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• Pending Government Action:

  Government Action: BBB reports on known government actions involving business’ marketplace conduct:

  Rochester man arrested, accused of defrauding lending company out of hundreds of thousands of dollars
  

  The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the governments allegations, which have not yet been proven.

  
  

  ROCHESTER, N.Y. - U.S. Attorney Trini E. Ross announced today that Paul Paredes, 52, of Rochester, NY, was arrested and charged by criminal complaint with wire fraud, money laundering and aggravated identity theft. The charges carry a mandatory minimum penalty of two years in prison, a maximum of 20 years and a $500,000 fine.
  
  
  
  Assistant U.S. Attorney Katelyn M. Hartford, who is handling the case, stated that according to the complaint, since 2013, Paredes has owned J&E Business Consulting LLC, which provides merchant services to client businesses, including acting as a broker between the credit card processing companies and smaller retail businesses. Small businesses provide J&E with their financial information, such as the owner’s identifying information, including driver’s license, social security number, and email, as well as bank account information.
  
  
  
  In January 2023, the FBI received information that a financial lending company (Victim 1) made numerous loans to customers of J&E, known as “equipment financing” loans. These loans were paid out to J&E’s bank account for supposed equipment sold to victim businesses, who supposedly applied for and agreed to the repayment terms of the loan in exchange for getting the equipment. However, only a very few repayments were made on the loans, and subsequent investigation by Victim 1 determined that customers had never applied for nor agreed to any such loan, nor had they acquired or had any knowledge of the specified equipment. In the instances in which repayments had been made, these customers were either unaware of them, or had been told by Paredes that the payments were for a different purpose.
  
  
  
  According to the complaint, between May and November 2022, Paredes fraudulently submitted approximately 42 loan applications using the identities of approximately 31 individuals to Victim 1 and, as a result, the victim paid approximately $2,000,000 to J&E. The money was used for loan repayments to Victim 1 and other loan companies, as well as personal expenses such as credit cards, travel, and vehicles. Just four percent of victim funds were utilized for business-related expenses.
  
  
  
  Paredes made an initial appearance before U.S. Magistrate Judge Mark W. Pedersen and was held pending a detention hearing on October 18, 2023.

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