1 00:00:00.800 --> 00:00:04.500 Sean went, when you hear about this. I mean it's 100,000 essentially 2 00:00:03.700 --> 00:00:07.900 almost 800,000 3 00:00:07.900 --> 00:00:10.400 dollars. Almost. What 4 00:00:10.400 --> 00:00:13.500 are your thoughts? Yeah. I think the number is meaningless, and 5 00:00:13.500 --> 00:00:16.600 the only meaningful part of his story is that the fact that somebody 6 00:00:16.600 --> 00:00:19.200 would actually indicted for departing a merchant cash advance companies. I 7 00:00:19.200 --> 00:00:22.500 think that's, that's the headline that grabs everyone's attention yesterday. I 8 00:00:22.500 --> 00:00:25.300 think that MCA companies, small 9 00:00:25.300 --> 00:00:29.200 business lenders, that aren't banks are so used to being defrauded without 10 00:00:28.200 --> 00:00:30.400 there being any 11 00:00:30.600 --> 00:00:33.700 It's to those who are trying to defraud them. They're exhausted 12 00:00:33.700 --> 00:00:36.300 by it. They're annoyed by it. There's nothing they 13 00:00:36.300 --> 00:00:39.100 can do about it. Whenever they complain to the authorities. They 14 00:00:39.100 --> 00:00:42.400 say it sounds like a civil matter. If you're really so bothered about 15 00:00:42.400 --> 00:00:45.600 it, won't you go and sue them? Don't bring it to us. That's 16 00:00:45.600 --> 00:00:48.500 the that's the response. They generally get. Now, 17 00:00:48.500 --> 00:00:51.200 when you defraud a bank you can do the smallest thing and like, 18 00:00:51.200 --> 00:00:54.400 hey, you know, you miss stated your income last year. 19 00:00:54.400 --> 00:00:57.200 That's 10 years in present you defer to the bank. Yeah. Now you 20 00:00:57.200 --> 00:01:00.400 send in fake bank statements, you forge all the 21 00:01:00.500 --> 00:01:03.700 Pants, you do fake references, you phony 22 00:01:03.700 --> 00:01:06.000 up to application to a small business lender. That's not a 23 00:01:06.600 --> 00:01:09.400 bank or an MCA provider. And they say, I 24 00:01:09.400 --> 00:01:12.700 think this is fraud and they're like, oh well, 25 00:01:12.700 --> 00:01:15.100 yeah, you got me. Yeah, what are you gonna 26 00:01:15.100 --> 00:01:18.100 do about it? Nothing happens? Because if you 27 00:01:18.100 --> 00:01:21.300 report that applicant to the feds, they just don't 28 00:01:21.300 --> 00:01:24.100 care. That's been the trend. So everyone just kind of down in 29 00:01:24.100 --> 00:01:27.300 the dumps because here they read stories about 30 00:01:27.300 --> 00:01:30.200 them in the news about how all the things that they're 31 00:01:30.200 --> 00:01:30.400 doing. 32 00:01:30.500 --> 00:01:33.300 - for small business there, you know being 33 00:01:33.300 --> 00:01:36.500 criticized constantly about this is too much. This 34 00:01:36.500 --> 00:01:39.500 is too slow. You know, Big Data, blah 35 00:01:39.500 --> 00:01:42.600 blah blah, blah blah, and they're like, we're being defrauded all day every day 36 00:01:42.900 --> 00:01:45.300 and what and we can't do anything about 37 00:01:45.300 --> 00:01:48.200 it and nobody cares. And so when you see a story that somebody with 38 00:01:48.200 --> 00:01:51.600 indicted for defrauding, one of these providers people 39 00:01:51.600 --> 00:01:54.400 are like, yeah, thank you 40 00:01:54.400 --> 00:01:57.700 for acknowledging. The fact that people are trying to defraud us, 41 00:01:57.700 --> 00:02:00.300 right. Yeah. I wish that, you know, they probably wish 42 00:02:00.300 --> 00:02:00.400 that 43 00:02:00.500 --> 00:02:03.500 that everyone who's trying that would also get indicted you'd 44 00:02:03.500 --> 00:02:06.800 have probably a million people in prison. Yeah, people 45 00:02:06.800 --> 00:02:09.100 know not to defraud the bank because if you do, you 46 00:02:09.100 --> 00:02:12.300 get 10 years in jail, so they go to the other online lenders say I'm 47 00:02:12.300 --> 00:02:15.300 going to defraud that guy because nothing will happen to me. Yeah, it's 48 00:02:15.300 --> 00:02:18.400 a bad precedent that's been set. Hopefully stories like this 49 00:02:18.600 --> 00:02:21.500 change, the mindset of people saying, just because it's some online 50 00:02:21.500 --> 00:02:24.200 company or a small business finance company that, you 51 00:02:24.200 --> 00:02:27.300 know, only through phone and email that if you commit fraud, you 52 00:02:27.300 --> 00:02:30.400 can end up in prison. Now granted, this person has only been indicted. 53 00:02:30.500 --> 00:02:33.100 Have been convicted of anything. So at this point is 54 00:02:33.100 --> 00:02:36.600 only allegations, but the doj was 55 00:02:36.600 --> 00:02:39.100 very specific about what happened. I mean, in hide would 56 00:02:39.100 --> 00:02:42.300 happen that the headline by the doj was 57 00:02:42.300 --> 00:02:45.700 that this person de frauded merchant, cash 58 00:02:45.700 --> 00:02:48.300 advance companies. That's a headline. You think you'd 59 00:02:48.300 --> 00:02:52.000 never see, like, we got them. He defrauded them. See, a company's this 60 00:02:51.600 --> 00:02:55.200 person is now under indictment. That's 61 00:02:54.200 --> 00:02:57.900 the major, the major thing about 62 00:02:57.900 --> 00:03:00.300 this new story. That's why it's so relevant. It's not 63 00:03:00.400 --> 00:03:03.400 it's not necessarily a dollar amount. It's possible that it was more 64 00:03:03.400 --> 00:03:06.100 but they only got them on these particular things. Yeah, you know, I don't 65 00:03:06.100 --> 00:03:09.200 know, all the individual details, but you did, you 66 00:03:09.200 --> 00:03:12.300 did raise an interesting fact of, you know, how did he do it? 67 00:03:12.400 --> 00:03:15.100 And there's only, there's only so much you can do 68 00:03:15.100 --> 00:03:18.900 in underwriting to verify. Yeah. Someone's 69 00:03:18.900 --> 00:03:21.100 ownership in the business, right? Yeah, and 70 00:03:21.100 --> 00:03:24.300 if you owned it today, but you sold it tomorrow and 71 00:03:24.300 --> 00:03:27.200 you apply for financing. The next day. They 72 00:03:27.200 --> 00:03:30.300 might not know that you've sold it. Yeah, because whether or not that 73 00:03:30.500 --> 00:03:33.300 L is public, record is kind 74 00:03:33.300 --> 00:03:37.200 of determined by when it's reported publicly and 75 00:03:36.200 --> 00:03:39.500 my understanding just from reading the indictment 76 00:03:39.500 --> 00:03:42.700 itself is that the previous owner, who 77 00:03:42.700 --> 00:03:45.600 the one, who won. His indicted did 78 00:03:45.800 --> 00:03:48.400 technically, I think use the funds for 79 00:03:48.400 --> 00:03:51.700 the business. Yeah, even though he wasn't owning it anymore. Yeah, 80 00:03:51.700 --> 00:03:54.600 he was still somewhat involved. Yeah, and I guess kind 81 00:03:54.600 --> 00:03:58.000 of using it for the business and it wasn't that the 82 00:03:57.400 --> 00:04:00.300 MCA providers weren't being repaid. It's just 83 00:04:00.400 --> 00:04:03.300 That the companies I guess obligations became 84 00:04:03.300 --> 00:04:06.300 too much and it wanted to bankruptcy. And when they were doing 85 00:04:06.300 --> 00:04:09.100 a bankruptcy investigation as one, would you determine you 86 00:04:09.100 --> 00:04:12.200 know, what happened here? It probably know. It's a probably cause 87 00:04:12.200 --> 00:04:15.200 I don't know for sure. It probably turned out that they said, hey, 88 00:04:15.200 --> 00:04:18.500 how did you even end up with these obligations to begin with, who 89 00:04:18.500 --> 00:04:21.600 signed the paperwork for this? The previous owner? What 90 00:04:21.600 --> 00:04:24.300 did the previous owners say? He claimed that is still owned it 91 00:04:24.800 --> 00:04:27.200 when he did it. Yeah, and that would 92 00:04:27.200 --> 00:04:30.300 be fraud, right? And so in the interest of 93 00:04:30.500 --> 00:04:33.300 - I assume in a bankruptcy proceeding, it's someone 94 00:04:33.300 --> 00:04:36.100 claimed to be the owner when they weren't, and that's part of the cause of the 95 00:04:36.100 --> 00:04:39.600 bankruptcy. You probably have committed a crime. Those are the allegations 96 00:04:39.600 --> 00:04:42.200 at this point. We'll see what happens. I 97 00:04:42.200 --> 00:04:45.900 know a lot of people yesterday with just very, very interested in the headline to 98 00:04:45.900 --> 00:04:48.500 see that someone who defrauded a merchant cash 99 00:04:48.500 --> 00:04:51.400 advance company. Yeah. Was indicted for doing that. 100 00:04:51.500 --> 00:04:54.800 Yeah. It's like, it's almost like a moment for everybody. Do 101 00:04:54.800 --> 00:04:58.700 you think we'll ask you is? Do you think that officials 102 00:04:57.300 --> 00:04:59.900 government officials? 103 00:05:00.400 --> 00:05:03.900 Cetera that their their view on MCAS MCA 104 00:05:03.900 --> 00:05:06.900 companies is changing. Oh, absolutely. 105 00:05:06.200 --> 00:05:09.100 This question is being asked more 106 00:05:09.100 --> 00:05:12.600 and more. You know, what do I think the future in the industry is and you know, you 107 00:05:12.600 --> 00:05:15.400 know, will there be regulation? Is all going to end? I think what 108 00:05:15.400 --> 00:05:18.400 we're seeing between headlines like that. Yeah, and 109 00:05:18.400 --> 00:05:21.600 then also all the state bills 110 00:05:21.600 --> 00:05:24.100 and disclosure laws were seeing. These are 111 00:05:24.100 --> 00:05:27.300 all in acknowledgement that the industry itself is 112 00:05:27.300 --> 00:05:30.300 legal. You have states trying to require a specific. 113 00:05:30.500 --> 00:05:33.600 Disclosures. Yeah, because they're acknowledging. This 114 00:05:33.600 --> 00:05:36.700 is here. Yeah, we want to make sure that customers 115 00:05:36.700 --> 00:05:39.200 understand, you're not saying. Hey, let's make this whole thing 116 00:05:39.200 --> 00:05:42.500 a legal, right? They want to make sure customers understand when 117 00:05:42.500 --> 00:05:45.300 you have headlines. Like, Hey, we're going to, we've got somebody 118 00:05:45.300 --> 00:05:48.600 indicted because they departed on say companies. They were acknowledging that 119 00:05:48.600 --> 00:05:52.000 this product. The providers of this Capital are 120 00:05:51.300 --> 00:05:54.200 genuine and and valid providers of 121 00:05:54.200 --> 00:05:57.100 capital and then if you defraud them, yeah, you could end up 122 00:05:57.100 --> 00:06:00.200 going to jail, right? So I think that. Yeah. 123 00:06:00.400 --> 00:06:04.300 Yeah, Viewpoint from all sides is changing the courts and 124 00:06:04.300 --> 00:06:07.200 a law enforcement, the legislators. They've 125 00:06:07.200 --> 00:06:10.700 all kind of acknowledge this particular type of financing 126 00:06:10.900 --> 00:06:13.700 is not going anywhere. And now how 127 00:06:13.700 --> 00:06:16.100 do we move forward with it and do it in 128 00:06:16.100 --> 00:06:17.400 an orderly way? Yeah.