Sean went, when you hear about this. I mean it's 100,000 essentially
almost 800,000
dollars. Almost. What
are your thoughts? Yeah. I think the number is meaningless, and
the only meaningful part of his story is that the fact that somebody
would actually indicted for departing a merchant cash advance companies. I
think that's, that's the headline that grabs everyone's attention yesterday. I
think that MCA companies, small
business lenders, that aren't banks are so used to being defrauded without
there being any
It's to those who are trying to defraud them. They're exhausted
by it. They're annoyed by it. There's nothing they
can do about it. Whenever they complain to the authorities. They
say it sounds like a civil matter. If you're really so bothered about
it, won't you go and sue them? Don't bring it to us. That's
the that's the response. They generally get. Now,
when you defraud a bank you can do the smallest thing and like,
hey, you know, you miss stated your income last year.
That's 10 years in present you defer to the bank. Yeah. Now you
send in fake bank statements, you forge all the
Pants, you do fake references, you phony
up to application to a small business lender. That's not a
bank or an MCA provider. And they say, I
think this is fraud and they're like, oh well,
yeah, you got me. Yeah, what are you gonna
do about it? Nothing happens? Because if you
report that applicant to the feds, they just don't
care. That's been the trend. So everyone just kind of down in
the dumps because here they read stories about
them in the news about how all the things that they're
doing.
- for small business there, you know being
criticized constantly about this is too much. This
is too slow. You know, Big Data, blah
blah blah, blah blah, and they're like, we're being defrauded all day every day
and what and we can't do anything about
it and nobody cares. And so when you see a story that somebody with
indicted for defrauding, one of these providers people
are like, yeah, thank you
for acknowledging. The fact that people are trying to defraud us,
right. Yeah. I wish that, you know, they probably wish
that
that everyone who's trying that would also get indicted you'd
have probably a million people in prison. Yeah, people
know not to defraud the bank because if you do, you
get 10 years in jail, so they go to the other online lenders say I'm
going to defraud that guy because nothing will happen to me. Yeah, it's
a bad precedent that's been set. Hopefully stories like this
change, the mindset of people saying, just because it's some online
company or a small business finance company that, you
know, only through phone and email that if you commit fraud, you
can end up in prison. Now granted, this person has only been indicted.
Have been convicted of anything. So at this point is
only allegations, but the doj was
very specific about what happened. I mean, in hide would
happen that the headline by the doj was
that this person de frauded merchant, cash
advance companies. That's a headline. You think you'd
never see, like, we got them. He defrauded them. See, a company's this
person is now under indictment. That's
the major, the major thing about
this new story. That's why it's so relevant. It's not
it's not necessarily a dollar amount. It's possible that it was more
but they only got them on these particular things. Yeah, you know, I don't
know, all the individual details, but you did, you
did raise an interesting fact of, you know, how did he do it?
And there's only, there's only so much you can do
in underwriting to verify. Yeah. Someone's
ownership in the business, right? Yeah, and
if you owned it today, but you sold it tomorrow and
you apply for financing. The next day. They
might not know that you've sold it. Yeah, because whether or not that
L is public, record is kind
of determined by when it's reported publicly and
my understanding just from reading the indictment
itself is that the previous owner, who
the one, who won. His indicted did
technically, I think use the funds for
the business. Yeah, even though he wasn't owning it anymore. Yeah,
he was still somewhat involved. Yeah, and I guess kind
of using it for the business and it wasn't that the
MCA providers weren't being repaid. It's just
That the companies I guess obligations became
too much and it wanted to bankruptcy. And when they were doing
a bankruptcy investigation as one, would you determine you
know, what happened here? It probably know. It's a probably cause
I don't know for sure. It probably turned out that they said, hey,
how did you even end up with these obligations to begin with, who
signed the paperwork for this? The previous owner? What
did the previous owners say? He claimed that is still owned it
when he did it. Yeah, and that would
be fraud, right? And so in the interest of
- I assume in a bankruptcy proceeding, it's someone
claimed to be the owner when they weren't, and that's part of the cause of the
bankruptcy. You probably have committed a crime. Those are the allegations
at this point. We'll see what happens. I
know a lot of people yesterday with just very, very interested in the headline to
see that someone who defrauded a merchant cash
advance company. Yeah. Was indicted for doing that.
Yeah. It's like, it's almost like a moment for everybody. Do
you think we'll ask you is? Do you think that officials
government officials?
Cetera that their their view on MCAS MCA
companies is changing. Oh, absolutely.
This question is being asked more
and more. You know, what do I think the future in the industry is and you know, you
know, will there be regulation? Is all going to end? I think what
we're seeing between headlines like that. Yeah, and
then also all the state bills
and disclosure laws were seeing. These are
all in acknowledgement that the industry itself is
legal. You have states trying to require a specific.
Disclosures. Yeah, because they're acknowledging. This
is here. Yeah, we want to make sure that customers
understand, you're not saying. Hey, let's make this whole thing
a legal, right? They want to make sure customers understand when
you have headlines. Like, Hey, we're going to, we've got somebody
indicted because they departed on say companies. They were acknowledging that
this product. The providers of this Capital are
genuine and and valid providers of
capital and then if you defraud them, yeah, you could end up
going to jail, right? So I think that. Yeah.
Yeah, Viewpoint from all sides is changing the courts and
a law enforcement, the legislators. They've
all kind of acknowledge this particular type of financing
is not going anywhere. And now how
do we move forward with it and do it in
an orderly way? Yeah.