Strategic Financial Solutions, a financial services firm with 264 employees in the Buffalo area, has been shut down as the result of a civil case brought by a federal consumer protection agency.
Strategic Financial Solutions is aiming to reopen its operations, pushing back in federal court against the suit filed by the Consumer Financial Protection Bureau in conjunction with the attorneys general for seven states, including New York.
The agency’s complaint is under seal by the court, but Dennis Vacco, a lawyer representing Strategic Financial Solutions, said the CFPB is claiming the company violated a federal regulation designed to protect consumers, which the company denies.
The government last week secured a temporary restraining order and the appointment of a receiver to take control of the company, without giving Strategic Financial Solutions an opportunity to tell its side in court, Vacco said. The receiver shut down Strategic Financial Solutions’ operations on Jan. 12.
“(The receiver) has shut down bank accounts, frozen employees out of Strategic’s IT systems, cut off all access to email, refused to provide service to Strategic’s law firm clients,” Vacco said in a court filing. “In general, the receiver has taken every step possible to ensure that Strategic cannot function. In short, the receiver is not managing Strategic, he is killing it.”
Vacco is asking U.S. District Judge John L. Sinatra Jr. to dissolve the temporary restraining order and remove the receiver, and enable the company to reopen.
The documents filed by the CFPB in the case were under seal, and the agency has not commented on the case.
Strategic Financial Solutions is not a debt collection firm. The New York City-based company, which has offices in Amherst, provides administrative services to law firms that retain clients seeking to settle debts. Strategic Financial Solutions sets up standalone entities to work with those law firms.
Vacco said last week’s…
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