|08/26/2020||SBA loan brokers in VA indicted|
|01/24/2020||MCA brokers take on South Africa|
|04/05/2019||4 of 5 indicted loan brokers released|
|03/15/2019||5 business loan brokers indicted|
|08/22/2018||Loan brokers charged by SEC|
deBanked San Diego 2019 - Brokers are Undertrained
deBanked Visits Horizon Funding Group
Merchant Cash Advance Agreements
Ronald A. Smith and Terri Beth Miller, owners of Virginia-based Business Development Group (BDG), an SBA loan brokerage, were indicted this month over an advance-fee scheme in which many customers are alleged to have paid money to obtain SBA loans but did not in fact get them.
As part of the scheme, defendants are alleged to have made many false and misleading representations to prospective borrowers including that:
- BDG was a large, multi-state company
- BDG was headquartered at the Trump Building in New York City and had an additional business in Las Vegas
- BDG has assisted certain named companies in obtaining SBA loans
- BDG was a business established in 2005 or earlier
- BDG was affiliated with the SBA
- BDG had relationships with banks across the nation that allowed it to facilitate the loan approval process with SBA lenders in a customer’s area by utilizing a “Lender Linker” made up of the most preferred SBA lenders in the country
- BDG had a program that included a “Powerful Online Grant Writer Interface Service” that was directly connected to the federal government and “handled everything from A to Z in Finding, Writing, Submitting and Securing Grants”
- BDG offered a money back guarantee
- BDG won the 2016 Best of Manhattan Business Award for Business Development Software and Services
BDG was really just an internet-based business whose goal was to obtain money through fraudulent pretenses and promises, prosecutors contend.
A copy of the grand jury indictment can be obtained here.
A survey conducted by Overland Park, KS-based Strategic Capital revealed that only 36.8% of respondents plan to completely return to the office full-time after cities fully open back up. The vast majority of respondents were small business finance brokers.
44.7% selected that they would minimize office space or only use office space to house core team members while 18.4% planned to terminate their office lease altogether and adopt a work from home model permanently.
Watching the Super Bowl, you may have seen a number of oddities: the resurrection of a peanut as an infant, the tattooed inside of a popular rapper’s head, Google’s plea to be the hub for all your elderly relatives’ memories, and, on top of it all, a cheeky spar between mortgage lenders.
Quicken Loans, the Detroit-based mortgage provider, had an ad that featured Hawaiian actor Jason Momoa reveal his ‘true’ self, all while explaining the values of Quicken’s Rocket Mortgage product. Par for the course with Super Bowl ads, until United Wholesale Mortgage’s advert aired. Throwing shade at it its competitor with the line: “Playing with rockets is great when you’re a kid, but when it’s time to get a mortgage, you quickly realize a rocket is complicated and expensive,” United promoted its FindAMortgageBroker.com website, which points potential customers towards a host of brokers local to themselves, before closing its ad with the #brokersarebetter hashtag.
Speaking to The Detroit News about the joke, United CEO Mat Ishbia said: “I don’t think we attacked (Rocket Mortgage); we had fun with it … I think it’s going to grow their business just like it’s going to grow ours. I think (Quicken founder) Dan Gilbert and (CEO) Jay Farmer are going to laugh when they see it. They won’t like it enough to chip in with the cost. The reality is we’re friendly competitors.”
Being a wholesale lender, United gains customers exclusively from its brokers, where as Quicken engages with both brokers and its own marketing efforts. In a call with deBanked, United’s Chief Marketing Officer, Sarah DeCiantis, explained that this was one of the main motivators behind the ad. Noting that for local, independent brokers it can be a struggle to compete with behemoth retail lenders, DeCiantis said that the ad was an answer to the question of ‘How do we allow them to get out there?’ “Retail are amazing at marketing and customer retention, so we try to do what we can to put [independent brokers] on the same playing field because they don’t have the same budget.”
And with only 30 seconds to express this, the challenge was on — not to mention how such ads are estimated to cost $5.6 million. “So much thought goes into every frame, every second,” remarked DeCiantis, who said she was proud of the final product. “We’ve gotten over 75,000 searches on the website just in the first few days after the ad.”
The high profile decision to purchase Super Bowl air time comes during what looks like will be a big year for United, with it planning to add an additional 3,000 employees to its already 5,000-strong staff in its Pontiac headquarters. Despite this, according to Ishbia the focus is still on the local: “If a consumer goes through an independent mortgage broker it will be faster, easier and more affordable than going through a retail lender or mega bank.” From his point of view, it just makes more sense to go independent, it isn’t rocket science.
The battle is on between lenders and brokers in the mortgage space as middlemen try to out-compete push-button loan technology.
Quicken Loans ran a Super Bowl Commercial that featured Game of Thrones Actor Jason Momoa aka Khal Drogo and its Rocket Mortgage product. The theme, that of being super comfortable in your home, is a complete 180 from the controversial route the company took during a previous year’s Super Bowl that prompted a negative response from regulators and viewers. Even if you’re not in the market for a mortgage, Momoa revealing “his true self” is pretty humorous.
But not everyone is a fan of what online direct lenders are selling. FindAMortgageBroker.com criticized “playing with rockets” when it comes to mortgages and advocated working with an independent local mortgage broker instead. Why work with a broker they say? Because brokers work with various lenders instead of just one. The company goes as far as saying that brokers are faster, easier, and more affordable and they sign off with the hashtag, #brokersarebetter.
Check it out…
The owner of a Long Island based ISO/loan brokerage and several employees have been arrested, Newsday reports. Demetrios Boudourakis, whom deBanked has previously reported on, is charged with grand larceny, money laundering and other crimes for his role in an advance fee loan scheme. Boudourakis allegedly led a fraud ring that stole more than $2 million from small business owners nationwide. Six other defendants have also been charged with related crimes. They include Nadim Afzali of Hicksville, Tanya Balbi of Farmingdale, Christopher Looney of Bethpage, Joseph Johnson of Brentwood, Jude Brun of Elmont, and Michelle Soccodato of Hicksville.
The investigation began last year and involved numerous agencies, including the Suffolk and Nassau police and sheriff’s departments, New York State Police, the FBI and the Drug Enforcement Administration.
According to Newsday, “Boudourakis and his associates, through the dark web, obtained the names of people who had been denied loans. They would then call those people to tell them they had qualified for loans but would have to pay interest and fees upfront.”
According to Long Island Business News, law enforcement agents who executed search warrants at several locations recovered electronic equipment, three handguns, a sawed-off shotgun and a pill press. The investigation leading up to the bust included court-authorized eavesdropping and audits of financial records and physical and electronic surveillance.
Previously, deBanked reported that JTT Funding, Boudourakis’ company, had been accused of forging a Confession of Judgment and impersonating rival companies. Those were civil cases, not criminal cases. Court records show that those cases remain ongoing.
Among the company names the ring used in the alleged scheme were Federal Business Lenders, Federal Business Funding, JTT Funding, JTT Global Holdings, Inc. Blackrock Funders, Inc. and Blackrock, Inc. It is possible that some of those names closely resemble names of competitors and the actual companies have not been accused of any wrongdoing.
Boudourakis is a retired MMA fighter. His nickname in the ring was “The Tyrant.”
Four of the five loan brokers indicted in a fake business loan scam that tricked an Ohio resident out of hundreds of thousands of dollars in upfront fees, have been released on bond. Only one, a defendant by the name of Haki Toplica, remains in custody. All of the defendants have entered pleas of not guilty.
In addition to the victim being asked for hundreds of thousands of dollars in upfront fees to apply for phony loans, he also signed over the title of 55 vehicles to the defendants to serve as the collateral. The vehicles included a Ford Mustang, several dump trucks, several tractors, several restored classic vehicles, a Freightliner motor home, and trailers.
Toplica was arrested in December and his co-conspirators in March. All of them are New York residents. The condition of one defendant’s release was that she remain working with her present employer. deBanked determined that her most recent employment was ironically that of a business loan broker.
Five business loan brokers were named in a federal indictment in Ohio for defrauding a 69-year-old business owner out of his money and cars. In addition to being asked for hundreds of thousands of dollars in upfront fees to apply for the loan, the victim signed over the title of 55 vehicles to a broker to serve as the collateral. The vehicles included a Ford Mustang, several dump trucks, several tractors, several restored classic vehicles, a Freightliner motor home, and trailers.
In reality, there was no loan.
Text messages quoted in the indictment indicated that one of the defendants traveled from New York to Youngstown, Ohio by Greyhound Bus to begin driving the vehicles back to New York one-by-one, but their scheme faced challenges when they could not afford the gas to drive all of the cars. By the end, the victim was cooperating with the police and one of the defendants was lured back to Ohio in September to pick up a payment where he was then arrested.
deBanked discovered a message board post that appears to be published by one of the defendants months after the alleged crime. In it, she attempts to recruit other brokers to send her business with promises of high commissions, same day approvals, free leads, and a policy of no backdooring.
While holidays, including New Year’s Eve, are usually slow days for funding, for some brokers this year, New Year’s Eve was a strong day.
“New Year’s Eve was not a slow day here,” said Elana Kemp, a broker at Fundomate, in Los Angeles, who was in the office that day. “It was amusing to see so many people looking for money on the last day of the year. I’m also a procrastinator, so I can relate,” she said.
Zach Ramirez, Founder and Managing Director of ZR Consulting, LLC in Orange County, CA, said that New Year’s Eve was the second biggest funding day for his company in December, despite the fact he told his brokers that it was an optional work day, he said.
At the same time, for many other brokers, business was on the slow side, as expected. John Celifarco of Horizon Financial Group in Brooklyn, said it was a good day to organize and prepare for the new year. Meanwhile, Joe Cohen, of Business Finance Advance in Brooklyn, said he generally doesn’t go to work on major holidays.
“The holidays are to enjoy, regenerate and spend time with the family,” Cohen said. “That’s why you’re working anyway.”
Looking for teams in Florida...
looking for teams in florida las olas. beautiful new office with a team of 4 already in there funding 800k to 1.2m per month we provide everything lea...
FRAUD ALERT ..Gold Capital Funding!!!!...
there is a company called gold capital funding posing as a lender they steal your deals and fund them direct they also take lenders offers and shop to...
brokers. the only exceptions seem to be the big guys such as rapid/kapitus, etc., , dm me...
brokers out there to get quality leads and help them funded deals. , and about your point to work with a direct funder and be a broker, it's not actually about being good or bad , it's just not the business model we are looking at this moment as we are providing our service from outside of usa.so, it's technically not possible to become a iso or broker and we will never send any kind of unfunded/dnq and difficult to work with merchants. we use ucc and targeted data also.we purchase the data and set the campaign according to client's demand and requirements ....
brokers face and try to avoid such issues(poor communication, deals being killed for miniscule reasons, etc). i took an interest in underwriting and deal structures which ended up in me getting into underwriting and underwriting for some of the most reputable companies in the space either as servicer(including for some of the companies on your list) or directly, and have made a name for myself amongst underwriters and investors in this industry due...