Merchant Cash Advance Debt Consolidation Fraud

Legal Help for Businesses Misled by MCA Debt Relief Companies

Over the past several years, a growing number of businesses struggling with merchant cash advance (“MCA”) obligations have been targeted by so-called “debt consolidation,” “debt relief,” or “MCA restructuring” companies that promise dramatic reductions in balances or protection from lenders.

Unfortunately, many of these companies collect substantial upfront fees while failing to meaningfully negotiate settlements, failing to communicate with lenders, or making representations about legal protection that they cannot lawfully provide.

J. Singer Law Group represents business owners who believe they were misled, overcharged, or harmed by MCA debt consolidation companies.

If you paid a company to resolve your MCA obligations and little or nothing was actually done to advance settlements, you may have legal claims.

Common Problems We See

Businesses often come to us after paying thousands, and sometimes tens of thousands, of dollars to debt consolidation companies that promised to negotiate their MCA obligations.

Common patterns include:

• Charging large upfront fees while performing little or no negotiation work
• Advising merchants to stop paying MCA companies, which can trigger defaults and lawsuits
• Claiming to have a “legal department” or “lawyer relationships” when no attorneys are involved
• Failing to communicate with lenders despite representing that negotiations are underway
• Collecting funds allegedly intended for settlements but never applying those funds to actual settlements
• Failing to disclose the risks of litigation, judgments, or bank restraints

In some cases, these practices can significantly worsen a merchant’s financial situation.

Potential Legal Claims

Depending on the facts of a particular situation, businesses may have claims such as:

• Fraud or fraudulent inducement
• Breach of contract
• Unjust enrichment
• Conversion or misuse of funds
• Deceptive or misleading business practices
• Unauthorized practice of law (in certain circumstances)

Each case is highly fact-specific, and our firm carefully evaluates the underlying agreements, communications, and payment history before advising clients on potential claims.

How These Situations Often Arise

Many MCA borrowers search online for help after facing multiple advances and aggressive collection activity. Debt consolidation companies frequently advertise services such as:

• "Reduce your MCA balances”
• “Stop lawsuits”
• “Consolidate all advances into one payment”
• “Legal restructuring services”

However, in many instances, these companies do not have the authority or legal ability to provide the services that are advertised, particularly when litigation is already underway.

When businesses rely on these representations and pay significant fees, serious financial harm can result.