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Prestamos PPP Loans Class Action Lawsuit Overview:
- Why: Plaintiffs accuse Prestamos of pocketing government fees for PPP loan applications, but never funding the applicants.
- Who: Small business owners sued Prestamos, a lending company.
- Where: The class action lawsuit was lodged in Pennsylvania federal court
Three small business owners lodged a class action complaint against the lender Prestamos for exploiting the Paycheck Protection Program (PPP) for its own gain by collecting fees but failing to pay out loans as promised.
The lead plaintiffs are Alicia Marshall, Daniel Pronsky, and Paris Townsend all of whom lost significant income due to the coronavirus pandemic, subsequently applied and were approved for a PPP loan with Prestamos in early 2021, but say they never received their funds.
The class action lawsuit argues that Prestamos’s failure to fund these Small Business Association-approved PPP loans directly harmed Marshall’s in-home healthcare business, Pronsky’s barbeque catering business, and Townsend’s hair care products business.
Marshall, Pronsky, and Townsend seek to represent a national Class of persons and entities in the US who, in 2021, timely applied for PPP loans with Prestamos, but did not receive loan proceeds despite approval, as well as a similar California subclass.
Prestamos Fails to Pay Up on PPP Loans
Marshall, Pronsky, and Townsend each received Small Business Association (SBA) approval on their PPP loan applications and a promissory note regarding the loans.
Despite properly completing, signing, and submitting the required loan documents and multiple attempts to obtain the loan proceeds, they never received their loan funds, says the class action lawsuit.
Marshall even checked with her local SBA office about the loan; the SBA had information of her loan, its approval, and alleged disbursement, although she still hadn’t received the money.
Many other borrowers have complained about not receiving their due funds from Prestamos on the Better Business Bureau’s website and various social media sites.
Under PPP loan provisions, Prestamos should have funded these loans within 10 days of SBA approval. Unfortunately, despite its designation as a Community Development Financial Institution (CDFI), which indicates its dedication to “helping economic growth in underserved areas,” Prestamos failed to follow through on many small business loans it processed.
Prestamos Allegedly Used PPP Loans to Make Itself Money Instead
As an authorized PPP lender, Prestamos was entitled to receive fees from the SBA for each PPP loan it processed. In 2020, Prestamos processed nearly 1,000 PPP loans, reportedly receiving $1.3 million in fees from the SBA, according to court documents.
In 2021, after the SBA increased its fee rates, Prestamos processed nearly 500,000 PPP loans through May 31, 2021. So far, this outstrips all other lenders in 2021, and is more than the total number of PPP loans made by Bank of America, PNC Bank, TD Bank, and Wells Fargo combined, according to the complaint.
Thanks to that substantial amount, Prestamos has reportedly received nearly $1.2 billion in fees in 2021.
The plaintiffs seek compensatory, consequential, and other damages; prejudgment interest; restitution and all other forms of equitable monetary relief including all PPP loan proceeds owed; disgorgement of all fees Prestamos obtained; punitive damages; and reasonable court costs.
Did you apply for a PPP loan from Prestamos or another lender but never received your money? Let us know in the comments section below!
The plaintiffs are represented by Lawrence J. Lederer, Michael L. Murphy, and Patricia M. Kipnis of Bailey & Glasser LLP and Justin A. Heller and Matthew M. Zapala of Nolan Heller Kauffman LLP.
The Prestamos PPP Loans Class Action Lawsuit is Marshall, et al. v. Prestamos CDFI, LLC, Case No. 2:21-cv-04337, in the U.S. District Court for the Eastern District of Pennsylvania
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130 thoughts onPPP Loans Exploited by ‘Community Development’ Lender Prestamos, Lining Pockets With $1.2B
Lockdown decimated my business as a handyman. The PPP loan was the only thing that was going to keep me afloat. These con artists took my application, got the loan approved, then stole the money. As a result, I lost my place to live and my vehicle because I could not pay the bills. Their theft literally ruined my life. I was homeless for over a year because of these people. The emotional damage, the damage to my business, etc cannot be overstated. I pray you pin these people to the wall. I don’t even care if I never see the money, I just want justice.
Me to can I have someone contact me about my approved loan that I did not recieve same situation as all theses others victims cost me a huge deal of pain please help
Please contact me 7029853422 I really need someone to help me with this I still feel like I was robbbed of my money and want it this caused me so much hardship
Yes my name is Tamika Renee I apply for the blue acorn loan and PPP loan in 2021 in 2022 and I posted receive a payment of 8300 are $8,600 and I have not received my payment yet I had got a new email address and I was trying to update it when I went to office
I applied for a PPP loan and got approved from blue acorn through Prestamos and never received any funding I reached out numerous of times and was told my money was going to be sent to me and was in process still nothing
Yes my name is Tamika Renee I apply for the blue acorn loan and PPP loan in 2021 in 2022 and I posted receive a payment of 8300 are $8,600 and I have not received my payment yet I had got a new email address and I was trying to update it when I went to office
I went threw womply and my lender was Harvest . I never received my 2nd draw PPP loan. Suppostly they sent to the treasury of state but still shows online that I got the money. Never got it
Just finding out about the lawsuit my information was used but never contacted…they should designate a better way of communicating victims of fraud.
I need my money back! Womply took my money the sba approved and never paid me back
Where can I join this class action because I was approved and they never gave me my money but sba still showing that I have to pay back a loan
Hi my name is Connie Garlin I got approved for the PPP loan on 05/13/21 and never received any funds. According to a statement I received from BlueCorn the funds “Allegedly” were disbursed.
i applied for the ppp loan thru blue acorn and never onced recieved it, i seen that i did quilify and that it was posted on the sba website that i recieved the funds.i gave up on even trying to communicate with said parties.because i did not recieve that money it has been a major blow to my situation.i hope that i get this resolved.
My name is Joseph Papa. I also got screwed over by blue acorn and prestimos. I have the sba approval and even tried to fund to my Dave banking account which I filled out because my main bank wasn’t on their plaid approval process so I set up a dave account because it was on the first page of plaid approval. Well they sent the funds and dave returned the funds. I tried for months to update my banking information. I created several tickets with them because they don’t have a phone number. I have several different employees from them assure me that my funds are guaranteed and are coming and just to remain patient. This went on and on and then one day they say that now I’m not approved anymore even after being promised 50 times that its guaranteed and there’s nothing I need to do. This has cost me my business. Between covid and then Blueacorn was enough to destroy any chances of recovery. If it is possible to join this class action please Email me back at the earliest time possible at kendallpapa@gmail.com.
Wow exactly I choose dave and they returned the money as well made several tickets and the assured me my money was safe then one day getting and email to update bank info to immediately getting denied and stated I could not appeal decision just felt robbed
So everyone is saying it happened to them from various lenders now what does anyone have the info of who to contact so some thing can be done or is this just another tally on the list of things we did wasting our time and energy to get no where ? Who do we contact that can help us with our situations
Thank you! So tired of the endless pages of “me too” stories and no clue on how or where to get help. Why is it so hard?