Press Releases

Notice to All Medical Capital Investors Regarding the Sixth Report Issued by the Court Appointed Receiver from the Securities Law Firm of Tramont Guerra & Nunez, PA

Coral Gables, January 23, 2010 – The Securities Law Firm of Tramont Guerra & Nunez, PA (TGN) comments on the sixth report issued by Thomas A. Seaman, the court appointed Permanent Receiver ("the Receiver") for Medical Capital Holdings, Inc. ("MCH"), and its subsidiaries and affiliates. While the investigation and forensic accounting continues the Receiver's sixth report makes it abundantly clear that MCH investors will sustain significant losses and would be able to recover only a small percentage of their investments from MCH assets. The forensic accounting conducted to date contains two new developments: "[n]o Medical Provider Funding Corporation [MP I – VI] ever generated enough profit to pay its investors' principal and interest," and MCH utilized eight fully owned subsidiaries to transfer loans and assets, valued at under $1 billion, "which facilitated the payment of earlier investors' principal from new investors' funds." The use of offering proceeds to pay earlier investors was in direct contradiction to the Private Placement Memorandums distributed by MCH.

As of December 31, 2009, the Receiver has collected a total of $21.4 million since his appointment, with investors' owed principal of $1.079 billion from the $21.4 million. The Receiver's report on the status of the accounts receivables shows that of the "104 accounts receivable clients … 53 of the accounts (totaling $542,894,528) are not viable or not longer exist." In addition, 39 of the Verifiable Accounts Receivables (totaling $74,523,150) are aged more than 180 days.

Investors should consider whether an individual securities arbitration claim filed with the Financial Industry Regulatory Authority (FINRA) is an effective method to recover their investment losses. The brokerage firms who distributed the securities issued by MCH and its affiliated entities were obligated to conduct due diligence of facts concerning the risks associated with the investments. Financial advisors told many investors that these securities were suitable for current income investment objectives. Brokerage firms are obligated to give, and investors are entitled to rely upon, brokerage firms for competent, suitable investment advice in accordance with FINRA Rules and Regulations. Recommendations of unsuitable investments and/or failure to conduct adequate due diligence are both causes of action that form the basis for individual securities arbitration claims filed with FINRA.

The Securities Law Firm of Tramont Guerra & Nunez, PA, is a nationally recognized, Martindale Hubbell "AV" rated securities law firm.  To request a confidential consultation from a TGN attorney to assist you in determining whether you have a viable individual claim for investment losses that exceed $100,000 from a full service brokerage account, contact us on our website.  To speak directly with an attorney, call (800) 578-0137 and ask for Benjamin Fernandez, Esquire.

Contact:
Benjamin Fernandez, Esquire
2100 Ponce De Leon Blvd, Penthouse II
Coral Gables, Florida 33431
(800) 578-0137

ben@rtgn-law.com
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