The New York Attorney General's office recently announced a major victory over a Hudson Valley-based business accused of defrauding nearly 30,000 businesses across the nation.

Northern Leasing Systems, Inc. of Middletown ran a scheme that crushed small businesses from coast to coast. The State Attorney General's office accused the company of targeting small family-owned businesses like salons, restaurants, auto repair shows, and bars and would trap them into overpriced, never-ending lease agreements for credit card processing equipment.

When a company would default on the payment, Northern Leasing Systems would file a claim against that business in New York Court. Due to the expense of traveling to New York to defend themselves, may business owners could not attend or afford to hire a lawyer. Therefore, default judgments were ruled in Northern Leasing's favor. They went on to receive more than 29,500 payments at the expense of the small business owner on the other side of the transaction.

The court ruled that their tactics were deceptive and 'created an enterprise conducive to fraud'. Northern Leasing's requirement that businesses defend themselves in New York County Civil Court combined with limited customer service options were deemed unfair.

The court has ruled that principal Jay Cohen, V.P. Neil Hertzman, and collections attorney Joseph Sussman were all liable for the scheme. They are forbidden from ever running a similar business and must dissolve the company no later than 60 days after plaintiffs have been compensated. Any business that was affected by this fraud from April 1, 2013, through the present will receive a settlement and any contract they were under is considered null and void.

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