Capital Factors Defraudment Settlement

Boca Raton based Capital Factors has settled with one of its customers in a suit in which the company accused several customers of cheating them out of millions of dollars through fake transactions. The customer, Whitehall Jewellers, a company based out of Chicago, settled with Capital Factors for $10.8 million for its part. Another customer and defendant in the suit, Cosmopolitan Gems, has been ordered by a judge in New York to pay $32 million. Because Cosmopolitan Gems is now defunct, the bill goes to its former president, Joshua Kestenbaum, who may be unable to pay the vast amount owed. The company which owns Capital Factors, Regions Financial Corp., are rumoured to be looking to sell Capital after the lawsuit is entirely settled. A spokesman for Regions said that they were "doing an in-depth analysis of Capital Factors to determine how to maximise its value". Capital Factors only makes a small portion of Regions Financial's assets, which are all together around $81 billion. (Oct-15-04) [SOUTH FLORIDA BUSINESS JOURNAL]

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