WASHINGTON — The Consumer Financial Protection Bureau on Tuesday filed an enforcement action against Top Notch Funding, a New Jersey-based loan broker that targeted its offers at consumers waiting to cash out on settlements or victim-compensation funds.

“It is reprehensible that Top Notch and its owner sought to scam NFL concussion victims, 9/11 heroes, and others to turn a quick profit,” CFPB Director Richard Cordray said in a press release. "We allege that this company, its owner, and its associates misled vulnerable consumers by lying about the terms of the deals they offered.”

In the CFPB's lawsuit, filed in federal court in the Southern District of New York, the agency alleged that the company misrepresented itself and the terms of its loans, promising, for instance, 1% or 2% annual percentage rates when typical rates actually exceeded 20%.

CFPB Director Richard Cordray
"We allege that this company, its owner, and its associates misled vulnerable consumers by lying about the terms of the deals they offered," said CFPB Director Richard Cordray. Bloomberg News

Additionally, the firm pretended that it was a lender and that it had offices in all 50 states, including a staff of attorneys and accountants. But it had no offices at all, no attorneys or accountants on staff, and only served as a loan broker, referring consumers to lenders and taking a commission on the deal, according to the CFPB.

The CFPB is demanding that Top Notch’s owner, Rory Donadio, and his business associate John “Gene” Cavalli stop offering loans to consumers awaiting settlements or victim-compensation funds. The agency is fining Donadio, Cavalli and the company $70,000 in total.

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