UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF FLORIDA 

SECURITIES AND EXCHANGE COMMISSION, 

Plaintiff, 

v. 

COMPLETE BUSINESS SOLUTIONS GROUP, 

INC. d/b/a/ PAR FUNDING, et al., 

Defendants. 

I -------------------

CASE NO.: 20-cv-81205-RAR 

DECLARATION OF ARIEL BENJAMIN (BEN) MANNES 

Pursuant to 28 U.S.C. Section 1746, the undersigned states as follows: 

I. My name is Ariel Benjamin Mannes. I am over twenty-one years of age and have 

personal knowledge of the matters set forth in this Declaration. 

2. I began work at Full Spectrum Processing ("Full Spectrum") on June I 0, 2019 and was 

the Chief Compliance Officer for all Full Spectrum accounts to include Complete Business 

Solutions Group ("CBSG") until the recent appointment of the Receiver. 

3. As the Compliance Officer, I was assigned to review credit insurance problems for CBSG 

policies. Joseph Cole Barieta asked me to address issues with CBSG's insurance policies with 

Euler Hermes, as they would not process claims from the 2018 policies. In examining the 

policies, accounts identified for claims and in discussions with Euler Hermes staff, it was 

determined that CBSG's insurance policies were incorrectly purchased, as it does not provide 

coverage for CBSG's merchant cash advance business model; best defined as "Advance 

Factoring". Instead, the Euler Hermes insurance policies sold to CBSG from a broker named 

Anthony Bernato provides credit insurance coverage for other types of factoring transactions 

requiring a third-party invoice, which CBSG does not do. 

4. Thus, no CBSG claims were ever processed by Euler Hermes, because the policies does 

not cover MCA transactions. 

5. On numerous occasions, I made my manager Joseph Cole Barleta, his client Joseph 

Laforte, their investor relations consultant Perry Abbonizio and his PPMs Dean Vagnozzi, Vince 

Camarta and John Gissas aware that the policies bought by CBSG do not cover their MCA 

transactions and that the Euler Hermes policies does not cover the types of transactions 

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 1 of 7
performed by CBSG. They know this because I told them, verbally via telephone, in person at 

our offices and/or in writing, more than once in a span beginning in the Summer 2019 through 

Spring of 2020. 

6. Attached as Exhibit A is a true and correct copy reflecting correspondence with Euler 

Herman about the lack of coverage in July 2019. 

7. Attached as Exhibit B is a true and correct copy of one of the memoranda I sent about the 

lack of insurance coverage. 

8. There is also an insurance policies concerning A Better Financial Plan that was included 

in the CBSG insurance policies. This policies does not provide coverage either. I advised Mr. 

Vagnozzi of that fact, and both he and Perry Abbonizio called me again in March and April of 

2020 to confirm that our coverage was not valid for claims based on COVID-19 related defaults, 

and to ask what our current coverage status was. 

9. The issue with the lack of insurance continued being discussed until the appointment of 

the Receiver. Joseph Cole Barleta, Joseph LaForte, Dean Vagnozzi, Perry Abbonizio, and others 

constantly asked me about the status of the insurance coverage, and I told them repeatedly, and 

recently, that nothing had changed. While we had paid premiums on a policies, we had no ability 

to file claims for CBSG accounts covered under that policies, as the policies does not cover the 

MCA type of factoring CBSG conducts, where no third party invoice exists. 

10. CBSG continued paying for its insurance policies, and asked for a limited renewal for the 

policies where PPMs were named as beneficiaries even though its executives knew the policies 

did not cover MCA transactions. 

11. In an attempt to rectify the loss of premiums faced by our clients, one of my jobs for 

CBSG was to locate an insurance provider that would insure MCA-type transactions. However, 

after numerous discussions with insurance carriers, I was unable to identify or locate any 

insurance provider that insures MCA transactions, which I reported that back to Joseph Cole 

Barleta and Joseph LaPorte. 

12. Finally, I was advised that Aida Lau had been transferred out of the accounting 

department at FSP's 205 Arch Street office supporting CBSG since late-2019. In 2019, after 

being counseled by her supervisor, she was moved to the 20 N. 3rd Street office, assigned to 

assist Joseph LaPorte and continued working in that capacity until the Receiver was appointed in 

this case. I have personal knowledge of this through my employment at CBSG. 

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 2 of 7
I declare under penalty of perjury that the foregoing is true, correct, and made in good faith. 

Executed this r1 day of August 2020. 

Ariel 

~~ Benjamin Mannes, MA, CPP 

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 3 of 7
8/16/2020 RE: Insurance Claims Followup

file:///C:/Users/rstumphauzer/AppData/Local/Temp/Temp1_OneDrive_2020-08-16.zip/HTML/20190722-Re_Insurance Claims Followup-3544.html 1/2

Subject: RE: Insurance Claims Followup

From: Anthony Z

Date: 7/22/2019, 2:35 PM

To: Bret.Dunbar@eulerhermes.com, Alexis Houser

CC: Roohi.Kake@eulerhermes.com, Ben Mannes <bmannes@parfunding.com>

We sent these contracts in at the me of funding to and your firm approved them

We paid our insurance bill

You are required to either complete the claim or provide an official response as to why we are being denied the claim

We paid for the insurance – we deserve a more sincere effort on your part to sasfy the terms of agreement

Anthony Zingarelli

From: Bret.Dunbar@eulerhermes.com <Bret.Dunbar@eulerhermes.com>

Sent: Monday, July 22, 2019 2:02 PM

To: Alexis Houser <ahouser@parfunding.com>; Anthony Z <anthonyz@parfunding.com>

Cc: Roohi.Kake@eulerhermes.com

Subject: RE: Insurance Claims Followup

We do not provide loan guarantee insurance. We provide Accounts Receivable (invoice) insurance.

Bret Dunbar

Euler Hermes North America | One Penn Plaza, Suite 3325, New York, NY | USA - 10119

Phone: +1 212.502.0533 | Mobile: +1 732.778.3077 | Fax: +1 212.502.0508 | bret.dunbar@eulerhermes.com

eulerhermes.us

cid:image005.jpg@01D46D4B.515C

promo_with_CTA-trade-with-confidence

This is not an automac email and is sent directly from my business email account. Please reply with “unsubscribe” if you wish for me not to reach out moving forward.

From: Alexis Houser [mailto:ahouser@parfunding.com]

Sent: Monday, July 22, 2019 1:40 PM

To: DUNBAR, Bret (EH:AMER); Anthony Z

Cc: KAKE, Roohi (EH:USA)

Subject: Re: Insurance Claims Followup

This is loan garuntee insurance, so why would there be an invoice instead of a contract?

On Mon, Jul 22, 2019 at 1:11 PM Bret.Dunbar@eulerhermes.com <Bret.Dunbar@eulerhermes.com> wrote:

Hi Lexi,

You have noted to our Claims Department that there were no invoices. If there are no invoices, there is no A/R, and therefore there is nothing we are covering.

Regards,

Bret

Bret Dunbar

Euler Hermes North America | One Penn Plaza, Suite 3325, New York, NY | USA - 10119

Phone: +1 212.502.0533 | Mobile: +1 732.778.3077 | Fax: +1 212.502.0508 | bret.dunbar@eulerhermes.com

eulerhermes.us

cid:image005.jpg@01D46D4B.515CA

promo_with_CTA-trade-with-confidence

This is not an automac email and is sent directly from my business email account. Please reply with “unsubscribe” if you wish for me not to reach out moving forward.

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 4 of 7
8/16/2020 RE: Insurance Claims Followup

file:///C:/Users/rstumphauzer/AppData/Local/Temp/Temp1_OneDrive_2020-08-16.zip/HTML/20190722-Re_Insurance Claims Followup-3544.html 2/2

From: Alexis Houser [mailto:ahouser@parfunding.com]

Sent: Monday, July 22, 2019 9:52 AM

To: KAKE, Roohi (EH:USA); DUNBAR, Bret (EH:AMER)

Subject: Insurance Claims Followup

Good Morning,

I'm reaching out because I haven't heard back about the insurance claims that I submitted. I just went through my email, and I submitted all of the necessary

documentation for the following claims (listed below) at the end of march/early April. The supporting documentation was sent from the email

insurance@parfunding.com, and was sent to Roohi's email as well as CCAdmin@eulerhermes.com. Can you please let me know the status of these ASAP?

1. Shore Break Electric/ Tony Nuzzo

2. Ameripro Auto Glass

3. Street Games

4. El Bouza inc

5. Club X

6. J&J Trucking

7. Happy Hands Auto Spa

8. Hybrid Mechanical

9. New Shepard Quality Windows

10. Diamat

11. Gurndoor Chicagos Pizza

12. Catalyst Construction

13. OMS Moving and Storage

Thank you so much,

--

Lexi Huff

Error! Filename not specified.

20 N. 3

rd St

Philadelphia, PA 19106

Error!

Filename

not

specified.

Office: (267) 450-9367

Error!

Filename

not

specified.

Fax: (888) 305-7562

CONFIDENTIALITY NOTICE: This email and any attachments are intended solely for the use of the named recipient(s). Please do not forward or copy without the author’s consent. Any dissemination of this email by anyone other than an

intended recipient is strictly prohibited. If you have received this email in error, please permanently delete the email and all attachments from your system. All information contained in this document are considered proprietary and shall not be

reproduced, transmitted or shared with any individual or company outside the specific group for which this information is strictly intended

Euler Hermes is the world's leading provider of trade related insurance solutions, helping companies of all sizes trade with confidence

Euler Hermes is a member of Allianz. www.eulerhermes.com

-------------------------------------

This e-mail may contain confidential and/or privileged information. If you are not the intended recipient or have received this e-mail i

Read our full e-mail disclaimer statement and monitoring policy

(http://www.eulerhermes.com/Pages/legals.aspx) before taking any action based on the contents of this e-mail.

--

Lexi Huff

http://www.parfundin

signature/par20 N. 3

rd St

Philadelphia, PA 19106

h

Office: (267) 450-9367

h

Fax: (888) 305-7562

CONFIDENTIALITY NOTICE: This email and any attachments are intended solely for the use of the named recipient(s). Please do not forward or copy without the author’s consent. Any dissemination of this email by anyone other than an intended

recipient is strictly prohibited. If you have received this email in error, please permanently delete the email and all attachments from your system. All information contained in this document are considered proprietary and shall not be reproduced,

transmitted or shared with any individual or company outside the specific group for which this information is strictly intended

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 5 of 7
8/16/2020 Update on Euler Hermes

file:///C:/Users/rstumphauzer/AppData/Local/Temp/Temp1_OneDrive_2020-08-16.zip/HTML/20190807-Update on Euler Hermes-1433.html 1/2

Subject: Update on Euler Hermes

From: Ben Mannes

Date: 8/7/2019, 11:19 AM

To: Joe Cole <joecole@parfunding.com>, Joe Mack <Joe@parfunding.com>

CC: "John P. Hartley" <jhartley@parfunding.com>

Gentlemen,

This morning, John and I had our 4th call with Euler regarding their honoring our claims from Mar/April. Below this email is a recap from their regional VP on this

matter. To summarize, we are at a stalemate with Euler because: 

We signed a policy that described a business model we don't truly fit in, and

They never read our MCA agreements and did due diligence upon underwriting our policy. 

That said, they made it clear that all consumer-based claim that sells directly to consumers and doesn't invoice their 3rd party debtors (Chicago Pizza, El Bouza, Street

Games, Happy Hands, etc) will not be honored. They will, however, process the B2B-type claims we can provide a statement of 3rd party accounts & invoices for; but

made no promises (only that they will investigate further in claims).

Therefore, we recommend the following Plan of Action moving forward on the insurance issue:

1. Internally determine which claims we've submitted are able to have invoices reverse-engineered through ACH records to see if we can submit (50-60% of total),

while;

2. Identify Insurance competitors that may be more suited for us, while still covered by Euler (shop around, but due more due diligence on the front end to see if our

claims will be processed).

3. Do a cost vs. benefit analysis on taking legal action against Anthony Bernardo (insurance malpractice by selling us coverage that wasn't applicable to our business

model) and Euler (to refund our premiums)

Once we weigh those, the following questions are presented for your decision(s):

1. Do we pursue the 50-60% of the claims they tacitly said they may process if we can get the info they need or cut bait and seek our premiums back and go with

another carrier?

2. Do we file suit against Bernardo to cover us for losses and our promises to PPMs?

Thank you,

Ben Mannes

Chief Compliance Officer

Full Spectrum Processing

(215) 922-2636 x 118

bmannes@parfunding.com

---------- Forwarded message ---------

From: Ryan.Wimberly@eulerhermes.com <Ryan.Wimberly@eulerhermes.com>

Date: Wed, Aug 7, 2019 at 10:52 AM

Subject: RE: CBSG / Par Funding & Euler Hermes

To: Susan.Horn@eulerhermes.com <Susan.Horn@eulerhermes.com>, Dan Ring (dring@parfunding.com) <dring@parfunding.com>, Jasmine.Smith@eulerhermes.com

<Jasmine.Smith@eulerhermes.com>, Lisa.Bond@eulerhermes.com <Lisa.Bond@eulerhermes.com>, Bret.Dunbar@eulerhermes.com <Bret.Dunbar@eulerhermes.com>,

Joshua.Greaver@eulerhermes.com <Joshua.Greaver@eulerhermes.com>, Ben Mannes (bmannes@parfunding.com) <bmannes@parfunding.com>

All,

Thanks for your me, I found it very helpful. To recap our call:

Euler is on the risk when the risk commences. This is defined as the merchant you’ve funded raising an invoice to a debtor for services or product rendered in a B2B transacon. The

debtor in this transacon is the party CBSG/Par should submit to Euler for underwring of coverage. Once the A/R exists (services/product rendered, invoice raised, purchased by

CBSG/Par), Euler covers the trade credit to the debtor up to the amount specifically approved by Euler underwring at the me the underlying trade transacon occurred (i.e. merchant

conducng business with the debtor).

The debtor in the transacon, not the merchant, is the party to default in order for a claim to be viable, at which point the debt must be assigned to Euler prior to any claim payment.

In terms of both exisng and future claims, we will require the following documentaon to review for coverage:

-Statement of Account

-Copies of invoices to the debtor that have been purchased from the merchant

-Documentaon of amount advanced against these invoices.

Euler team – please feel free to weigh in with any clarificaons.

Thanks,

Ryan Wimberly

Regional Vice President - Northeast

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 6 of 7
8/16/2020 Update on Euler Hermes

file:///C:/Users/rstumphauzer/AppData/Local/Temp/Temp1_OneDrive_2020-08-16.zip/HTML/20190807-Update on Euler Hermes-1433.html 2/2

Euler Hermes North America | One Penn Plaza, Suite 3325 | New York, NY | 10119 | United States Office: (617) 248.8857 | Mobile: (617) 599.6561

Ryan.Wimberly@eulerhermes.com | eulerhermes.us

Follow us:

-----Original Appointment-----

From: WIMBERLY, Ryan (EH:NORTH AMERICA)

Sent: Monday, August 05, 2019 9:45 AM

To: WIMBERLY, Ryan (EH:NORTH AMERICA); HORN, Susan (EH:Collections); Dan Ring (dring@parfunding.com); SMITH, Jasmine (EH:NORTH AMERICA); Bond, Lisa (EH:AMER);

DUNBAR, Bret (EH:AMER); Greaver, Joshua (EH:NORTH AMERICA); Ben Mannes (bmannes@parfunding.com)

Subject: CBSG / Par Funding & Euler Hermes When: Wednesday, August 07, 2019 9:00 AM-9:30 AM (UTC-05:00) Eastern Time (US & Canada). Where: (866) 344-8970, passcode 89423167 then #

Euler Hermes is the world's leading provider of trade related insurance solutions, helping companies of all sizes trade with confidence at home and abroad

Euler Hermes is a member of Allianz. www.eulerhermes.com

 -------------------------------------

This e-mail may contain confidential and/or privileged information. If you are not the intended recipient or have received this e-mail in error, notify the

Read our full e-mail disclaimer statement and monitoring policy

(http://www.eulerhermes.com/Pages/legals.aspx) before taking any action based on the contents of this e-mail.

Case 9:20-cv-81205-RAR Document 290-18 Entered on FLSD Docket 09/28/2020 Page 7 of 7