LaPorte was arrested Aug. 7 on a weapons charge in Haverford, Pennsylvania, and is in federal custody awaiting a bail hearing Tuesday afternoon. Investigators had found seven loaded guns in his possession, a violation given his prior conviction of crimes punishable by prison terms of over one year. Michael Engle, LaForte’s lawyer, declined to comment.
“We’ve started suing some of them and I’m looking for a systemic solution that makes sure they can all be wiped out before they do more damage.”
The FBI official said its investigation into Par is ongoing. The federal judge overseeing the SEC case granted the agency’s request to appoint a receiver to run Par Funding.
In court filings, lawyers for Par Funding said that the company and its owners vigorously dispute the SEC’s allegations and that the company “uses best business practices and has a full-time compliance officer on staff.”
An Aug. 4 court filing by Par’s lawyers said it was pursuing 1,000 collection actions against borrowers it characterized as in default. The filing said the company was thriving before the COVID-19 pandemic hit, generating $104 million in retained earnings.
NBC News obtained a videotape of an investor pitch dinner in hosted by Dean Vagnozzi, head of an investment firm that raised money for Par and was sued by the SEC. On the video, in which Par executives also appear, Vagnozzi promises investors returns of between 10 percent and 14 percent, saying that the outsized returns were possible because merchant cash advance companies like Par charge interest rates of 35 percent and more.
Once they sent those, the vendors said, ‘Oh, gosh, this guy is in trouble,’ and they cut all my credit lines
Brian Miller https://signaturetitleloans.com/payday-loans-in/, a lawyer for Vagnozzi, said in a statement that the case against his client related to just one part of his business. “Based on all of the information Mr. Vagnozzi was provided by Par, the Par Funding business appears to be a legitimate business providing financing to small businesses, some of which are now experiencing financial difficulties in the middle of the pandemic and economic downturn.”
Even his personal bank account was frozen
“I fault myself because I didn’t do enough research” about Par, said Hoehn, the personal trainer who borrowed from Par, “but it’s totally inappropriate for them to harass me for receipts I’m not getting.”
“When COVID started we called them and said, ‘We are out of business,'” Hartig told NBC News. His company sells its products at fairs and festivals, he said, and “every one of them was shut down across the country.”
Par didn’t care, Hartig recalled. “They said, ‘We’re going to take your house, take your cars,'” he said. “They sent letters to my vendors that I do business with to make my products. “
Some merchants told NBC News they were forced to sell their businesses to get out from under their obligations to merchant cash advance companies.
One is Jim Cook, a social worker and founder of Antelope Valley Community Clinic, a nonprofit healthcare facility that serves over 100,000 people in Lancaster, California, many of them indigent.
In 2017, after the clinic fell behind on billing and payroll taxes, its chief financial officer borrowed around $1.2 million from several companies. One was a unit of RCG Advances, sued by the FTC and the New York attorney general in June.
“The lenders started putting liens on our bank accounts and our vendors,” Cook said in an interview. “We fought with them through 2018 until the board and I decided that we weren’t getting out of this on our own,” Cook added.