7 MCA Companies That Have Faced State or Federal Enforcement Actions

What an Enforcement Record Is Worth in Your File

There is a version of this page that would be easier to write and useless to you, where every funder is a criminal and every filing is proof. The record is narrower than that and more useful. A handful of named companies were sued by regulators, most of them signed consent orders that expressly deny wrongdoing, two lost on the merits in court, and several were ordered to vacate judgments they had already taken and release liens they had already filed. Each of those facts carries different weight when your attorney picks up the phone.

So the rule below, and the rule you should apply to anything you read about your own funder, is that an allegation in a complaint stays an allegation until a court says otherwise or the company agrees to a remedy. Where a regulator alleged 820% annualized rates, we say the regulator alleged it. Where the Appellate Division held that agreements styled as advances were properly characterized as loans, we say the court held it. The practical question is never whether these are bad people. It is whether the order in their file gives your lawyer a lever, and whether the paper the regulator attacked is the paper in your drawer. Our page on the clauses that decide your leverage walks that paper line by line.

1. Yellowstone Capital and the Fundry Network

The New York Attorney General filed People v. Yellowstone Capital LLC in Supreme Court, New York County under Index No. 450750/2024 on March 5, 2024, pleading claims under Executive Law §63(12). A consent order and judgment was entered with the county clerk on January 16, 2025, and the office announced it on January 22, 2025. The announced terms: a $1.065 billion judgment, $534,552,724 in canceled balances, $16.1 million in immediate restitution with another $30 million owed on noncompliance, more than 1,100 New York businesses and more than 18,000 nationwide, and a permanent ban from the industry. The 820% annual rate figure is the Attorney General’s allegation. The ban and the cancellations are agreed terms.

The Federal Trade Commission got there first, on a different theory. FTC v. Yellowstone Capital LLC, No. 1:20-cv-06023 (S.D.N.Y.), was filed August 3, 2020 against Yellowstone Capital, Fundry LLC, Yithak D. Stern known as Isaac Stern, and Jeffrey Reece. The agency alleged the defendants kept pulling money from business accounts for days after a balance had been repaid, misled owners about how much funding would actually land, and misled them about pledged collateral and personal guarantees. The stipulated order was filed April 21, 2021: $9,837,000 surrendered, a permanent bar on misrepresenting fees and personal liability, and no withdrawals without express informed consent. In June 2022 the FTC said it had mailed 7,731 refund checks totaling more than $9.7 million.

New Jersey ran a third case on a third statute. The complaint was filed December 8, 2020 in Superior Court, Hudson County, Chancery Division, Docket No. HUD-C-180-20, naming Yellowstone, Fundry and affiliates including High Speed Capital, World Global Capital doing business as YES Funding, HFH Merchant Services, Green Capital Funding, MCA Recovery and Max Recovery Group. The claims arose under the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 to -227, and the advertising rules at N.J.A.C. 13:45A-9.1 to -9.8. Motions to dismiss were denied on or about April 19, 2021. The consent order announced January 3, 2023 totals roughly $27,375,000, about $21,750,000 of it in forgiven customer balances under N.J.S.A. 56:8-8 plus $5,625,000 to the Division of Consumer Affairs. The order states that the respondents denied the allegations and admitted no fact and no violation of law.

The half of that New Jersey order nobody quotes is the conduct half, and it reads like a template you can borrow. The respondents agreed to stop filing confessions of judgment against any customer, to dismiss pending cases with prejudice or file satisfactions of judgment for forgiven balances, and to file UCC-3 terminations reflecting the forgiveness. They agreed that reconciliation requests would not be confined to a five-day window at the start of the month, that the look-back would cover the entire life of the transaction, and that a reconciliation could never come back as an amount owed to them. They also agreed that while a documented reconciliation request is pending, payments will not be debited and complaints will not be filed.

2. RCG Advances, Formerly Richmond Capital Group

The FTC sued on June 10, 2020 in FTC v. RCG Advances, LLC, No. 1:20-cv-04432 (S.D.N.Y.), naming RCG Advances, LLC, formerly Richmond Capital Group, LLC and also doing business as Viceroy Capital Funding and Ram Capital Funding, plus Ram Capital Funding LLC, Robert L. Giardina, Jonathan Braun and Tzvi Reich. An amended complaint seeking civil penalties followed on June 14, 2021. The agency alleged that since at least 2015 the defendants misrepresented advance terms, made unauthorized withdrawals, used unfair collection practices including threats of physical violence, and weaponized confessions of judgment to seize personal and business assets in circumstances the contracts did not permit. Those allegations arose under the FTC Act and the Gramm-Leach-Bliley Act.

The stipulated order announced June 6, 2022 permanently banned RCG Advances and Giardina from business financing and debt collection, required more than $2.7 million in refunds, and ordered them to vacate judgments against former customers and release liens on customer property. Braun did not settle. The court issued an opinion and permanent injunction against him on October 30, 2023, a jury heard the case in January 2024 in what the FTC called its first jury trial, and on February 14, 2024 the court entered final judgment of $20.3 million, made up of $3,421,067 in redress and $16,956,000 in civil penalties for knowing Gramm-Leach-Bliley violations. That one is a finding, not a settlement.

New York ran its own proceeding, and its appellate history is the most misreported fact in this industry. Supreme Court, New York County granted the Attorney General a summary determination under Executive Law §63(12) by order entered on or about September 15, 2023, and Justice Andrew Borrok entered judgment on April 11, 2024 against respondents jointly and severally for $77,289,631 plus interest, roughly $77.3 million. On February 19, 2026 the Appellate Division, First Department, in People v. Richmond Capital Group LLC, 2026 NY Slip Op 00990, unanimously modified on the law to vacate the monetary aspect of that judgment and remand, otherwise affirming without costs. Liability survived; the dollar figure did not, because the People never backed repayments of principal out of their damages calculation, disgorgement was unavailable, and offsets still have to be weighed.

What the court said about the paper is worth more to you than the number. It described respondents as having funded over 3,000 transactions styled as advances, and held the agreements were properly characterized as loans subject to usury limits. The reconciliation provisions were mandatory on their face but no reconciliation was performed in practice; the daily payments were fixed and were not a good faith estimate of receivables; discretionary reconciliation sat in the funder’s sole discretion and requests were denied; bankruptcy was an express default in some agreements while repeated nonpayment or interrupting, suspending, dissolving or terminating the business served that role in others. The court also found the agreements unconscionable, and found repeated fraud based on misstatements to merchants and to courts in judgment affidavits.

3. Ram Capital Funding and Tzvi Reich

Ram Capital settled with the FTC first, by order filed January 5, 2022. RAM Capital Funding, LLC and its owner Tzvi Reich were permanently banned from the merchant cash advance and debt collection industries and required to pay $675,000. The order also required them to vacate any judgments against former customers, release any liens against customer property, and cooperate with the FTC against the remaining defendants. The underlying allegations, which no court adjudicated, were that since 2015 the defendants demanded personal guarantees and upfront fees after representing they would not, funded less than promised, debited more than disclosed, made unauthorized withdrawals, threatened violence, and used confessions of judgment to obtain uncontested judgments.

The New York proceeding produced an actual holding about the thing brokers say when they get sued. The First Department affirmed joint and several liability against Ram Capital Funding LLC and Reich because they participated in a common enterprise with the other respondents. Reich argued he had merely been a broker. The court pointed to the record and to his own admissions showing he was at times involved in funding, servicing and collecting on the advances, and that he shared office space with the other respondents in connection with advances Ram originated. If the entity that solicited you also touched underwriting, servicing or collections, the broker label is not a wall.

Private litigation runs in parallel and sometimes arrives before a regulator does. In Fleetwood Servs., LLC v. Richmond Capital Group LLC, No. 22-1885-cv, the Second Circuit affirmed on June 8, 2023, and the First Department cited that decision when it held these agreements were loans. Practically, a funder ordered to release liens and vacate judgments carries a compliance obligation that runs to your file whether anyone has told you or not. Pull your state’s UCC index and the county clerk’s judgment docket under both your entity name and your own name, because nobody at the funder volunteers that a 2022 order covers you.

4. Delta Bridge Funding and Cloudfund

The Attorney General’s March 5, 2024 complaint did not stop at Yellowstone. It alleged that Yellowstone ceased operations in 2021 while facing investigations and then rebranded as Delta Bridge Funding, also known as Cloudfund, continuing the same business with the same personnel who had supervised and operated the earlier scheme. The complaint described more than thirty companies operating under aliases including Fundry, Green Capital Funding, High Speed Capital and Capital Advance Services, alleged annualized rates up to 820%, and sought at least $1.4 billion in restitution plus a lifetime industry ban for Yellowstone co-founder David Glass. One example the office gave was a New York bakery paying more than $2,000 a day.

Read that as a pleading, because that is all it is. Those are the Attorney General’s allegations, and the office’s January 22, 2025 announcement of the $1.065 billion judgment does NOT resolve the claims against them: it describes twenty-five companies permanently barred from the industry and states that the office will continue its lawsuit against Delta Bridge Funding and Cloudfund, the companies it says took over Yellowstone’s operations in 2021, along with eight other individuals including co-founder David Glass. No court made findings about who did what inside that network, and the consent posture means none will. What survives is the shape of the theory: continuity of people and continuity of business can tie a new name to an old record.

For you this is the alias problem, and it turns up constantly in files that have been open two years. The entity on your agreement, the entity taking the daily debit, the secured party named on the UCC-1, and the plaintiff that eventually appears on a summons are frequently four different names. Write all four down. Then confirm which one has standing to sue you and which one holds the perfected security interest, because a company can rebrand, sell a book, or dissolve without any of that showing up in your bank feed.

5. Rapid Ruling, the Forum Built for the Industry

This one is not a funder, which is exactly why it belongs here. On June 8, 2026 the New York Attorney General announced a special proceeding against Mediation and Civil Arbitration, Inc., doing business as Rapid Ruling, and its founders, New York attorneys Zachary Meyer and Andrew Sachs. The verified petition was filed in Supreme Court, New York County under Index No. 452192/2026 and received on the electronic docket June 9, 2026. It pleads repeated and persistent fraud, deception, illegality and abusiveness under Executive Law §63(12) and General Business Law §349, including the abusive-practices provision at §349-a, which the petition says took effect February 17, 2026. Pre-litigation notice was given under GBL §349(c).

The allegations are specific and dated. The corporation was organized under New York law on September 27, 2019. The petition alleges the forum was conceived with a non-party merchant cash advance company, LCF Group, Inc., formerly Last Chance Funding, whose in-house attorney sent draft arbitration rules to Meyer on August 6, 2019, less than a month before the C.P.L.R. §3218 amendments took effect on August 30, 2019 and barred filing confessions of judgment in New York courts against non-New York residents. It alleges that 97% of roughly 3,000 arbitrations in the platform’s first three years proceeded with no appearance by any small business, that arbitrators were paid a flat $50 to $75 per uncontested case, and that at least fifteen uncontested awards issued after February 17, 2026.

The mechanism described should change how you read your own contract. An award is not the end of it. The funder then files a petition to confirm, and the petition explains why that route is attractive: confirmation runs as a special proceeding, faster than a plenary action, and New York courts give arbitrators substantial deference. Confirmation produces a money judgment, and a money judgment produces a restraining notice on your account. The exhibit list includes awards issued to AKF Inc. doing business as FundKite, to Merk Funding Inc., and to Alpine Advance 5 LLC. Those companies are not respondents, and the claims of wrongdoing run against Rapid Ruling and its founders. Nothing has been decided; the figures above are pleaded, not found.

6. Expansion Capital Group and California’s Regulator

Not every enforcement action is a fraud case, and the quiet ones sometimes reach further into your contract. California’s Department of Financial Protection and Innovation entered a consent order with Expansion Capital Group, LLC in April 2022 under CFL File No. 60DBO-44063. Expansion is a Delaware limited liability company with its principal place of business in Sioux Falls, South Dakota, licensed as a lender under the California Financing Law, Cal. Fin. Code §22000 et seq., since April 24, 2015. The Department opened its investigation in 2019, examining the company’s marketing and what the order calls its purported non-loan financing products.

The Commissioner’s findings, which the company neither admitted nor denied, are unusually plain about how these agreements operate. Expansion used a Future Receivable Sales Agreement to buy shares of future revenue without recourse, taking a daily or weekly payment calculated as the equivalent, or a good-faith approximation, of the purchased percentage of receivables. The same agreement provided that a business was in default if, on at least five occasions, there were insufficient funds in the designated account. The Commissioner also found Expansion paid brokers and independent sales organizations that were not licensed as the law required, and changed officers and directors in 2017 without amending its license application within thirty days.

What was ordered matters because it reached the contract itself. Under Fin. Code §22712, Expansion was ordered to desist and refrain from violating 10 C.C.R. §1451(c), which bars paying an unlicensed company for soliciting loan applications, and 10 C.C.R. §1422(c), the thirty-day amendment rule. It paid a $167,500 penalty. And in paragraph 4 it agreed to remove multiple NSFs as a trigger for default, to put controls in place designed to keep its advances from operating as non-compliant loans, to keep reaching out to customers about reconciliation options, and to train employees on those controls. A licensing regulator reached a default clause without ever litigating usury.

7. Complete Business Solutions Group, Doing Business as Par Funding

The seventh record answers a question we field most weeks: what happens when the funder itself collapses. The Securities and Exchange Commission filed suit against Complete Business Solutions Group, Inc., doing business as Par Funding, along with Full Spectrum Processing, Inc. and other defendants, in the Southern District of Florida on July 24, 2020, No. 9:20-cv-81205, before Judge Rodolfo A. Ruiz II. Note who the plaintiff is. This is a securities enforcement action, so the protected class is the investors who bought paper from the operation, not the merchants who took advances from it. Nothing in that case adjudicates your advance.

The docket is where the useful part lives. It shows a court-appointed receiver, Ryan K. Stumphauzer, running a claims process under the court’s supervision, with a receiver’s status report on that process entered November 27, 2023 and a joint status report from the Commission and the receiver entered March 21, 2024. The funding book became a receivership asset, years after the case was filed, and stayed one. Merchants who owed money to that operation did not stop owing it. They found themselves dealing with a fiduciary answerable to a federal judge instead of a collections desk.

That changes tactics in three concrete ways. Settlement authority runs through court approval, so the person on the call often cannot say yes, and a discount a funder’s in-house counsel would sign in a week can take a month or more. A receiver has an incentive to document rather than to intimidate, which removes the pressure tactics and also removes the urgency you were counting on. And the file may be incomplete, because a receiver who cannot produce the executed agreement, the payment history and the assignment chain has a proof problem. Ask for all three in writing before you discuss a number.

The Same Four Problems Show Up in Every One of These Files

Read the seven records back to back and the overlap is hard to miss. Reconciliation exists on paper and not in practice, which is the finding the First Department rested on and the practice the New Jersey and California orders were written to reform. Default fires on mechanics rather than on money, so a few returned debits or a temporary closure accelerates a balance nobody actually missed. Personal guarantees and confessions of judgment convert a company obligation into a claim against a house. And the enforcement route keeps migrating toward whatever forum is fastest, from confessions of judgment before August 2019 to private arbitration after it.

Each of those four is a place where your file either has a defect or does not, and the answer is knowable in about an hour of reading. If reconciliation was requested and refused, the refusal is evidence. If a returned-debit clause fired while your deposits were healthy, the default itself is contestable. If the guaranty was signed by someone who was not an owner, or the confession affidavit named the wrong county, those are procedural problems with real consequences. And where a lien still sits against your assets after a consent order canceled the balance, that is not a negotiation at all: see what a UCC lien can and cannot do to your bank account.

Who Should You Call? Our Top-Rated Business Debt Firms

One firm on this list works the entire lifecycle of a business debt file, from stopping the daily debits through attorney-led negotiation, UCC lien removal, and a signed release. The other two cover broader debt categories that often sit alongside the advances. Choose accordingly.