They deceived consumers by misrepresenting the terms of their financing products. On their website, they claim that their financing products require “no personal guaranty of collateral from business owners” and “no upfront costs
In fact, the defendants’ financing agreements include “personal guaranty” that consumers must agree to and they withhold different fees upfront before disbursing the funding to consumers. They also require consumers to sign a confession of judgment as part of their financing agreements. The confession allowed the defendants to go immediately to court and obtain an uncontested judgment in case of an apparent default.
Additionally, the FTC alleged that the defendants “made threatening collection calls to consumers, frequently using obscene or profane language” to compel them to continue making payments.
According to the Commission, the defendants violated the FTC Act, which prohibits “unfair or deceptive acts or practices in or affecting commerce.” Their unlawful unfair and deceptive business practices caused and will continue to cause suffering to consumers. They also obtained and will continue to reap unjust profits and harm the public interest.
