Exhibit “2”

Case 9:20-cv-81205-RAR Document 482-2 Entered on FLSD Docket 02/01/2021 Page 1 of 21
UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF FLORIDA

SECURITIES AND EXCHANGE COMMISSION,

v. CASE NO.: 20-cv-81205-RAR

COMPLETE BUSINESS SOLUTIONS GROUP,

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

Defendants.

DECLARATION OF BRADLEY D. SHARP

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

1. My name is Bradley D Sharp. I am over twenty-one years of age and have 

personal knowledge of the matters set forth herein.

2. I am CEO of Development Specialists, Inc., the financial advisor to the 

Receiver, Ryan K. Stumphauzer.

3. I am the primary engagement manager for all matters relative to Complete 

Business Solutions Group, Inc., d/b/a Par Funding (“CBSG”) and related Receivership 

Entities.

4. I have overseen my staff’s analyses of CBSG’s books and records and have

reviewed their work. My staff includes experienced forensic accountants maintaining CPA, 

CFF and CFE certifications. 

5. This declaration will provide our preliminary findings with respect to our 

analysis of CBSG. The analysis will provide conclusions regarding the CBSG sources and 

uses of cash through 2019, an analysis of merchants that account for 50% of the receivable 

Case 9:20-cv-81205-RAR Document 482-2 Entered on FLSD Docket 02/01/2021 Page 2 of 21
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portfolio and comments with respect to the hypothetical analysis provided by the 

Defendants.

Summary of Conclusions:

6. From inception through 2019, CBSG generated only $6.6 million in cash from 

MCA Activity despite advancing $1.1 billion in MCA transactions.

7. From inception through 2019, CBSG paid more than $144 million to or for the 

benefit of LaForte, McElhone, Cole and Abbonizio (“Insiders”).

8. From inception through 2019, CBSG incurred a cash loss from operations of 

$136.2 million.

9. From inception through 2019, CBSG paid $231.0 million to investors, 

consisting of principal repayments totaling $135.6 million and interest payments totaling 

$95.4 million. CBSG could not have made these principal and interest payments to the 

investors without additional funds from the investors. 

10. A significant amount of the receivable portfolio consists of “factors,” fees and 

expense and not cash advanced.

11. It appears that many of the larger merchants have made payments to CBSG 

with funding from CBSG.

12. The Defendants hypothetical portfolio analysis in the Defendants’ Joint 

Response to the Status Report [ECF Doc No.355] is misleading and does not reflect actual 

operations at CBSG.

Cash Sources and Uses:

13. Our preliminary conclusions summarized above are based on our analysis of

CBSG’s cash sources and uses for the calendar years 2012 through 2019. In order to do 

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so, we utilized the receipts and disbursements from CBSG’s QuickBooks file which were 

then reconciled to the CBSG bank statements. The transactions were categorized based 

largely on CBSG’s accounting for each. In other words, we identified the “other side” of 

the entry for each cash receipt or disbursement. For a receipt, we identified the account to 

which the corresponding credit was recorded (e.g., Accounts Payable). For a 

disbursement, we identified the account to which the corresponding debit was recorded 

(e.g., Interest Expense). 

14. While we are confident that our analysis encompasses virtually all cash 

transactions through 2019 and reflects the nature of the transactions as accounted for by CBSG, 

this analysis should be considered preliminary as we are still researching the purpose of certain 

transactions and evaluating the transactions in 2020.

1

 

15. Attached as Exhibit A is our summary of CBSG cash sources and uses for the 

period from inception through 2019. The following chart is a high-level overview of the cash 

activity (dollars in millions):

Receipts Disbursements Net

Investors $ 479.3 $ (231.0) $ 248.3

MCA Activity 1,103.9 (1,097.3) 6.6

Operating Expenses 1.3 (27.7) (26.4)

Commissions/Consulting Fees:

To/FBO Related Entities - (77.0) (77.0)

To Other Entities - (39.4) (39.4)

Other Related Entity Activity 4.7 (72.0) (67.3)

 Totals $ 1,589.2 $ (1,544.4) $ 44.8

Category

1

. We have reviewed the analysis presented by the SEC through June 2020. Our analysis is through December 2019

and other than the scope and minor classification issues, our results are consistent with the SEC analysis.

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16. Although there were significant transactions, CBSG did not generate a positive 

cash flow:

a. CBSG had receipts of $1.1 billion including $943.0 million of payments 

from MCA clients and $160.9 million of payments relating to joint 

funding involving participations with other MCA lenders. CBSG 

disbursed $1.1 billion which included $938.3 million of advances to 

MCA clients and $159.0 million of payments relating to joint funding 

activity. Despite this level of cash transactions, CBSG generated only 

$6.6 million in net cash from MCA activity through 2019 (“MCA 

Activity”). 

b. From inception through 2019, CBSG paid $116.4 million in commissions 

and consulting fees to the following entities:

• Heritage Business Consulting (McElhone) - $37.8 million

• Eagle Six Consultants (McElhone) - $24.4 million

• New Field Ventures (Cole) - $9.9 million

• Beta Abigail (Abingozi)- $4.9 million

• All other entities combined - $39.4 million

Of this $116.4 million, $77.0 million was paid to companies controlled by 

Insiders.

c. CBSG paid net operating expenses of $26.4 million.

d. From inception through 2019, CBSG generated a negative cash flow 

from operations of $136.2 million:

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Cash from MCA Activity $6.6 million

Less:

 Commissions & consulting fees $116.4 million

 Operating expenses $26.4 million

Cash flow from operations ($136.2) million

e. In addition to the commissions and consulting fees referenced above, 

from inception through 2019, CBSG made net payments of $67.3 million 

to, or for the benefit of, Insiders and related entities

McElhone/LME Trust $40.6 million

Full Spectrum Processing $9.1 million

RMR Holdings (LaForte) $6.9 million

Eagle Union Quest (private jet) $6.2 million

Heritage Business Consulting $3.7 million

Other (combined) $0.8 million

Total Related Entity Activity $67.3 Million

f. Thus, CBSG paid a total of $144.3 million to Insiders and their related 

entities through 2019.

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g. The net cash flow from non-investor activities was negative $203.5 

million:

Cash loss from operations, which 

includes $116.4 million in 

commissions, with $77 million paid 

to Insiders

($136.2) million

Payments for the benefit of Insiders ($67.3) million

Total negative cash flow from noninvestor activities($203.5) million

17. Due to the significant negative cash flow from non-investor activities, CBSG 

required additional funds from investors in order to sustain the business and to make the 

principal and interest payments on the investor notes.

a. The cash loss of $203.5 million from non-investor activities does not 

include payments to investors for principal and interest of $231.0 

million.

b. Investors provided CBSG $479.3 million in investments and CBSG paid 

$231.0 million to investors, consisting of principal repayments totaling

$135.6 million and interest payments totaling $95.4 million.

Thus, the investors provided net cash to CBSG of $248.3 million. Given 

the cash loss of $203.5 million, CBSG could not have made the principal 

and interest payments totaling $231.0 million to the investors without the

$479.3 million in funds from the investors.

Portfolio Analysis

18. To analyze the CBSG portfolio, we conducted detailed analyses with respect to 

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a subset of the CBSG merchants. Based on our analyses, these merchant accounts 

demonstrated unusual activity, such as:

a. Outstanding balances significantly larger than supported by the financial 

information located in the CBSG books and records.

b. Significant reload activity, within the merchant and reloads across 

merchants (e.g., transferring an advance from one merchant to another).

c. Cash payments by merchants dependent on continuing advances to the 

same merchants.

d. Ownership position in certain merchants by CBSG’s affiliates and related 

parties.

19. The merchant accounts that have unusual activity have been defined as the 

Exception Portfolio. We have located 16 individual merchants demonstrating some or all of 

the above characteristics. These have been combined into 5 groups based on common 

ownership, reloads and other transactions between the merchants.

20. Our analysis of the Exception Portfolio includes the following:

a. B & T Supply Group (including B & T Supply, Lifeguard, Yanky 

Holding, YBT Industries Inc., Naki Cleaning Services, and Anglo China)

b. Colorado Homes Group (including Colorado Homes, United by ECH, 

CNP Operating, Colorado Sky, and escrow held by Dickinson Wright)

c. Kingdom Logistics

d. Big Red Express Group (including Big Red Ltl, Bulova Technologies, 

and Twiss Cold Storage)

e. National Brokers of America 

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21. Our analysis of the CBSG portfolio noted significant use of “reloads.” A 

reload is essentially CBSG refinancing a pre-existing MCA advance. The “reload” advance 

would normally fund the merchant with additional cash and repay the existing advance. The 

reload, with the “factor”, becomes the new outstanding obligation. By way of example, on 

June 27th, 2019, CBSG advanced $700,000 (and advance origination fees) to B & T Supply2

with a daily payment obligation that was scheduled to last for 154 days. CBSG added a

“factor” of $224,000 to the cash advance, creating an Outstanding Balance of $924,000. 

After payments of $53,995, on July 11th, 2019, CBSG incorporated the unpaid balance of 

$870,045 into a reload advance.

3 The terms of the reload advance agreement state “Payoff 

Existing: $870,045 Purchase Price New: $1,000,000”, which indicates that the advance paid 

off the unpaid balance of $870,045. This transaction occurred a mere two weeks after the 

initial advance with only 5.8% of the expected payback amount having been repaid. CBSG 

wired out $1,000,000 in new money (less advance origination fees) and charged an additional 

“factor” of $598,414, thereby creating a new Outstanding Balance of $2,468,459. Combined, 

through these advances, payment and reload, CBSG funded $1,700,000, charged a “factor” of 

$822,414 and created a new receivable of $2,468,459. 

22. Use of reloads escalates the obligations of the merchant as each reload adds an 

additional “factor” along with any new funds advanced. In the example above, the $870,045 

in reloaded funds is subject to the factor twice; once when the funds were originally sent and 

again when they are included in the reload advance. The use of reloads also significantly 

distorts the calculation of loss rates as the advances are simply refinanced without becoming a 

loss. Our analysis also noted the frequent use of “combination” reloads involving the 

2 Coded BAND003:19010 in CBSG’s books and records.

3 Coded BAND003:19011.

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Exception Portfolio. These types of reloads occurred when multiple prior advances were 

reloaded prior to their final payment dates into a single new advance. Some of these 

combination reloads included new funds being advanced, however others did not include any 

new funds being advanced at all. In a reload without new funds being advanced, CBSG 

would determine the total amount needed to combine the prior advances into the new 

combination advance. CBSG then applied an additional “factor” to the new combination 

advance balance resulting in a payment amount that was greater than the payments required 

under the prior, uncombined advances.

23. This practice of rolling advances into a new obligation becomes apparent when 

there is significant growth in a merchant’s obligation unrelated to its business operations. As 

demonstrated by the table that follows, a substantial, portion of the Exception Portfolio, and 

therefore the receivable as a whole, is a result of reloads and not cash advanced.

The Remainder of this Page Left Blank

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24. The following table provides a summary of the activities with respect to the 

Exception Portfolio from the inception of the relationship to November 2020:

25. Based on our analysis of the Exception Portfolio, we reached the following 

conclusions with respect to the quality of the CBSG portfolio.

a. It appears that the Exception Portfolio has excessive reloads with 84% of the 

outstanding balance made up of the “factor,” fees and expenses and not actual cash 

advanced. The majority of the advances in this portfolio have been reloaded into 

new advances, not paid in full.

b. If CBSG is only able to collect the Cash Exposure (cash out less cash back) in the 

Exception Portfolio, CBSG’s assets will decline by $165.1 million reducing the 

total accounts receivable portfolio by 42% from $391.8 million, down to $226.7 

million.

CBSG Exception Portfolio Merchant Balances and Fees

Start of 

Relationship [1] Cash Out Cash Back

Net Cash 

Exposure [2]

Net Balance 

Transferred

Outstanding Fees 

and Other Charges 

[3]

% of 

Outstanding 

Balance

Outstanding 

Balance

B & T Supply 05/15/15 50,485,491 48,567,460 1,918,030 18,838,973 57,227,914 73% 77,984,917 [4] *

Lifeguard 02/06/20 17,531,669 9,566,636 7,965,033 3,032,210 2,362,567 18% 13,359,810 [4] *

Yanky Holding Supplies 03/29/16 4,585,877 2,793,427 1,792,450 (4,805,790) 3,013,340 N/A - [5]

YBT Industries Inc 04/12/16 12,477,305 6,407,979 6,069,327 (10,845,555) 4,776,228 N/A - [5]

Naki Cleaning Services 04/12/16 6,287,403 4,182,342 2,105,061 (4,462,483) 2,357,422 N/A - [5]

Anglo China 04/27/20 1,597,595 1,597,595 (1,757,355) 159,760 N/A - [5]

B & T Group Total 92,965,340 71,517,843 21,447,497 (0) 69,897,231 77% 91,344,728

Colorado Homes 02/05/18 24,533,701 21,212,640 3,321,061 (4,252,726) 20,581,824 105% 19,650,160 [4] *

United by ECH 08/26/19 3,532,525 2,155,603 1,376,922 1,537,726 2,924,149 50% 5,838,797 *

CNP Operating 11/04/19 - 93,000 (93,000) 4,480,000 - 0% 4,387,000 [4]

Colorado Sky 02/22/19 1,200,000 1,235,000 (35,000) (445,000) 480,000 N/A - [6]

Dickinson Wright 01/30/19 1,200,000 - 1,200,000 (1,320,000) 120,000 N/A - [7]

Colorado Homes Group Total 30,466,226 24,696,243 5,769,983 0 24,105,974 81% 29,875,957

Big Red Express (Big Red Ltl) 10/10/17 5,990,665 4,941,182 1,049,483 6,176,781 11,725,988 62% 18,952,252 *

Bulova Technologies 03/26/14 5,714,985 4,905,683 809,302 (5,027,611) 4,218,309 N/A - [8]

Twiss Cold Storage 04/26/16 1,630,505 1,072,904 557,601 (1,149,169) 591,568 N/A - [9]

Big Red Express Group Total 13,336,156 10,919,769 2,416,386 0 16,535,865 87% 18,952,252

Kingdom Logistics 08/01/18 31,097,243 27,785,333 3,311,910 - 17,604,689 84% 20,916,599 *

National Brokers Of America 05/07/15 35,313,398 36,993,310 (1,679,912) - 36,973,530 105% 35,293,618 *

Grand Total $ 203,178,362 $ 171,912,498 $ 31,265,864 $ 165,117,289 84% $ 196,383,154

1. Start of Relationship is defined as the date of the first signed contract.

2. Net Cash Exposure is defined as Cash Out minus Cash Back.

3. Outstanding Fees and Other Charges is defined as Outstanding Balance less Net Cash Exposure.

4. Outstanding Balance includes reloads from entities not currently listed here.

5. Entity reloaded outstanding advances into B&T Supply and/or Lifeguard and does not currently have an outstanding balance

6. Entity reloaded outstanding advances into CNP Operating and does not currently have an outstanding balance

7. Entity reloaded outstanding advances into Colorado Sky and does not currently have an outstanding balance

8. Entity reloaded outstanding advances into Big Red Express and does not currently have an outstanding balance

9. Entity reloaded outstanding advances into Bulova Technologies and does not currently have an outstanding balance

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c. The CBSG portfolio is highly concentrated with the 16 merchants in 5 related 

groups in the Exception Portfolio representing more than 50% of the total $391.8 

million accounts receivable on the books of CBSG. 

d. Based on the data reviewed to date on several merchants in the Exception Portfolio, 

it appears that the payments received by CBSG were a result of funds actually 

advanced by CBSG to the merchant. In other words, the funds advanced by CBSG 

to the merchants made a “round trip” back to CBSG to meet the required payments.

e. Since March 2014, the cumulative amount collected from the above 16 merchants 

(“Cash Back”) is $31.3 million less than the Net Advanced, or “Cash Out” amount 

in the above table. In other words, for these 16 merchants, representing more than

50% of the portfolio, CBSG has advanced $31.3 million more in cash than it has 

received.

26. The following charts show a timeline of Total Funding and Payment activities 

of the Exception Portfolio, by month and cumulatively:

 -

 2,000,000

 4,000,000

 6,000,000

 8,000,000

 10,000,000

 12,000,000

 14,000,000

Exception Portfolio Group Funding and Payments

Funding Payment

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27. As is clear in the second graph above, throughout its relationship with these 

merchants, the payments received by CBSG never exceeded the amount advanced to these 

merchants, let alone return a profit. In our analysis, this gap between Cash Out and Cash In 

has not shown any sign of narrowing on an aggregate basis.

The Exception Merchants

B & T Supply Group:

28. Funding to and payments by B & T Supply Group, by month and 

cumulatively:

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

Mar-14

May-14

Jul-14

Sep-14

Nov-14

Jan-15

Mar-15

May-15

Jul-15

Sep-15

Nov-15

Jan-16

Mar-16

May-16

Jul-16

Sep-16

Nov-16

Jan-17

Mar-17

May-17

Jul-17

Sep-17

Nov-17

Jan-18

Mar-18

May-18

Jul-18

Sep-18

Nov-18

Jan-19

Mar-19

May-19

Jul-19

Sep-19

Nov-19

Jan-20

Mar-20

May-20

Jul-20

Sep-20

Exception Portfolio Group Cumulative

Funding Payment

 -

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

 7,000,000

B & T Fundings and Payments

Funding Payment

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29. As illustrated above, the cash funding to the B&T Supply Group exceeds the 

cash repaid by more than $21.4 million with a total outstanding balance due of more than $91 

million, consisting primarily of the “factor”, fees and expenses. 

30. The documents in the files of CBSG with respect to this merchant do not 

support credit exposure of more than $20 million and certainly not more than $90 million. 

CBSG’s own Underwriting Profile dated May 12, 2015 recommended a credit limit of 

$27,600. There is no information in the CBSG books and records with respect to the other 

B&T related entities although these entities received advances.

31. The only financial information we have located with respect to this merchant 

are 20 bank statements for 3 different accounts from 2015 and 2017. When combined, the 

monthly average balance on these accounts does not exceed $1 million. From January to 

June 2020, CBSG funded a monthly average of $5.3 million to the B&T entities and received 

average monthly payments of only $4.3 million.

32. Based on this information, it appears that this merchant has been making its 

payments to CBSG with funding provided by CBSG.

33. B&T has engaged counsel and its counsel has disputed the amount owed. 

 -

 10,000,000

 20,000,000

 30,000,000

 40,000,000

 50,000,000

 60,000,000

 70,000,000

 80,000,000

 90,000,000

 100,000,000

B&T Group Cumulative

Funding Payment

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Colorado Homes:

34. Funding to and payments by Colorado Homes Group, by month and 

cumulatively:

35. The last funding to the Colorado Homes Group was $5.2 million in December 

2019. 

36. Since funding ceased, the Colorado Homes Group has only repaid $297,000. 

The funding and payment pattern with Colorado Homes is similar to that with B&T. 

Colorado Homes has been advanced more cash than it has repaid and appears to have been 

making payments with funding provided by CBSG.

37. Colorado Homes has engaged counsel and has disputed the amount owed. 

Colorado Homes has stated that the insiders of Par Funding, specifically entities owned by 

Lisa McElhone, are not fulfilling funding commitments.

 -

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

Colorado Homes Group Funding and Payments

Fundings Payments

 -

 5,000,000

 10,000,000

 15,000,000

 20,000,000

 25,000,000

 30,000,000

 35,000,000

Colorado Homes Group Cumulative

Funding Payments

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Kingdom Logistics:

38. Funding to and Payments by Kingdom Logistics, by month and cumulatively:

39. As illustrated above, CBSG’s cash funding to Kingdom Logistics exceeds the 

cash repaid by $3.3 million with a total outstanding balance due of more than $20.9 million.

This total outstanding balance is comprised primarily of “factor,” fees and expenses. CBSG 

last funded this merchant with $3.0 million$937 thousand in August 2019May 2020. The 

merchant made payments of $12,000 per day until September 28, 2020, when it closed its 

bank account funding the payments. 

40. Anthony Zingarelli, a former contractor for CBSG and an associate of Joe 

LaForte purports to speak for Kingdom Logistics. We have demanded a resumption of 

payments but have not received a response.

Big Red Express:

41. Funding to and payments by Big Red Express Group, by month and 

 -

 1,000,000

 2,000,000

 3,000,000

 4,000,000

 5,000,000

 6,000,000

 7,000,000

Kingdom Logistics Funding and Payments

Funding Payment

 -

 5,000,000

 10,000,000

 15,000,000

 20,000,000

 25,000,000

 30,000,000

 35,000,000

Kingdom Logistics Cumulative

Funding Payment

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cumulatively:

42. Based on the cash funding and payment history, it appears that Big Red was 

only able to make payments to CBSG with funding from CBSG. Prior to the Receivership, 

CBSG filed a confession of judgment against Big Red for $20,875,197.06 in state court in 

Pennsylvania. The estate of Big Red’s owner has also filed suit in Pennsylvania state court 

alleging forgery and fraud in CBSG’s dealings with Big Red.

National Brokers of America:

43. Funding to and payments by National Brokers of America, by month and 

cumulatively:

 -

 2,000,000

 4,000,000

 6,000,000

 8,000,000

 10,000,000

 12,000,000

 14,000,000

 16,000,000

Mar-14

May-14

Jul-14

Sep-14

Nov-14

Jan-15

Mar-15

May-15

Jul-15

Sep-15

Nov-15

Jan-16

Mar-16

May-16

Jul-16

Sep-16

Nov-16

Jan-17

Mar-17

May-17

Jul-17

Sep-17

Nov-17

Jan-18

Mar-18

May-18

Jul-18

Sep-18

Nov-18

Jan-19

Mar-19

May-19

Jul-19

Sep-19

Nov-19

Jan-20

Mar-20

May-20

Jul-20

Sep-20

Big Red Express Group Cumulative

Funding Payment

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44. National Brokers of America is the only merchant in the Exception Portfolio to 

repay the amount of cash advanced. CBSG advanced $35.3 million since May 2015 and was 

repaid $36.7 million. However, the Outstanding Balance is still $35.4 million, consisting 

exclusively of the “factor,” fees and expenses. The five-year cumulative net cash inflow of 

$1.4 million is only 4.76% of total amount advanced. Considering the time value of money

and CBSG’s own cost of capital, National Brokers of America is not a source of profit for 

CBSG. 

45. CBSG’s most recent merchant agreement lists an entity, National Brokers of 

America LLC with a D/B/A of Bene Markets LLC. The original party to the merchant 

agreements, National Brokers of America, Inc. filed a Chapter 7 Bankruptcy on September 7, 

2019 (Case No. 19-15488, Eastern District of Pennsylvania). There is also no listing of any 

debts owed to CBSG in the bankruptcy filings and no reference of Bene Markets LLC. 

 -

 500,000

 1,000,000

 1,500,000

 2,000,000

 2,500,000

 3,000,000

 3,500,000

 4,000,000

 4,500,000

 5,000,000

National Brokers of America Funding and Payment

Funding Payment

 -

 5,000,000

 10,000,000

 15,000,000

 20,000,000

 25,000,000

 30,000,000

 35,000,000

 40,000,000

National Brokers of America Cumulative

Funding Payment

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46. The most recent credit report in the files of CBSG for National Brokers of 

America LLC in October 2018 estimates annual sales of in the range of $1 to $499,000 and 

reported a credit limit recommendation of $1,900. 

Par Financial Model

47. As a part of the analysis discussed above, I have reviewed Defendants’ Joint 

Response to the Status Report [ECF Doc No.355]. Based on my analysis of the operations of 

CBSG, the Joint Response is misleading.

48. For instance, Defendants present a table assuming three hypothetical MCA 

deals. However, this table assumes that Par collects all the amount due with a factor of 1.32. 

Based on our experience with the Exception Portfolio, which represents more than 50% of the 

total Accounts Receivable, Par has only collected 86% of the actual cash Funding, not 132%. 

In order to continue with the same level of Funding for Deal 2 and Deal 3 as indicated in the 

table, Par would need to raise additional investor funds. 

49. To restate the table presented in the pleading based on actual results:

Deal 1 Deal 2 Deal 3 

Funding $100,000.00 $132,000.00 $174,240.00 

Factor

 

1.32 

 

1.32 

 

1.32 

Collected (86% of funding) $86,000.00 $113,520.00 $149,846.40 

New Investor Money Required $14,000.00 $18,480.00 $24,393.60 

Initial Outstanding Balance $132,000.00 $174,240.00 $229,996.80 

Remaining Outstanding Balance $46,000.00 $60,720.00 $80,150.40 

50. The New Investor Money Required represents additional cash above the 

amount collected required to fund the next Deal as illustrated below:

Case 9:20-cv-81205-RAR Document 482-2 Entered on FLSD Docket 02/01/2021 Page 19 of

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Funding $100,000.00 $132,000.00 $174,240.00 

Previous Cash Collected $86,000.00 $113,520.00 

New Investor Money Required $100,000.00 $46,000.00 $60,720.00 

51. CBSG’s requirement for new investor money in the example above does not 

include additional cash needs for expenditures such as:

a. Interest paid to investors ($51.7 million in 2019) 

b. Operating expenses ($7.7 million in 2019) 

c. “Consulting fees” previously paid to the Par insiders equal to 10% of the 

Funding Amount ($77.0 million). 

52. When these factors are considered, CBSG’s need for new investor funding 

would be substantially higher. 

53. Based on our review to date, it is apparent that CBSG would not have been 

able to continue to provide payments to investors, or to continue to operate, without 

additional funds from investors. 

I declare under penalty of perjury that the foregoing is true, correct, and made in good faith. 

Executed this 13th day of December 20201st day of February 2021 in San Juan Capistrano, 

California

 

 ______________________________ 

 Bradley D. Sharp 

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Complete Business Solutions Group, Inc. d/b/a Par Funding, et al.

Summary of Cash Sources and Uses for the Period 2012 through 2019 ($ in Millions)

2012 2013 2014 2015 2016 2017 2018 2019 Total

Beginning Cash Balance -$ -$ 0.1$ 0.2$ 0.7$ 2.3$ 10.3$ 10.2$ -$ 

Investor Activity

Receipts from Investors 1.8 2.3 2.3 4.1 24.0 73.1 114.9 256.8 479.3 

Disbursements to Investors

Principal Repayments (0.1) (0.3) (1.7) (2.1) (1.5) (3.6) (38.9) (87.4) (135.6) 

Interest Payments (0.1) (0.7) (1.3) (1.4) (3.0) (10.2) (27.0) (51.7) (95.4) 

Total Disbursements to Investors (0.2) (1.0) (3.0) (3.5) (4.5) (13.8) (65.9) (139.1) (231.0) 

Net Investor Activity 1.6 1.3 (0.7) 0.6 19.5 59.3 49.0 117.7 248.3 

MCA Activity

Advances to Merchants (2.3) (9.3) (17.3) (28.6) (63.1) (159.1) (290.3) (368.3) (938.3) 

Payments from Merchants 1.1 9.6 20.5 32.2 61.7 149.8 291.1 377.0 943.0 

Joint Funding Net Activity - - (0.3) (0.4) (4.8) (2.5) 14.4 (4.5) 1.9 

Net MCA Activity (1.2) 0.3 2.9 3.2 (6.2) (11.8) 15.2 4.2 6.6 

Operating Expenses (0.3) (0.9) (1.2) (1.7) (2.3) (3.0) (9.3) (7.7) (26.4) 

Commissions/Consulting Fees

To/FBO Related Entities

Heritage Business Consulting - - (0.2) (0.7) (3.6) (19.2) (12.7) (1.4) (37.8) 

Eagle Six Consultants - - - - - - (8.2) (16.2) (24.4) 

New Field Ventures - - - - - (2.4) (2.9) (4.6) (9.9) 

Beta Abigail - - - - (0.3) (1.4) (2.1) (1.1) (4.9) 

Total To/FBO Related Entities - - (0.2) (0.7) (3.9) (23.0) (25.9) (23.3) (77.0) 

To Other Entities (0.1) (0.6) (0.6) (0.4) (3.4) (8.0) (10.8) (15.5) (39.4) 

Total Commissions/Consulting Fees (0.1) (0.6) (0.8) (1.1) (7.3) (31.0) (36.7) (38.8) (116.4) 

Other Related Entity Activity [1]

McElhone/LME Trust - - - (0.1) (0.4) (0.7) (14.4) (25.0) (40.6) 

Full Spectrum Processing - - - - - (1.0) (3.1) (5.0) (9.1) 

RMR Holdings - 0.1 - (0.3) (1.6) (2.0) (0.7) (2.4) (6.9) 

Eagle Union Quest - - - - - - - (6.2) (6.2) 

Heritage Business Consulting - - - - (0.1) (1.3) - (2.3) (3.7) 

Other - (0.1) (0.1) (0.1) - (0.5) (0.1) 0.1 (0.8) 

Total Related Entity Activity - - (0.1) (0.5) (2.1) (5.5) (18.3) (40.8) (67.3) 

Ending Cash Balance -$ 0.1$ 0.2$ 0.7$ 2.3$ 10.3$ 10.2$ 44.8$ 44.8$ 

[1] The other related entity activity reflects the beneficiary of the cash receipts and disbursements as reflected in CBSG's accounting records, and

not necessarily the payer or payee. For example, in 2019, there were several disbursements to First Platinum Abstract LLC apparently

relating to McElhone properties, as well disbursements to Eagle Six Consultants. CBSG booked these disbursements as distributions to LME

2017 Family Trust. Therefore, those transactions are reflected in the McElhone/LME Trust line item.

Prepared by Developments Specialists, Inc.

Preliminary and Subject to Change

Exhibit A

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