Business owner warns about debt restructuring scam

Pacific Beach Vinyl owners says he lost thousands
Posted at 9:43 AM, Mar 11, 2018
and last updated 2018-03-11 12:49:32-04

SAN DIEGO (KGTV) - A local business owner is warning others about a phony debt restructuring company that he said cost him thousands of dollars.

Hugh Herrera owns Pacific Beach Vinyl.

"What we're selling is music, which is one of the uplifting things of life," Herrera said.

A couple years ago, Herrera needed help managing his debt with the business. After a situation with a lender, he eventually turned to what he thought was a legitimate debt restructuring company. He received a solicitation in the mail and gave the company a call.

"It sounded like something viable to me," Herrera said.

He started working with Corporate Restructure, Inc. He said he paid about $450 a week.

"In the end, the net result, we'd pay about half of whatever we owed through making weekly payments to this firm," Herrera said.  

Instead, Herrera said Corporate Restructure took about $10,000 and ran.

"They just disappeared. Couldn't get a hold of them," Herrera said.

According to news releases from the Department of Justice in New York, the men behind Corporate restructure faced dozens of charges related to bank and mail fraud. The news release dated late last year said there were approximately 200 victims that lost a total of $1.2 million.

"Somebody should really look out for predatory-type people, obviously, because that's what happened to us," Herrera said.

He is now working to pay off his existing debt after he learned an expensive lesson.

"Things are looking better. Light at the end of the tunnel," Herrera said.

Herrera started a GoFundMe campaign, which has helped keep the business afloat. He has hopes of getting some of his money back after the criminal proceedings in his case are finished.

The Federal Trade Commission recommends people to contact creditors directly for assistance with debt. It also recommends seeing a local credit union or college for more resources. Consumers can also check out a business through the Attorney General's website.