducting business in the future. The settlement also significantly includes the release of all UCC liens against businesses by the MCA creditors. These UCC liens are as damaging as a default judgment given that MCA creditors send them to online payment platforms such as Venmo, PayPal and others, as well as merchant processors such as Square and Stripe in order to freeze funds rightfully owed to the business. This decision is significant in helping thousands of businesses across the country who are defending themselves against Merchant Cash Advance lenders.
The MCA creditors involved in this settlement with the AG include common MCA creditors that we often defend businesses against:
Yellowstone Capital LLC, Fundry LLC, ABC Merchant Solutions LLC, Advance Merchant Services LLC, Business Advance Team LLC, Capital Advance Services LLC, Capital Merchant Services LLC, Cash Village Funding LLC, Fast Cash Advance LLC, Fundzio LLC, Green Capital Funding LLC, HFH Merchant Services LLC, High Speed Capital LLC, Merchant Capital Pay LLC, Merchant Funding Services LLC, Midnight Advance LLC. MR Advance Capital LLC, Ocean 1213 LLC, Simply Equities LLC, TVT Cap Fund LLC, TVT Capital HR LLC, Thryve Capital Funding LLC, WCM Funding LLC, West Coast Business Capital LLC and World Global Capital LLC.
Defending a MCA lawsuit or vacating a default judgment obtained by a MCA lender should be handled by an attorney that has extensive experience in this niche field. Preventing default judgments in these matters is crucial given the very high percentage of defaults obtained. Alternatively, filing motions to vacate a default must be done quickly and proper defenses such as deception, fraud, and usury mentioned above must be asserted in many if not most of these matters. This is important no matter if the business’s goal is to litigate the case toward dismissal or settle the matter to obtain a reduction and interest free payment arrangement.