Ever since we first reported on complaints against Northern Leasing Systems, also known as MBF leasing, we've received constant phone calls and emails from other small business owners from all around the country, asking why is nothing being done to stop these people?
Hard to believe a simple credit card processing machine could lead to allegations of a complicated financial web of deceit.
"They ripped me off is basically what they did," Michael Arnold said.
Arnold and his partners run a banner aerial advertising business, and he'd love to fly a message about Northern Leasing systems.
"Absolute fraud" is how he described it.
Arnold says he signed a one-page agreement with Northern Leasing Systems for a credit card processing machine he returned and later got several more pages of a non-cancellable lease he'd supposedly initialed.
"Someone forged my signature," Arnold said.
He says Northern Leasing, claiming he was responsible for leasing the machine, debited his bank account monthly. He put a stop to that, and then came the relentless phone calls to the office.
"Every 5 to 10 minutes, non stop, even on the weekends," Nick Mendoza said.
The worse part for small business owner Arnold is what happened to his credit.
"They wrecked my credit," he said.
For two years, We've heard Arnold's complaints echoed by small business people throughout the country.
"This is definitely criminal. If anything was ever criminal this is criminal," Linda Cohen said.
To a small tour bus operator in Washington D.C.
We discovered that Northern Leasing and its partner company MBF leasing had filed thousands of lawsuits against small business owners for defaulting on ironclad leases.
Now the legal tables are turned. A New York State Supreme Court judge has ruled a lawsuit can go forward as a breach of contract class action against Northern Leasing, headquartered in Midtown. The judge said Northern Leasing must notify everyone who has signed a lease since 1999 that they may have been overcharged. We're talking at least 300,000 people.
Class Action lawyer Krishnan Chittur says there could be a lot of money at stake for alleged victims.
"You're talking $18 million dollars a year and it's been going for 10 years so you're talking about $180 million a year," Chittur said.
For now, the class action lawsuit names Northern Leasing, but Chittur plans a separate suit on behalf of MBF clients like Kostas Gagasoules, who owns a small fur and storage salon on Long Island.
The pattern, he says, was identical.
"I think they're crooks," Gagsoules said.
Northern Leasing and its related companies have 3 floors of a Midtown office building, including a large equipment processing room. We were told there was no one in management to speak with us.
"I didn't know they were in this racquet for so many years, and I don't understand why they haven't been shut down yet," Arnold wondered.
Northern Leasing declined an interview, but said it prides itself on fairness and plans to appeal the judge's decision on the class action. The firm believes in this case, the complaints about its business practices are unjustified and the judge's decision was in error.
NEW YORK AND TRI-STATE AREA NEWS
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