Small motor carriers have fallen into problems because of Yellowstone Capital. The latter is now obliged to pay over $9.8 million for the settlement of the Federal Trade Commission (FTC) fraud charges. The problem is associated with Yellowstone’s merchant cash advance services.
Yellowstone’s Merchant Cash Advance (MCA) Fraud
Business owners having received an MCA from the small business funding provider Yellowstone Capital didn’t know the lender was still withdrawing funds from their bank accounts even after they had paid back the amount.
By the way, this isn’t the only case with MCA providers. Some have already proved to have misrepresented their products, assessing unreasonably high fees and bringing clients into a trap of fast growing debt.
As you know, an MCA, as a merchant funding option, provides the necessary working capital for small businesses by taking an upfront sum in exchange for future sales.
In the mentioned case, Yellowstone has allegedly continued to withdraw funds from its clients’ bank accounts for days after they’d paid back the amount. Because of these unauthorized charges, businesses ended up with zero cash. It’d take weeks or months to take the refunds.
MCA From a Reliable Provider
You should be quite vigilant when choosing an MCA provider, especially from an alternative online lender as not all companies are trustworthy. So, make sure to turn to a reputable alternative online lender for a merchant cash advance that offers the most competitive rates and the most advanced solutions in the industry.
As you saw above, lenders like Yellowstone Capital, LLC can provide you with an MCA, business loan, and other quick-fix business financing options and trap you in debt, thus creating headaches for you. Luckily, business owners have a variety of business funding options and aren’t limited to only those offered by lenders like Yellowstone Capital.
So, Yellowstone Capital, which is a provider of merchant cash advances, must pay over $9.8 million for the settlement of the Federal Trade Commission charges. The lender has used business owners’ bank accounts without their consent and wasn’t honest about the funds that merchants would receive and the features of its financing services. When applying for an MCA, do your research and find a trustworthy provider in the field.
Author Bio: Michael Hollis is a Detroit native who has helped hundreds of business owners with their merchant cash advance solutions. He’s experimented with various occupations: computer programming, dog-training, accounting… But his favorite is the one he’s now doing — providing business funding for hard-working business owners across the country.