Home News Coronavirus Update: Small Businesses Fall Victim to Predatory Lendors

Coronavirus Update: Small Businesses Fall Victim to Predatory Lendors

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Federal and state regulators are aggressively pursuing predatory lenders who target cash-strapped small businesses with high-cost loans and abusive collection tactics.

More than a dozen small business owners in six states report that even after their revenues vanished due to pandemic shutdowns, the lenders kept extracting money from their bank accounts and sometimes took legal action to freeze their assets.

The New York attorney general is suing RCG Advances, saying that it sometimes threatened physical violence to collect repayment. Another similar cash advance company, Par Funding, was raided by the FBI on July 28 and has been sued by the Securities and Exchange Commission (SEC). The Philadelphia-based company’s CEO, Joseph LaForte, was arrested on August 7 on a weapons charge in Pennsylvania and is now in federal custody. The SEC identified LaForte as a “twice-convicted felon” who, in 2009, was charged with conspiracy to operate an illegal gambling business and was ordered to pay $14.1 million in restitution for grand larceny and money laundering.

“We’re looking hard to make sure that those lenders aren’t adding to the misery and setting small businesses up to fail,” said Rohit Chopra, a commissioner of the FTC, in an interview with NBC. “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.”

MORE ON THE PANDEMIC

Roughly six months after the U.S. reported its first coronavirus case, the number of infections now top 20 million worldwide. More than half of the cases are in the U.S., India and Brazil. Health officials believe the actual number is higher, given testing limitations and the fact that about 40 percent of those infected have no symptoms. The U.S. death rate, more than 163,000, is the highest in the world.

According to the American Health Care Association and National Center for Assisted Living, a spike in new Covid-19 cases in U.S. nursing homes is being attributed to community spread and a surge in infections in the general population. A lack of rapid testing and personal protective equipment is also contributing to the increase. Covid-19 cases in nursing homes rose to 8,628 for the week of July 19, from a low of 5,468, just one month earlier.

Teens who use e-cigarettes, or vapes, are up to seven times more likely to contract coronavirus than non-vape users, this according to a new study conducted by the Stanford University School of Medicine.

The study is based on the surveys of over 4,300 young people age 13 to 24 in the U.S. Results found that young people who had ever used e-cigarettes were five times more likely to be diagnosed with the virus, while those who had used both e-cigarettes and regular cigarettes within the previous 30 days were about seven times as likely to be diagnosed with the disease.

Officials in the Big Ten and Pac-12 are continuing discussions about whether to cancel college football this fall due to the pandemic.

On Tuesday, the University of Massachusetts decided to cancel the fall season, joining Connecticut. UMass is the 27th Bowl Subdivision program to put off fall sports.

Pac-12 leaders are awaiting suggestions from the conference’s medical advisory panel. Doctors in the conference say the rate of positive COVID-19 tests in Pac-12 states will be a critical factor in determining whether teams can play. Growing data about myocarditis, or inflammation of the heart, found in some recovered Covid-19 patients, is also a concern among college sports leaders and school administrators.

The Pac-12′s season is scheduled to start Sept. 26.

Dollar Tree and Family Dollar have joined a growing list of retailers that require customers to wear masks while shopping. The initial policy of the two stores only requested customers wear face coverings in stores where local and states mandates were put into place.

In July, Walmart, Kroger, Best Buy began requiring masks along with other businesses. Target, Old Navy and McDonald’s started requiring masks at stores nationwide Aug. 1.

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