Par Funding began its operations in 2012 when the Merchant Cash Advance business was not yet mainstream.
The foundation of this business is such that a company like Par Funding can give a merchant cash advance to various types of business, from your typical mom and pop shop, to much bigger businesses who need working capital. This service was available to businesses who needed quick access to capital to help them succeed over the years. The cornerstone of such a merchant cash advance business is that the business receiving the advance would agree to provide a percentage of sales, in return for commercial factoring.
Small businesses are the lifeblood of America, and Par Funding helped provide them with the necessary capital they required to succeed. Par Funding developed a relationship with the people that ran these businesses, as they weren’t just one time clients. They kept coming back because they knew they could lean on Par Funding in difficult times, and Par Funding was always there for them to provide a helping hand.
The banking industry is heavily regulated, with stringent requirements set in place. Par Funding made sure to prioritize compliance and used many legal experts to put together the proper documents required for this business. From hiring CPAs, a compliance officer, and attorneys, everything was done to ensure proper regulatory compliance from Par Funding’s end.
Since 2012 Par Funding has helped many businesses thrive, as they funded about 16,000 in commercial factoring in 8 years. They made sure to provide accredited investors with the proper disclosure agreements. Par Funding provided their investors with in-depth analysis and never missed a single payment until a moratorium was put in a place by the SEC.
Par Funding received a sealed complaint from the SEC alleging that Par Funding engaged in a business of making “opportunistic” loans to small business owners across America and that they have funded these loans through a “web of unregistered, fraudulent securities offerings.”
Par Funding contends that it was never given its due process as the court immediately assigned a receiver just one day later after filing the complaint.
The receiver terminated all of Par Funding’s expert employees, and corporate counsel, and hired DSI to take over the daily operations.
There have been numerous high court rulings that have held that appointing a receiver before due process is given to the defendant can be seen as an extraordinary measure taken by the prosecution. It seems that this is exactly what happen to Par Funding, as they were unable to continue to run their business, and the actions of the receiver make it seem like a verdict had already been issued, before due process could take its course.
They assert that there was no specific reason as to why the complaint was issued, nor why it was a sealed complaint. Par Funding was put under an intensive process which they argue was one-sided. The 1.5 million that Par Funding had collected in daily accounts receivable was put on hold for up to 8 weeks, and they could not use these funds to provide funding to businesses in need.
This whole process has unfolded mysteriously, and Par Funding still contends they have no answers as to why they received a sealed complaint.
Par Funding is still in the litigation process in hopes to get investors their money back, so they can continue to help thousands of small businesses grow their operations.
(Syndicated press content is neither written, edited or endorsed by ED Times)
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