A company with 468 complaints to the Better Business Bureau and with legal action against it by New York Attorney General Eric Schneiderman has surfaced in Woodward.

Tom Hunter, long-time business owner of Modern Appliance was eager Tuesday to get the word out that this company called Lease Finance Group  and all of its "shell company" names including, Gray Stone, Retriever, Northern Leasing, LLC, is a predatory company.

"I just want businesses to know that these people are here and they are going to be getting to more Woodward businesses," Hunter said. "They are a scam."

Lease Finance Group, LLC., which appears to be the foundational group of too-many-shell-companies to name, is a Chicago based lease finance group that specializes in the leasing of credit card machines used by small businesses to accept payment from customers who use credit and debit cards.

For nearly two years, Hunter has been fighting with the company and he wants other Woodward business owners to beware.

Self-described victims of this group all over the U.S. say that a sales person often comes into their store and tells them if they purchase to their credit card readers, they will pay a reduced percentage rate of each sale.

According to Hunter and other victims who have published detailed accounts of what happened to them on numerous scam identification sites, the sales people from this group present them with a flurry of paperwork that they rush the customer through. The company then promises that they will not pay for the card reader for 90 days and if they are not happy they can simply cancel the service.

But within the numerous pages of paperwork is an equipment contract that commits the business to at least a year and there is a buyout clause, Hunter said.  In many cases, business owners have authorized automatic withdrawals for their monthly "equipment rental" fees.

When it becomes clear that the transaction fees are still elevated and the card readers don't work, Hunter and others say they called the company only to be told they had to pay a significant buyout on the contract.

"If I didn't have any assets I would have just let the company sue me," he said. "But that is why they prey on small business, because they can make threats to harm the business."

According to the Better Business Bureau (BBB), the company has government action pending against it and has hundreds of complaints filed against it as well.

According to the BBB, the company is graded as an "F," based on numerous complaints to which the company has never responded.

Calls made to the Lease Finance Group of Chicago were not returned.

As the retail and services industry becomes more and more based on point of sale technology, it is imperative that business owners know how to spot a fraud when it comes to payment processing companies, said Justin Goes, director of marketing for PayTrace.

PayTrace, based in Washington state, is a legitimate point of sale software company that provides businesses with the software and a tiny computerized card reader to merchants who want to use their computer to accept credit and debit cards.  Pay Trace is a processing center for those transactions and also works directly with all of its customers to help them understand the process.

According to Goes, merchants who wish to allow their customers to pay with credit need to take the time to have their bank or financial institution explain how the process works.

But key, Goes said, is knowing on the front end how to spot a company trying to defraud them.

"In order to accept Visa or Mastercard a business has to be underwritten by the bank or financial institution," Goes said. "That's because the bank  is the one who funds those credit card transactions and so merchants have to fill out an application to be approved to be underwritten for those."

According to Goes, Visa and Mastercard have set rates for the cost of transactions called "interchange rates" and every business that chooses to accept credit or debit cards as payment for services or goods has to pay those costs. The rates vary, depending on the type of cards used and what kind of information sales clerks gather from a customer at the point of sale, Goes said.

"No one gets around that, so if a company is saying they can get you a lower rate, then there is probably something fishy about that in the first place," Goes said.

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