Legal Briefs

Deloitte Sued Over Audits of Failed DLI Fund

May 7, 2020
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Those affected by the failure of Direct Lending Investments (DLI) have added a new target to blame, Deloitte & Touche LLP and related entities. A lawsuit filed last week in the Superior Court of California says that Deloitte was engaged by DLI to audit the Funds’ financial statements and accompanying footnotes in accordance with GAAP […]

New York Supreme Court Grinds to a Halt

March 24, 2020
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Amid the Coronavirus pandemic, the New York Unified Court System has modified its protocols. Among the limitations, the Supreme Court will only be handling “essential applications as the court may allow.” Examples offered were Mental Hygiene Law Applications, civil commitments, and guardianships. All other matters and conferences are being adjourned to future dates. These temporary […]

Thanks to the Virus Craze: It May Now Be Unlawful For Telemarketers Doing Business in New York To Call Large Swaths Of The Country

March 10, 2020
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Are you a telemarketer that does business in New York? A large and growing percentage of the country may now be off-limits to contact, thanks to a recently enacted New York State law that prohibits unsolicited telemarketing sales calls to any person in a county, city, town or village under a declared state of emergency […]

Income Share Agreements – Operating Under Current Regulations and Preparing for the Future

February 28, 2020
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The Income Share Agreement (“ISA”) market is rapidly developing with more providers offering ISA programs to students and outside money moving into the space. However, the legal environment remains uncertain, and providers entering the ISA market must prepare themselves both to operate in the current environment and for potential changes. Background – What is an […]

New York Appellate Court Overturns QFC, LLC v Iron Centurian, LLC

February 7, 2020
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Courtroom

The Appellate Division, 2nd Department of The Supreme Court of New York, overturned QFC, LLC v Iron Centurian, LLC and Mohamed Sadiqui last month, granting victory to a merchant cash advance company. The case can be summed up as follows: A Confession of Judgment (COJ) was filed by plaintiff against defendants for breach of contract. […]

Lender Ranking Website Accused By FTC Of Misleading Rankings

February 6, 2020
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United States Federal Trade Commission

LendEDU, a Hoboken-based company that lists and ranks loan providers, came under fire this week after the FTC filed a complaint detailing how LendEDU charged businesses for higher positions in its rankings of lenders and promoted fake testimonials. Providing ratings for student loan refinancing, personal loans, and mortgage lenders, it is the first of these […]

Appellate Court Affirms Decision in Merchant Funding Services, LLC v Micromanos Corporation etc.

February 1, 2020
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court ruling

On January 29th, 2020 the Appellate Division, 2nd Department, of the Supreme Court of New York, upheld the original decision issued in Merchant Funding Services, LLC v Micromanos, etc. et al.. The case concerns a Confession of Judgment (COJ) filed following Micromanos’ default on a merchant cash advance contract. The defendants sought to vacate the […]

One Of The Most Devastating Court Decisions Against Merchant Cash Advances Has Been Overturned

January 29, 2020
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gavel

Merchant Cash Advances have sat on comfortable legal footing in New York ever since an appellate court ruled in favor of Pearl Beta Funding, LLC against Champion Auto Sales, LLC in 2018, but even so, it hasn’t stopped lawyers from trying to invalidate merchant cash advance (MCA) contracts on behalf of aggrieved customers. That’s because […]

Former 1 Global Capital CFO Alan Heide Sentenced to 5 Years in Prison

January 17, 2020
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arrest handcuffs

Alan Heide, the former CFO of defunct Hallandale Beach-based 1 Global Capital, was sentenced to 5 years in prison earlier this week for his role in the company’s securities fraud. He is one of three individuals that have pled guilty so far and the first to be sentenced. The other individuals, attorney Jan Douglas Atlas […]

SEC, US Attorney Charge Steven A. Schwartz in 1 Global Capital Case

January 6, 2020
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handcuffs and money

New criminal and civil charges have been filed against an individual in the 1 Global Capital case. This time it’s Steven A. Schwartz, who served as 1 Global’s Director and Chief Operating Officer. The SEC alleges that Schwartz aided and abetted former CEO Carl Ruderman in carrying out a securities fraud. The US Attorney for […]

Sentencings in 1 Global Capital Criminal Cases Delayed

December 18, 2019
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arrest handcuffs

The sentencing dates for the two individuals that pled guilty for their part in the the 1 Global Capital mess, have been delayed. Jan Douglas Atlas’s sentencing has been pushed back until March 2020 with a date to be determined, while Alan Heide’s has been rescheduled to Jan 14, 2020.

More Individuals Expected to Be Criminally Charged in 1 Global Capital Case

November 30, 2019
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Hallandale Beach

Federal prosecutors have asked a Court to consolidate criminal cases against 1 Global Capital defendants Alan Heide and Jan D. Atlas on the basis that there is substantial overlap between them and that additional individuals are expected to be charged. “Considerable judicial resources may be conserved if, going forward, a single judge is chosen to […]

OCC Believes It’s Time To Fix Madden Issue Once And For All

November 18, 2019
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OCC Seal

If a bank makes a legal loan to a consumer and then later sells the debt to a third party, the terms of the loan are still legal right? “Yes” should be the obvious answer, but in 2015 a federal appeals court said “no.” The case was Madden v. Midland Funding LLC, which started as […]

Direct Lending Investments’ Ability to Collect From Largest Debtor Looks Uncertain

October 30, 2019
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satellite dish

When Direct Lending Investments (DLI), one of the largest online lending hedge funds, went bust, many were surprised to learn that the fund had discreetly gambled heavily in the international telecom market. At present, a company called VOIP Guardian Partners I owes DLI $203 million. There’s a problem with recovery in that VOIP declared Chapter […]

Attorney Pleads Guilty In 1 Global Capital Securities Fraud Mess

October 25, 2019
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arrest handcuffs

Jan Douglas Atlas, a Florida attorney that was arrested last month for his role in the 1 Global Capital debacle, entered a plea of guilty on Wednesday to 1 count of securities fraud. 74-year-old Atlas also agreed to be disbarred. The charges stem from his willingness to sign an opinion letter that claimed investment opportunities […]

Federal Judge Rules New York’s “Win” Against OCC’s Fintech Charter Nullifies The Fintech Charter Concept Entirely

October 21, 2019
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OCC Seal

The Office of the Comptroller of The Currency took a gamble with a federal judge in a lawsuit brought by the New York Department of Financial Services (DFS) and lost. On Monday, Judge Victor Marrero ruled that the OCC must “set aside” its special purpose (fintech) national bank charters entirely, not just for those with […]

New York Attorney General Secures Judgment Against Cardis Enterprises International

October 11, 2019
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AG-NY

New York Attorney General Letitia James announced today that she had secured default judgments against numerous entities and individuals involved in a $30 million fraud. In December 2018, the New York Attorney General’s Office filed suit against Cardis and company personnel Aaron Fischman, Stephen Brown, Steven Hoffman, and Seth Rosenblatt for participating in the fraudulent […]

Subprime: Business Owners That Won Bitter Lawsuit Against Marcus Lemonis, Indicted

September 25, 2019
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hamburgers

A pair of business owners whose appearance on CNBC’s The Profit ended in a legal battle with celebrity investor Marcus Lemonis, are back in the spotlight. Howard Mora and Alan Buxbaum, co-owners of defunct New York-based A. Stein Meat Products, Inc., were arrested Tuesday for using counterfeit USDA Stamps on their meat. A Septemer 13th […]

Head of MyPayrollHR Charged in Massive Nine-Year Bank Fraud

September 23, 2019
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DOJ

When MyPayrollHR left thousands of companies and their employees high and dry without their paychecks earlier this month, suspicion grew that the company’s rather mysterious owner, Michael Mann, may have been involved in some unsavory business. New information has emerged that around that time, Mann voluntarily checked in to the US Attorney’s office in Albany […]

Gone with the Wind: $35 Million Missing as Payroll Company Closes and President’s Home Raided

September 18, 2019
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Knocking on the door of a lake-view house in Edinburg, NY last week, reporters from both the Times Union and Daily Mail were met with pleas from a woman to leave her property and notice that she would call 911 if they continued. This week the FBI come knocking instead. The woman is assumed to […]