Criminal Defense Lawyers

Illinois MCA Defense Lawyers

Illinois MCA Defense Lawyers: Understanding the Legal Landscape

When you’re dealing with Merchant Cash Advances (MCAs) in Illinois, it’s important to know that they are structured differently from loans—but they act like them. I’ve seen many business owners misled by the language used. And yes, Illinois law helps. MCAs may not be called loans, but, we attorneys argue that they are, in fact, loans. Why? It’s because MCA providers charge disguised interest rates that sometimes exceed usury limits, like in Illinois. The law doesn’t ignore that.

Key Strategies in MCA Defense

When we take on MCA defense cases, we focus on specific strategies—because these contracts aren’t always airtight. We’ve challenged confession of judgment clauses, which try to eliminate your right to defend yourself in court. That’s unfair and predatory. Here’s what a confession of judgment clause is: The MCA lender can enter a judgment against your business without giving you the chance to respond. Courts in Illinois, and other states, are catching up to this practice. They’re cracking down. I once had a client who, because of a confession of judgment, had their assets seized overnight. Without a trial. We challenged it in Illinois, citing improper procedure, and guess what? We won. Even partial wins can mean a lot.

The Importance of Partial Wins

Speaking of partial wins—what does that mean in MCA defense? Well, sometimes we don’t get the entire debt wiped out, but we can negotiate a significant reduction. And trust me, getting 60-70% of that debt erased can be a lifeline. What’s crazy is that I’ve seen MCA contracts without proper reconciliation provisions. In Illinois, MCA agreements must let you adjust payments if your business isn’t bringing in the same revenue. If it doesn’t? That contract can be challenged. Remember the Kapitus Servicing, Inc. v. Suburban Waste Services case? Illinois courts looked closely at payment structures that didn’t align with actual receivables, and the court ruled that the agreement resembled a loan, not a sale of future receivables.

Fighting Fraud and Unfair Practices

Illinois MCA defense attorneys will always focus on fraudulent inducement too. Sometimes, MCA providers make promises during signing, only to trap businesses later. When they hide fees or misrepresent terms, we argue fraud, and courts listen. The UCC liens? We fight those too. MCA providers love filing these liens to freeze your assets, making it harder for businesses to breathe. I’ve helped countless clients by showing that these liens were filed incorrectly, buying them time to fight back.

Challenging Personal Guarantees

Another key win for Illinois MCA defense is fighting improper personal guarantees. MCA providers often throw in personal guarantees to seize not just business assets but your personal assets. Illinois law gives us room to fight that—and we do. And let me tell you about debt collection practices. We’ve had success proving that MCA providers engaged in illegal debt collection tactics, like harassment. In Illinois, that can get the entire debt dismissed. It’s a powerful defense. In Illinois, we’ve leveraged the Consumer Fraud and Deceptive Business Practices Act to challenge these shady tactics MCA providers use. If they’ve been lying about terms or misrepresenting fees, we can take them to court, and we can win.

Comparing Illinois with Other States

But not just Illinois, you know? Other states are cracking down too. New York has some of the strictest laws around confession of judgment clauses now. It’s great to see states following Illinois’ lead and protecting business owners. Here’s something every business owner should know: Illinois usury laws cap interest rates. Even if MCAs don’t call themselves loans, if the “factor rate” is too high, we can argue usury. And if we prove usury? The entire debt might be void. I had a case last year where we argued the MCA’s factor rate exceeded the usury limits in Illinois. The lender tried to hide it under complex terms, but we broke it down and won—getting 50% of the debt dismissed. Partial win? I’ll take that any day.

Leveraging Forensic Accounting

Now, forensic accounting—yes, that’s a thing—can be one of our biggest tools in MCA defense. By analyzing your business’s actual revenue, we can show that the fixed payments the MCA provider demanded were unreasonable. I had a restaurant client in Chicago where we used forensic accounting to show that their sales fluctuated seasonally, yet the MCA provider was still taking the same high payments. We got those payments cut down—and saved the business.

Christine Twomey

2024-03-21

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Brendan huisman

2024-03-18

Alex Zhik contacted me almost immediately when I reached out to Spodek for a consultation and was able to effectively communicate the path forward/consequences of my legal issue. I immediately agreed to hire Alex for his services and did not regret my choice. He was able to cover my case in court (with 1 day notice) and not only was he able to push my case down, he carefully negotiated a dismissal of the charge altogether. I highly recommend Spodek, and more specifically, Alex Zhik for all of your legal issues. Thanks guys!

Guerline Menard

2024-03-18

Thanks again Spodek law firm, particularly Esq Claire Banks who stood right there with us up to the finish line. Attached photos taken right outside of the court building and the smile on our faces represented victory, a breath of fresh air and satisfaction. We are very happy that this is over and we can move on with our lives. Thanks Spodek law 🙏🏼🙏🏼🙏🏼🙏🏼🙌🏼❤️

Keisha Parris

2024-03-15

Believe every single review here about Alex Z!! From our initial consultation, it was evident that Alex possessed a profound understanding of criminal law and a fierce dedication to his clients rights. Throughout the entirety of my case, Alex exhibited unparalleled professionalism and unwavering commitment. What sets Alex apart is not only his legal expertise but also his genuine compassion for his clients. He took the time to thoroughly explain my case, alleviating any concerns I had along the way. His exact words were “I’m not worried about it”. His unwavering support and guidance were invaluable throughout the entire process. I am immensely grateful for Alex's exceptional legal representation and wholeheartedly recommend his services to anyone in need of a skilled criminal defense attorney. Alex Z is not just a lawyer; he is a beacon of hope for those navigating the complexities of the legal system. If you find yourself in need of a dedicated and competent legal advocate, look no further than Alex Z.

Taïko Beauty

2024-03-15

I don’t know where to start, I can write a novel about this firm, but one thing I will say is that having my best interest was their main priority since the beginning of my case which was back in Winter 2019. Miss Claire Banks, one of the best Attorneys in the firm represented me very well and was very professional, respectful, and truthful. Not once did she leave me in the dark, in fact she presented all options and routes that could possibly be considered for my case and she reinsured me that no matter what I decided to do, her and the team will have my back and that’s exactly what happened. Not only will I be liberated from this case, also, I will enjoy my freedom and continue to be a mother to my first born son and will have no restrictions with accomplishing my goals in life. Now that’s what I call victory!! I thank the Lord, My mother, Claire, and the Spodek team for standing by me and fighting with me. Words can’t describe how grateful I am to have the opportunity to work with this team. I’m very satisfied, very pleased with their performance, their hard work, and their diligence. Thank you team!

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2024-03-12

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2024-03-12

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2024-02-28

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2024-02-24

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When Bankruptcy Becomes Necessary

And don’t forget about bankruptcy. Sometimes, businesses get so overwhelmed by MCA debt that bankruptcy is the only option left. But even in bankruptcy, an attorney can help protect your assets from seizure under those personal guarantees. I’ve worked with clients where we filed Chapter 11 bankruptcy, giving them room to restructure their business debt, keep their doors open, and get a fresh start. MCA providers can be relentless, but Illinois law gives you options.

Negotiating Settlements and Court Tactics

So let’s talk about settlement negotiations. A good MCA attorney will always push for a lump-sum settlement, cutting down the total debt owed. We’re talking 30-60% reductions sometimes, which makes a huge difference for struggling businesses. And MCA providers? They’d rather settle than go to court. Why? Because they know that if we challenge them, courts can and will rule against them. I’ve seen many MCA providers back down just because we filed a lawsuit.

Understanding Illinois Precedents and Legal Strategies

In Illinois, courts are increasingly scrutinizing MCA contracts, especially those with fixed payments that don’t reflect actual sales. It’s a key part of our strategy, showing that these payments act more like loans—and that’s a game changer. What does usury mean in Illinois? It’s simple: if an interest rate is too high, the loan is illegal. And even if MCAs don’t call themselves loans, we can expose the hidden rates and argue usury. It’s a powerful defense tactic. Don’t forget: New Jersey has similar usury laws that can be applied to MCA contracts. It’s another tool we use in cross-state cases. And in California, MCA providers have to follow specific disclosure laws now—we’re seeing change.

Partial Wins and Business Survival

Now, I’ll admit—winning against MCA providers isn’t always about getting the debt erased entirely. Partial wins, like negotiating better terms or reducing payments, can still keep your business alive. That’s the goal—to keep you in business. In Kapitus Servicing, the court ruled that the fixed daily payments were a clear sign that the MCA agreement was actually a loan in disguise. Illinois attorneys like me use that precedent to challenge these contracts all the time. Another story for you: I had a tech startup client in Springfield facing an MCA lawsuit. We argued that the confession of judgment was invalid because it wasn’t properly filed. Guess what? We won. Debt reduced by 70%. That’s a huge partial win.

Avoiding Bankruptcy: Legal Help Matters

And for those who think bankruptcy is the only option—it’s not always. Before you file, you should consult with an attorney. We can often negotiate a deal that keeps you from going that route. It’s all about exploring every option. Illinois MCA attorneys know the ins and outs of local laws, and we use every tool at our disposal. From UCC liens to improper debt collection tactics, we will find a way to protect your business. Every single day, I speak with business owners who’ve been taken advantage of by MCA providers. They’re scared, they’re stressed, and they’re overwhelmed. My job is to give them hope, and I’m passionate about it.

Filing a Lawsuit: MCA Providers Fear the Courts

Sometimes, all it takes is filing a lawsuit to get MCA providers to back off. They don’t want to go to court. They know their practices don’t hold up under legal scrutiny. We’ve used this tactic countless times to negotiate better terms. I’ve spent years defending Illinois businesses from predatory MCAs, and if there’s one thing I’ve learned, it’s this: these contracts aren’t as ironclad as they seem. With the right strategy, you can win. I’ve even seen Illinois courts rule that MCA agreements violate public policy when they impose undue burdens on small businesses. It’s not just about legality; it’s about fairness. We argue fairness.

Conclusion: Defending Illinois Businesses

Confession of judgment clauses, fixed payments, UCC liens—these are just some of the tools MCA providers use to trap you. But we know how to fight them. Every day, we challenge these tactics in Illinois courts. I’ve worked with businesses across Chicago, Springfield, and Peoria, and while every case is different, one thing is the same: MCA providers rely on business owners not knowing their rights. But that’s where we come in. Let’s not forget: in Kapitus Servicing, the Illinois court wasn’t just looking at the contract; it was looking at the entire transaction. How did the payments align with actual business performance? That’s a critical argument we make.

The Power of Forensic Accounting

I once had a client whose UCC lien was filed improperly, and we were able to argue that in court. The lien was dismissed, and it gave the business breathing room to negotiate a much better deal. Partial win? I’d say that’s a big win. Why do we use forensic accounting in MCA cases? It’s because these MCAs often demand fixed payments, which don’t reflect business realities. When we prove those payments are unreasonable, courts listen. It’s a game changer.

Usury Laws and Their Impact

In Illinois, usury laws are clear—if the interestlaws are clear—if the interest rate is too high, it’s illegal. MCA providers hide those rates behind factor rates and complex terms, but we break it down in court. And when we do, we win. I’ve had clients in Rockford and Naperville who were ready to close their doors because of MCA debt. But after fighting back with the right legal strategy, they’re still in business today. That’s why we do this.