by Structured Settlement Watchdog
Last November, James Viera and Bryann Cabral two former employees of structured settlement buyer Novation Ventures LLC, filed counterclaims against Novation Ventures LLC in a whistleblower action under Section 448.101 et seq of the Florida Statutes.
See Novation Ventures, LLC, a Florida Limited Liability Company, Plaintiff and Counter-Defendant v James Viera and Bryann Cabral, Defendants and Counter-Plaintiffs | James Viera and Bryann Cabral Plaintiffs v John Marsano, Defendant Circuit Court 15th Judicial District in and for Palm Beach County, Florida Circuit Civil Division Case 2017CA00619XXXXMB
In their whistle blower counterclaims against Novation and John Marsano, Viera alleges that during Viera's employment with Novation, he observed various unethical and illegal conduct approved and encouraged by Novation's senior management. (Counterclaim, pleadings #8).
Viera also alleges that the activities, policies and policies promulgated by Novation included among other things:
a. intentionally deceiving clients and potential clients about the tax implications of their accepting certain gifts from Novation contrary to the Florida Deceptive and Unfair Trade Practices Act and contrary to 18 U.S.C.1341, among other state and federal civil and criminal statutes and regulations proscribing such conduct;
b. creating an environment where employees felt compelled to continue working during times when they would not be paid, and otherwise demanding that employees work under conditions which h are contrary to the Fair Labor Standards Act and related federal regulations;
c. creating an environment to pressure, or directly moving potential clients against their will to new states in an effort to forum shop for courts that would be more friendly to approving the structured settlements prepared by Novation (Note: Novation is not involved with structured settlements only structured settlement factoring transactions. The failure to make an accurate distinction is common by secondary market participants);
d. creating fraudulent lotteries where certain of Novation's high-value clients were the pre-determined winners, contrary to 18 U.S.C. Section 1302 and its related regulations, and contrary to other state and federal civil and criminal statutes and regulations; and
e. misrepresented to courts that potential and active clients were residents of particular states when in fact those individuals were not, contrary to state and federal criminal laws respecting perjury and candor to the tribunal.
Viera alleges that he objected and refused to participate in the illegal activities, policies and practices (as set forth in the counterclaim and reproduced above, emphasis ours) and this led to the termination of his employment.
Allegations against Novation Funding underscore the risks of investing in structured settlement derivatives (often scam labelled secondary market annuities)
These very serious allegations against Novation, if proven, could lead to the vacating of structured settlement transfer orders and screw investors who bought Novation's deals.
List of Purported Novation DBAs
Many structured settlement factoring companies use DBAs to conceal their involvement in a deal to ward of poaching by competitors. Sometimes this is to the detriment of the seller. In the Cedric Martez Thomas financial rape case, Novation used the DBA 365 Advance Services and screwed then 21 year old Thomas out of more than $1.4 million in present value. Novation continues to fraudulently advertise that it pays maximum payouts. And who was the Chief Revenue Officer at Novation at the time? John Marsano (according to Marsano's public LinkedIn profile. Novation would have screwed Junior Matos too if not for an alert judge and The Negotiator Guys.
2 The Rescue Lenders
365 Advance Services
Atoni Pola, LLC
Debt Slasher Loans
Eisbock Funding, LLC
LR Company III, LLC
Mead Receivables Trust
No More Waiting, LLC
Novation Capital, LLC
Novation Funding, LLC
Novation Holdings, LLC
Novation Settlement Solutions
Novation Ventures LLC
Obsidis Trust One
Obsidis Trust Two
Shortest Drive, LLC
Spartan Auto Finance
Special Asset Placement Advisors, LLC
Structured Receivables Company One, LLC
Postscript: Subsequent to the post it has been confirmed that John Marsano was replaced as CEO at Novation by Robin Shapiro, who formerly served in that role. Shapiro notably admonished his industry peers about a "race to the bottom" at the National Association of Settlement Purchasers. Let's hope Robin Shapiro's reinstatement as CEO rights the ship at the hailing port.