New York Attorney General Letitia James has announced that her office has secured over $4.6 million in restitution for small businesses affected by predatory schemes conducted by Northern Leasing affiliates, NLS Equipment Finance LLC (NLS EF) and Leasing Expenses Company, LLC (LEC). These companies rented credit card processing equipment to small businesses and were found to have engaged in illegal practices.
"Small businesses are at the heart of communities across our state, and when they are taken advantage of, we all suffer as a result," said Attorney General James. "Northern Leasing and the individuals who ran it spent years preying on small businesses with their fraud. They tried to continue these schemes using different names, but we put a stop to that, and now those companies will have to pay back millions of dollars to the small businesses they took advantage of."
In June 2020, Attorney General James won a lawsuit against Northern Leasing and its affiliates. The court determined that Northern Leasing committed "persistent fraud" by targeting small family-owned businesses such as flower shops, hair salons, automotive repair shops, and restaurants with overpriced lease agreements for credit card processing equipment. The court also found that Northern Leasing abused the judicial process by suing out-of-state customers in New York courts. Consequently, Northern Leasing was ordered to cancel contracts, cease operations, dissolve the company, and stop collecting debts under their leases.
In November 2020, OAG discovered that Northern Leasing's owners had created NLS EF and LEC to continue their fraudulent activities. In February 2021, Attorney General James secured a judgment against these entities ordering them to cease fraudulent practices and stop enforcing canceled leases.
As a result of these legal actions, over $4.6 million in restitution has been secured for impacted small businesses. On September 25, 2024 the New York County Supreme Court entered a judgment requiring NLS EF and LEC to pay $2,671,562.21 in restitution on top of $2 million already collected from them.
Attorney General James has consistently worked on protecting small businesses from fraud. In March 2024 she sued over 30 lenders for issuing illegal loans targeting small enterprises. In February 2024 she secured more than $77 million against Richmond Capital Group and related entities for high-interest loans with undisclosed fees following a prior judgment against three merchant cash advance companies.
The proceedings are being handled by Special Counsel Mary Alestra along with Assistant Attorney General Benjamin Fishman and former Assistant Attorneys General Mark Ladov and Elizabeth Lynch under Laura J. Levine's supervision from the Consumer Frauds and Protection Bureau.