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Howard Ain, Troubleshooter: Startup Business Alert

Updated: Wednesday, November 27 2013, 04:32 PM EST

CINCINNATI (Howard Ain) -- Startup businesses are big these days. Everyone
is looking to get in on the ground floor of the next Google or Apple. Howard Ain tells us, one man learned, if you're not careful, you could
get burned.
Wayne King had a big problem. The
real estate developer decided to take out a loan for $400,000 to invest in a start-up powder coating business. He thought it sounded like a great opportunity.
Powder coating is
the process of coating metal with paint in a powder form that is
considered more environmental friendly.
The con men told Mr. King that the bank was
also lending them a million dollars to get the business off the ground. So, Mr. King thought if the bank and the SBA is backing the loan that he should be able to give $400,000 and be fine. but,
nothing was fine. The con men lied on the bank application. King felt he had done his diligence, but the bank authorizing the loan
didn't do their due diligence on this guy.
While King was being strung along
by excuses and delays, Postal Inspectors found out the business was
never operational. There was never one job produced out of the
business. Both suspects used the money to live off of, to pay personal
debt, and to pay all of their expenses. Within nine months, the money was
gone and they had filed for bankruptcy.
Mr King says, "You should know the people you are
dealing with, find out what their personal finances are." Inspectors
say "King's life has been turned upside down, he is devastated, this was his livelihood, his retirement. He is 73 years old and he still works 8 to 10 hours a day to repay this loan."
The suspects were
convicted of bank fraud and ordered to pay restitution.Howard Ain, Troubleshooter: Startup Business Alert


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