CloudFund is not a company with a mixed record. It is a company that the New York Attorney General sued in 2024 as part of an enforcement action alleging fraud, illegal loan practices, and a scheme that extracted money from more than eighteen thousand small businesses across the country. That context belongs in the first sentence of any honest account of this funder.
CloudFund operates as a successor entity to Yellowstone Capital, one of the most frequently litigated MCA funders in the country. The Yellowstone Capital settlement with the New York Attorney General produced a judgment exceeding one billion dollars, covering a range of deceptive practices including false representations about flexible repayment terms and collection of fixed debits regardless of actual business performance. CloudFund and its affiliate Delta Bridge were not covered by that settlement and continue to litigate.
The Suffern Network
The entities associated with what prosecutors described as a predatory lending network, Yellowstone Capital, Fundry, Delta Bridge, and CloudFund, share operational connections in Suffern, New York. When CloudFund extends an advance to a small business, that business is dealing with an organization that regulators have characterized as structurally fraudulent, not merely poorly reviewed.
In Rockland County, courts are now in the process of vacating hundreds of judgments that CloudFund and related entities obtained through proceedings where default was declared under terms the Attorney General has argued were fraudulently represented. The vacatur process, still ongoing in early 2025, means that judgments that appeared final are not necessarily so.
Seven Problems Documented in the Record
1. Flexible repayment terms that were not actually flexible. CloudFund representatives told business owners that repayment would adjust with revenue. The actual contract terms, and the actual debit schedule, were fixed. The Attorney General’s action characterized this gap as fraud.
2. Repayment timelines compressed beyond what contracts described. Business owners who expected repayment periods measured in months received accelerated debit schedules that extracted the full repayment amount within sixty to ninety days, regardless of what the agreement appeared to provide. The acceleration was not disclosed at origination.
3. Effective interest rates that exceeded state criminal thresholds. The rates applied in the Yellowstone and CloudFund advances that formed the basis for the Attorney General’s action reached, in documented cases, multiples of the interest rate that would trigger criminal usury under New York law. Rates that a court described as reaching eight hundred twenty percent annually were part of the factual record.
4. Default judgments obtained in New York against out-of-state businesses. CloudFund filed suits in New York courts against businesses located across the country. Defendants who could not appear and defend received default judgments that were then domesticated and enforced in their home states. In early 2025, a Rockland County court began vacating these judgments in volume, based on procedural and substantive deficiencies in the underlying actions.
“We never knew there was a lawsuit. The first we heard about it was a letter from a bank saying our account had been levied. By then the judgment had been final for eight months.”
5. Accounts frozen without notice as standard collection procedure. Bank account levies following default judgments were executed without advance notice to the business owner. The levy immobilized operating accounts, creating immediate crises for payroll, vendor obligations, and ongoing operations. The freeze preceded any outreach offering the business owner an opportunity to respond.
6. Personal guarantee enforcement against closed businesses. Business owners who closed operations after being unable to sustain CloudFund payments faced personal collection action. The personal guarantee was written broadly, and the company’s collection conduct did not distinguish between businesses that had assets and those that did not. The pursuit of individuals after business closure was reported as systematic.
7. Continued operation despite regulatory action. Unlike Yellowstone Capital, which settled, CloudFund and Delta Bridge have continued operating while defending against the Attorney General’s claims. Business owners dealing with these entities in 2025 are dealing with funders operating under active litigation by their state’s chief law enforcement officer.
The Vacatur Proceedings and What They Mean
The Rockland County court proceedings to vacate existing CloudFund judgments are significant for two reasons. They establish that judgments once considered final can be reopened, and they create a procedural pathway that attorneys representing affected businesses can pursue in parallel with other defenses.
A business owner who received a default judgment from CloudFund or a Yellowstone-related entity, even years ago, should not assume the judgment is beyond challenge. The scale of the vacatur proceedings suggests that the infirmities were structural rather than case-specific.
Addressing a CloudFund Problem
The legal response to a CloudFund advance or judgment requires addressing several questions in parallel: whether the underlying agreement was fraudulently represented, whether the acceleration was contractually authorized, whether the judgment was properly obtained, and whether the collection conduct violated state or federal law.
Each question is a separate potential basis for relief. An attorney familiar with the Yellowstone-CloudFund litigation record is positioned to move quickly, because the precedent established in the Attorney General’s proceedings reduces the amount of foundational work that would be required in a case against a less-litigated funder.
Consultation is where this conversation begins. The CloudFund fact pattern is documented in public court records, and the defenses are not speculative.
