Pacific National Capital Ocean Pacific Capital Just Be Cautious Irvine California

After submitting my initial Rip-Off report about Mark Hasegawa and Pacific National Capital, I did further research on them and discovered Mr. Hasegawa and Pacific National Capital are both currently being sued for fraud, conspiracy to defraud, breach of contract, and negligence in U.S. Federal Court, District of Kansas, Case No. 16-1432 by Watchous Enterprises, LLC – for exactly the kind of fishy misconduct that my initial report expressed concerns about.

Here are the allegations in that case:   Watchous paid Pacific National Capital a $12,600 upfront  fee to broker financing (sound familiar?).   Pacific National Capital then introduced Watchous to a shady entity named Waterfall Mountain Group headed by William J. Mournes.  Pacific represented to Watchous that it had conducted business with Waterfall, including successfully closing numerous prior financial transactions.  However, unknown to Watchous, Mournes had been involved in prior lawsuits where adverse parties contended that Mournes misled them.  One court found that Mournes had “disastrous credit and judgment histories” and was “adept…in devising complex methods to obfuscate [his] transactions.” Titan Management, L.P. et al. v. James J. Licata, et al., Trial Superior Court of New Jersey, Docket No. L-7709-13, Trial Court Opinion, June 2, 2015.”  Watchous was asked by Waterfall to submit a $175,000 deposit to Waterfall in anticipation of getting an $80 million loan from Waterfall that never materialized and Waterfall kept their $175,000 deposit.  Pacific National Capital client's received no financing, the client got fleeced of $175,000 from the crooked company introduced to them by Pacific National Capital, and Pacific National Capital kept the $12,600 upfront fee ($187,600 losses in total).  It is alleged that Pacific National Capital was in cahoots with Waterfall and was fully aware of Waterfall's money problems as revealed by several email exchanges discovered at Pacific National Capital, and that Pacific National Capital was instrumental in helping Waterfall obtain the deposit from Watchous knowingly and fraudulently (comment -- so much for  Pacific National Capital's "due diligence").

In April 2017, the parties entered into a legal agreement to settle the case that stipulated that Pacific National Capital and Waterfall were to pay back both the deposit and upfront fee with interest.  Howver, on May 19, 2017, Pacific National Capital and Waterfall failed to make the settlement. payment  So, let's see -- after their client got fleeced, they agreed to a bogus settlement in Federal Court, and then welched on that settlement.  Not good.

Question:  If the above facts are true (look up this case) -- is Pacific National Capital the kind of company you want to do business with?  You be the judge.

I tried to supplement my initial Ripoff Complaint earlier with above information about the Watchous lawsuit but the initial complaint cannot be edited once submitted.  However, thanks to Mr. Hasegawa’s rebuttal, I can now bring this important case to light.

Mark’s rebuttal to my Ripoff Complaint states that he received my email asking him for references – and that he RESPONDED TO IT.  The latter is COMPLETELY UNTRUE.  I never received a response even after leaving him voicemail, email, and reaching out to his agent Jeanine Bellandir.   If Mark had replied to me as he claims, then let him post that email for all to see, since such a statement can be easily verified.  Making such boldly false public statements raises even more red flags in my mind about both him and this highly-suspect company.

The fact that Mr. Hasegawa in his rebuttal brought up a lawsuit I am involved in that is totally unrelated to this transaction – in an obvious attempt to discredit my initial Ripoff report -- shows me how far he is willing to go to attempt to deflect statements about his organization.  It is true that my former employer has filed a “trade secret” claim against me in retaliation after I left and several of my financial-planning clients decided to follow me out the door.  Clients are free to choose their own financial planner but since there were no “trade secrets” misappropriated, I have countersued and denied these false allegations in full.   Unfortunately for Pacific National Capital, my ongoing legal dispute with my former employer is not at issue here – but Pacific National Capital’s business practices are very much question.  Mark wrote in his rebuttal that I "have enough problems of my own to handle."  However, judging from the looks of that federal fraud lawsuit, I would have to say the same for you, Mark.

When I submitted my initial report advising “caution” and expressing suspicion about Pacific National Capital, I was communicating what was essentially avague, gut feeling but after learning about Watchous’ fraud claim in federal court and reflecting further on my own experiences, I would now unequivocally advise, in the strongest possible terms, AGAINST anyone paying Pacific National Capital’s $7,600 “upfront fee.”  I think what Pacific National Capital is doing – collecting a non-refundable upfront brokers fee even before they obtain any financing for the client  – should be illegal, if it’s not already illegal.  Brokers don’t get paid until they close the deal, period end of story.  Therefore, Pacific National Capital shouldn’t be collecting a fee BEFORE financing is –actually- secured.   Assuming they even have access to real or legitimate financing sources,  Pacific National Capital’s role as a broker/middle-man  doesn’t obligate them to do anything after receiving the upfront fee, since they’ve already been paid.  They are careful not to call it a “brokers fee” but instead referring to it as “due diligence” cost to try to sidestep any broker obligations.

Imagine paying your real estate agent before any real estate deal is done (just for the agent doing “due diligence) and the agent has no further obligation after being paid –  how much sense doesthat make?  It’s exactly what’s happening here – and it’s not a good deal for the client.

I believe this kind of upfront fee arrangement preys on unsuspecting borrowers who may be out of options or who are unaware of broker rules and conventions.  Because of the upfront fee, naïve or unsophisticated applicants can be easily cajoled into paying the $7,600 fee in hopes that Pacific National Capital will help get them financing -- especially for deals Pacific National Capital “pitches” that are too good to be true.  I recall them dangling the possibility of “100% financing” for $35 million with NO MONEY DOWN -- an unheard-of type of deal -- but first, I needed to pay the upfront “due diligence” fee to see “if we qualified.”  Excuse me, you’ll have to forgive me but my initial reaction was one of deep, deep skepticism....

Mark told us an elaborate story about Pacific National Capital’s “connections” with a variety of exotic finance sources from ex-CIA operatives to Chinese financiers, without mentioning the names of real companies.  Their websites shows dozens of supposedly-completed transactions in the tens and hundreds of millions of dollars –  but without mentioning any names or specifics.   I found it highly suspicious that all “due diligence” would cost the same amount ($7,600) regardless of the size of the proposal.   I note that the amount of $7,600 is under the $10,000 threshold, making it a small claims case and harder to recover.  They also wanted us to sign a “non-exclusivity” which appeared to us as little more than a CYA tactic to protect them if anyone should anyone protest being declined for financing after paying $7,600 upfront fee.

I am looking into contacting the California Attorney General’s Office to report this shady business practice, as the California business code regulates lending and brokers of every kind, and that Pacific National Capital are acting as de facto brokers.  I do not believe the state of California would look favorably upon this type of very peculiar fee arrangement and after reading Mark Hasegawa’s rebuttal, I am more concerned than ever about the legitimacy of this outfit. My view is that this company is as phony as a $3 dollar bill and I would never even think of doing business with them.  As you can see, those are some serious malfeasance charges outlined in that Federal fraud lawsuit.

We were introduced to the poster of this report, Steven P. McCormick, J.D. of McCormick Estate and Wealth Planning and In-House Legal Counsel for Applied Gas Lift, LLC in Simi Valley, CA and his partners Michael Palasch and Scott Haydel by a broker, Jeannie to discuss their oil project in Louisiana on or around August 10th, 2017.

We reviewed the information provided and on August 17th we had a positive phone discussion with Steve regarding the project where we discussed questions we had about the project, our history and how our process works.  As part of the discussions we explained that if the fund had an interest, we would engage them on a non-exclusive fee agreement and the fund will be spending upwards of $30,000 on their own due diligence, ie. geology review, title review, site visits, legal costs, etc. and all we ask is that the client cover $7,600 for underwriting and processing and any of their own costs related to the process such as paying any of their own technical staff for their time, travel costs and legal expenses; a small commitment to the process considering Steve and his group was looking for our fund to put up 100% of an estimated $35 million or more required to acquire and develop the project in question.  

On August 21 we heard through the broker that the client was uncomfortable paying for anything or unwilling/unable to pay the $7,600 and we also received an e-mail from Steve requesting references.  We did respond to that e-mail and told Steve that, “If the processing fee is really a problem, we would be glad to collect it at a later date, i.e. upon signing a commitment letter or joint venture agreement from a fund if that works for you, let us know either way.” to which we never received a response.  We never sent Steve a fee agreement, charged any fees or have any contractual engagement with his company.

We subsequently discovered an article http://norcalrecord.com/stories/511093310-wescom-financial-services-accuses-former-employee-of-breaching-confidentiality-agreement  stating that Mr. McCormick was/is being sued by Westcom Financial Services his previous employer, “alleging misappropriation of trade secrets” and solicitation of his former employer’s clients “to transfer their assets and business to his own new firm, in direct disregard of the signed confidentiality agreement.”  The nature of such allegations is exactly why we protect the identity of our clients and sources and is why his project would eventually have been a pass for us.  We were not “ripped off” by Mr. McCormick either but because he has chosen to initiate a negative post about us on this public forum, it is also our obligation to respond in kind to inform others of our side of the story and our findings about him.  His posting of a rip-off report when he was not ripped off makes no sense to us and it appears as though he has other problems of his own to handle.