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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
I also was approved thru wombly and my lender benworth it says I received my money which in fact I did not. When contacting customer service or SBA office I was given conflicting information that mad no sense or asked to submit the same Information multiple times or would recieve and response that pertained nothing to the issue I was tryin to resolve. Please contact me and help me with what I can do.
I’ve been receiving solicitation emails that say I received a PPP loan 2021-05-12 with Prestamos CDFI, LLC in the amount of $20832.00.
I never applied for a PPP loan and never received any funding from Prestamos. I searched for my name and my company name at federalPay.org which is supposed to list who got loans and didn’t find myself. So maybe it’s just phishing emails I’ve been getting but I want to make sure Prestamos didn’t get money for themselves by just using my company name and not contacting me at all…
Add me to the list as i am also a victim of this.
Hello my name is Dustin Arrington. Iwas robbed. SBA says they sent the funds to prestamos cdfi and when I ask prestamos they said they sent the money back. I then called back the SBA and they laughed and said, Mr Arrington we have paided you already. Plus funny thing is that when you serch my name on the internet it’s all over the web about me receiving a ppp loan through prestamos cdfi and It’s all a bunch of trash because My company and I fell hard to thinking we were gonna get blessed during the hard time we were going through but instead we were lied to and truly convinced that the loan was on the way to our bank. Yeah and I also have all the emails saved and calls saved for proof that prestamos screwed me over. None of there story’s ever match up, they tell me 5 different things about the situation and I almost wanted to stop my career and life altogether due to this mess as it put me me in a great depression and had a dark cloud over me which is still lingering today. When this settlement goes through which it will because prestamos cdfi did steal from all of us…..hopefully I can have faith again for this country and my true self. God bless to everyone going thru the same situation as I am. Peace.
Dustin Arrington
Napa, Ca
Hello, yes I have had the same issue with Prestamos and Blue Acorn. After signing the contract they never sent the money, when I followed up on it they asked for me to switch the bank and I did and they still never sent the money. When I inquired after that they stated I was not eligible and when I stated I had a contract they froze up because they didn’t know the answer to it.
I’m definitely interested in doing this class action lawsuit they approved me and never funded me and I received emails from the sba to pay the loan
I was approved for the 2nd PPP loan. Was even told it had been attempted to be deposited in my bank account. After communicating for months & months, never did receive my funding! The kept “escalating” it to management but that was a lie also apparently. I feel Blueacorn was a scam and possibly kept my funding.
I was approved in April 2021, never got money and it is now time for me to do loan forgiveness
Prestamos was supposed to fund my loan but never did. I need to join this lawsuit.
Me too
I was approved for a PPP loan and according to the SBA website was paid but never received any funds from Blue acorn.
Same situation
I am in the same boat. I was approved, signed my promissory note, and my money was disbursed to the bank. However, the money never got to me because I had to change my routing number. After, I changed it I got an email saying they had an issue but no explanation on it and the email said they can’t help me. They got my loan money from the sba, I signed my promissory note, and never got anything not even answers of why
Let me open up some of y’all eyes 👀 but 90% of the small business owners that didn’t receive their funds are Black African Americans and too be honest all of us are African Americans and with the EIDL TARGETED ADVANCE I’ve done my homework,”TRUE FACTS!!!! And I most definitely want in in this Top Class Action so how do I sign up???