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Easy money? Hard times
Since December 2001, Land Line has been reporting the on-going story of truckers losing down payments and fees on unfunded financing deals with advance-fee finance companies.

Funding Tree executive arrested
The president of an advance-fee finance company has been arrested on seven felony counts. Kendra Bernal, of The Funding Tree (not to be confused with The Lending Tree) and Integrity Group, was arrested May 31 in Riverside County, CA. Under the two company names, Bernal offered financing of commercial vehicles and other equipment.

Bernal faces six felony counts of taking money and personal property of a value exceeding $400 and one count of engaging in the business of a finance lender and broker without obtaining a license from the Department of Corporations.

The complaint alleges Bernal operated without a license from September 2001 through May 30, 2002, and “took, damaged and destroyed property of a value exceeding $150,000.” The complaint listed money and property taken from Freedom International, Diversified Sales and Service Corp., and owner-operators Luis Ojeda, Joe Diaz, Fernando Hernandez and Jose Martinez.

Finally, the complaint noted a violation of probation had been filed based on these allegations. Bernal was serving a 60-month probation, which prohibited her from receiving or accepting any type of money on behalf of her employer, and from purchasing, selling, registering, transferring, leasing or renting a vehicle without prior permission of the probation officer.

The latest charges came five months after the California Department of Corporations (CaDC) issued a desist and refrain order in January. The order warned Bernal and her companies to stop engaging in business as finance lenders or brokers without a license in violation of the California Finance Lenders Law. The same month, Land Line became aware of Bernal, after two OOIDA members read Land Line’s report about advance-fee finance companies and called in their complaints about Bernal.

OOIDA member Donny McCain paid The Funding Tree a $2,000 deposit Sept. 9, 2001, for trailer financing. He was off work five weeks waiting for the promised financing that never materialized. Finally, REB Express, the company where he was leased, ended up financing the trailer for him.

OOIDA member Robert Kovalcin paid Integrity Group $8,795 in December 2001 for a down payment and fees for truck financing that never came through. After months of telephone calls and complaints, Kovalcin finally received $8,400 of his money back in May.

Bruce Peterik has assumed the post of corporate president of The Funding Tree following Bernal’s arrest and subsequent resignation as an officer and director of the corporation. He says the company is working with the appropriate state agencies to ensure its operating procedures are in full compliance with all state and federal laws governing the equipment leasing industry.

Despite the cease and desist order from the CaDC, the company continues its attempts to provide financing. The Funding Tree says it specializes in funding equipment purchases for commercial companies with “B” through “D” credit types. The company says it funds these transactions through equipment leases.

“As changes are being implemented, The Funding Tree is working purposefully to fund transactions that were temporarily delayed and to process refunds for those who chose to cancel their transactions,” Peterik said. “The Funding Tree fully intends to emerge as a viable operation.”

E-mails and telephone calls to find out Peterik’s experience and Bernal’s status with the company have gone unanswered by Peterik.

Commercial Money Center files bankruptcy
Commercial Money Center (CMC), a name some truckers will find familiar, is seeking to reorganize under Chapter 11 bankruptcy protection.

The advanced-fee finance company filed Chapter 11 bankruptcy May 30 in the U.S. Bankruptcy Court, Southern District of Florida, although the company is headquartered in Las Vegas and was operated mostly from an office in Escondido, CA. The Escondido office closed in March, and visitors to the Las Vegas headquarters were referred to EZ Asset Management, a repo service on Boulder Highway. All CMC leases are being serviced by U.S. Bancorp.

CMC has been the subject of Land Line articles about truckers losing down payments and fees on unfunded financing deals. Those who did receive financing are paying interest rates as high as 50 percent.

Judge Raymond B. Ray imposed a July 1, 2002, deadline for CMC to file missing documents, including schedules and statement of affairs. The first meeting of creditors was scheduled for 10 a.m. July 9, 2002, at the U.S. Courthouse, 299 E. Broward Blvd., Suite 411, Fort Lauderdale, FL.

The deadline for creditors to file proof of claim (case no. 02-24068) is Oct. 7, 2002. CMC’s attorney Bradley S. Shraiberg may be reached by calling (561) 395-0500.

—by René Tankersley, feature editor

Aug/Sept Digital Edition