Best Companies to Help When an MCA Lender Sends Restraint Letters to Your Customers — 2026

Top Companies to Stop Restraint Letters to Your Customers — 2026

When an MCA lender bypasses your bank account and goes after your customers directly, the damage is not just financial — it is reputational. Customers who receive legal notices from a creditor claiming your receivables will question your stability, your reliability, and whether they should continue doing business with you. The firms below are ranked by their ability to stop restraining notices to customers specifically, including vacating the underlying judgment, challenging the scope of enforcement, and settling the MCA debt to prevent recurrence.

How MCA Lenders Use CPLR §5222 Restraining Notices Against Your Customers

Understanding the legal mechanics of customer-directed restraining notices is essential to fighting them. MCA lenders do not randomly send threatening letters — they use a specific legal process under New York’s Civil Practice Law and Rules to intercept your receivables at the source.

Step 1: The Confession of Judgment. When you signed the MCA agreement, you signed a confession of judgment (COJ) that allows the lender to obtain a court judgment without filing a lawsuit or providing you notice. The lender files this with a New York county clerk and obtains a judgment — often for the full remaining balance plus fees.

Step 2: Discovery of Your Customers. The MCA lender already knows your customers. How? Because the MCA agreement typically requires you to disclose your accounts receivable, and many MCA contracts include a clause granting the funder a security interest in your receivables under UCC Article 9. And the lender may have been monitoring your bank account through daily ACH access and can identify recurring incoming payments from specific customers.

Step 3: Serving the Restraining Notice. With a judgment in hand and your customer list identified, the lender’s attorney serves a CPLR §5222 restraining notice on each customer. The notice states that the customer is legally prohibited from paying you any money and must instead hold the funds or pay them to the judgment creditor. Your customers — who are likely not represented by counsel in this matter — receive what appears to be a legal order and comply immediately.

Step 4: The Turnover Proceeding. After serving the restraining notice, the lender can initiate a turnover proceeding under CPLR §5225, which asks the court to order your customers to turn over the restrained funds directly to the lender. If your customers comply without challenge, the money flows from your customer to the MCA lender — bypassing you entirely.

Legal Strategies to Stop Restraining Notices to Your Customers

The defense against customer-directed restraining notices requires a multi-pronged legal approach that addresses both the immediate crisis and the underlying judgment:

1. Emergency Order to Show Cause with TRO. Your attorney files an Order to Show Cause in the court where the judgment was entered, asking the judge to vacate the COJ and include a temporary restraining order that immediately prohibits the lender from enforcing the judgment — including serving restraining notices on your customers. If granted, the TRO requires the lender to withdraw all outstanding restraining notices.

2. Challenge the Scope of the Restraining Notice. CPLR §5222 restraining notices are limited to property “in which the judgment debtor has an interest.” If the lender has served notices on customers who do not owe you money, or on receivables that are subject to prior assignments or SBA-secured interests, the notice exceeds its lawful scope and can be challenged on that basis alone.

3. Vacate the Underlying COJ. The most powerful defense is eliminating the judgment itself. If the COJ was filed against an out-of-state defendant after August 2019, it is voidable under the amended CPLR §3218. Additional grounds include procedural defects (improper notarization, defective affidavit), the usury defense (MCA reclassified as a loan with APR exceeding 25%), and fraud in the origination of the MCA contract.

4. Assert Tortious Interference Claims. If the lender served restraining notices based on an invalid judgment, or if the notices were designed primarily to destroy your business relationships rather than collect a legitimate debt, your attorney can assert counterclaims for tortious interference with business relations and abuse of process. These counterclaims create settlement use because they expose the lender to damages beyond the original MCA amount.

What Your Customers Are Legally Required to Do

Understanding your customers’ obligations helps you handle the situation without creating additional legal problems:

Customers must comply with a valid restraining notice. Under CPLR §5222(b), any person served with a restraining notice “is forbidden to make or suffer any sale, assignment, or transfer of, or any interference with, any property in which the judgment debtor has an interest.” Non-compliance can result in contempt of court and personal liability for the full judgment amount. This is why your customers take these notices seriously — they have no practical choice but to comply.

Customers can challenge the notice. Your customers are not defenseless. They can contest the restraining notice if they believe it was improperly served, if they do not owe you money, or if the property described in the notice does not belong to you. But most customers will not voluntarily engage an attorney to fight a restraining notice on your behalf — that burden falls on you.

The notice has a one-year expiration. A CPLR §5222 restraining notice is effective for one year from the date of service. After that, the lender must serve a new notice to continue the restraint. But waiting out the clock is not a viable strategy — the lender will simply re-serve the notice, and your customer relationships will have been destroyed long before the year expires.

Your customers may owe you a duty of notification. Depending on your contracts with your customers, they may be required to notify you when they receive a restraining notice. If your contracts include an assignment provision or a notice requirement, your customers’ failure to notify you promptly may give rise to a breach of contract claim. Review your customer agreements with your attorney.

Protecting Your Customer Relationships During the Crisis

The legal fight is only part of the battle. You must simultaneously protect the business relationships that the MCA lender is trying to weaponize against you:

1. Proactive communication. Contact every customer who received a restraining notice immediately. Explain that the notice stems from a disputed business matter, that you have engaged an attorney, and that you expect the restraint to be lifted within days. Do not ask your customers to ignore the notice — this would expose them to legal liability and damage your credibility.

2. Attorney-to-customer letter. Have your attorney send a professional letter to each affected customer explaining that a motion to vacate the judgment has been filed and that a court order releasing the restraint is expected. This letter carries more weight than your own communication because it signals that the matter is being handled through proper legal channels.

3. Alternative payment arrangements. While the restraint is in effect, discuss with your attorney whether your customers can make payments into an escrow or trust account that is not subject to the restraining notice. This depends on the specific language of the notice and the court’s jurisdiction, but it may provide a temporary workaround that keeps cash flowing while the legal challenge proceeds.

4. Document the damage. Keep detailed records of every customer who stops doing business with you as a result of the restraining notice, every contract that is terminated or not renewed, and every dollar of revenue lost. This documentation supports your counterclaims for tortious interference and strengthens your settlement position against the MCA lender.

The FTC’s Telemarketing Sales Rule prohibits debt settlement companies from charging fees before delivering results. Any firm that asks for upfront payment before stopping restraining notices or settling your debt is violating federal regulations. The CFPB complaint portal is available if you encounter such practices.

Top Companies to Stop MCA Restraint Letters to Your Customers — 2026

Here are the three top-rated firms serving business owners whose customers are receiving restraining notices from MCA lenders in 2026. Only one — Delancey Street — offers emergency COJ vacatur with attorney-coordinated restraining notice defense. The other two handle broader categories of business debt and may be appropriate depending on your specific situation.