LOS ANGELES, CA – The Federal Trade Commission (FTC) has secured an injunction against Seek Capital and its founder, Roy Ferman, after a U.S. District Court in California granted the agency’s motion for a preliminary injunction. The court’s ruling blocks Seek Capital from making false claims about small business loans or lines of credit and prohibits the company from contacting consumers whose information it obtained before February 20, 2025.
Seek Capital, a company targeting aspiring small business owners, has been accused of a fraudulent scheme that deceived clients into paying thousands of dollars under the false pretense of securing business loans. According to the FTC’s November 2024 complaint, Seek Capital falsely advertised itself as a provider of small business loans, only to charge clients significant fees for opening credit cards in their names—often without their knowledge or consent. These actions have resulted in over $37 million in damages to small business owners.
“Starting or growing a small business is no easy task and it is made harder by those who deceive small business owners with false promises of liquid capital,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC will ensure that all consumers looking for financial products and services, including small business owners, are protected from those who break the law.”
Seek Capital’s marketing materials aggressively promoted itself as a leading provider of business loans, claiming that small business owners could quickly access tens of thousands of dollars in credit. However, instead of delivering the promised funds, the company applied for personal credit cards in the business owners’ names, charging hefty fees of up to 10% of the total credit line. Business owners typically only learned of this when they saw a drop in their credit score or received bills for credit cards they had not authorized.
One business owner affected by the scheme stated, “My business plan got stalled, and I did not expand my company as planned. My credit has still not recovered… If I had known Seek would only apply for credit cards, I would have never signed up with Seek.”
The FTC’s injunction comes after the court found that Seek Capital and Ferman’s actions were likely to succeed in the agency’s claims, with the court agreeing that the relief was necessary to prevent ongoing harm to consumers. As part of the injunction, Seek Capital is also prohibited from collecting invoices from victims of the scheme.
The case highlights the growing concern over deceptive financial schemes targeting vulnerable business owners, and the FTCs commitment to protecting consumers from such harmful practices.
