The founders of Par Funding — the Philadelphia lender called an investment scam by financial regulators — are pushing back against a demand that they pay back hundreds of millions of dollars to investors.
In a new court filing, husband and wife Joseph LaForte and Lisa McElone say they should have to pay no more than $56 million in disgorged proceeds and fines, not the $337 million being sought by the U.S. Securities and Exchange Commission.
The couple late last year dropped their opposition to a sweeping fraud civil suit filed against them by the SEC, and agreed to make payments as part of a settlement. But a federal judge hasn’t yet determined the amount and the two sides are going back and forth before he rules.
In their filing late Friday LaForte and McElone consistently sought to minimize accusations against them. “This is, at worst, a disclosure case; not a theft case,” their filing says.
It accuses the SEC of making a “series of inflammatory statements and overreaching demands that are factually inaccurate and equitably unsupportable.”
The SEC has contended in its civil case filed in 2020 that LaForte, his wife, others principals, and a group of financial pitchmen raised $540 million from 1,200 investors by hiding — from those investors, regulators and even Par’s own lawyer — that LaForte had twice served time for financial crimes and used aliases to disguise his identity.
The agency also cited a sales pitch from him in which LaForte wrote in a text…
