November 10, 2011
Loan broker accused of bilking veterinarians now sells wellness plans
By: Jim Downing
For The VIN News Service
Ron Paterson’s trail of unhappy customers now extends to his recent ventures in pet wellness plans and patient finance programs.
Paterson, a Southern California businessman who sells financial services to veterinary practices, was the subject of a Veterinary Information Network (VIN) News Service investigative report in June. That article detailed complaints from veterinarians about Paterson’s practice loan business, VetFinance Group, and summarized his legal history. Among other troubles, Paterson has had at least six fraud or breach of contract judgments against him since 2005, totaling more than $890,000. Three of these judgments, for a combined $140,719, are tied to veterinary-equipment deals.
Since the publication in June of the story, the VIN News Service has learned that Paterson created three new companies this year. The first two, My Pet Wellness Plan, which offered wellness plans, and VetOne, a patient finance service, apparently shut down this summer following complaints from veterinarians and inquiries by an Atlanta-area sheriff’s department. The third, Pet Wellness USA, was launched in late August. (Paterson's VetOne is not the same business as the veterinary product supplier VetOne.)
Paterson did not respond to multiple calls and emails seeking comment for this story. Posts on an anonymous blog created in July contend that Paterson has a good record as a loan broker and that the VIN News Service article focused unfairly on concerns of dissatisfied clients. The VIN News Service has found no record of a veterinarian suing Paterson in connection with his loan brokerage, pet wellness or patient finance businesses, although he has been sued successfully by veterinary equipment suppliers at least three times.
Paterson announced the opening of My Pet Wellness Plan and VetOne in February on his blog. By March, he had produced promotional videos and placed them on a number of pet-related websites. By May, Paterson had hired sales representatives and was selling plans to veterinary practices.
Dr. Gerald Skees, a veterinarian in Woodstock, Ga., signed up his practice for Paterson's wellness and patient finance programs, paying a $399 initiation fee. Four of Skees' clients then chose to enroll in one or the other of the plans.
According to the wellness-plan agreement, clients were to pay Paterson a fixed monthly fee that would cover regular veterinary care for a year. With the patient finance plan, clients would make monthly payments to Paterson to pay off a costly procedure over time. For both plans, Skees was promised an upfront payment equal to the clients' total scheduled payments to Paterson less his service and finance charge of roughly 30 percent. The upfront sum was to be provided within 72 hours of a client signing up for the service.
After 10 days passed without receiving the promised payments, Skees began to worry. His receptionist called Paterson, who promised that the money was on its way. At the same time, according to Tracy Parsons, who was hired in May as the My Pet Wellness Plan sales representative in the Atlanta area, two other local veterinarians also reported delayed payments. Moreover, Parsons wasn't getting paid by Paterson for her work.
Then, Parsons said, she read the VIN News Service article on Paterson and decided to report him to her local sheriff's department.
"Lo and behold, within a day or two, we received all our money," Skees said.
Parsons said she then broke off contact with Paterson on the advice of law enforcement officials. Cherokee County Sheriff's Department Detective Jeff Donley said Paterson’s business appeared suspicious and, after a preliminary investigation, Donley advised Skees and the two other Atlanta-area veterinarians to withdraw from Paterson’s program. Skees said his clients received all the veterinary care they had paid for.
Skees has had no contact with Paterson since late June. But today he confirmed with his bank that Paterson made an unauthorized $399 electronic withdrawal in October from one of Skees' practice accounts. Skees had provided Paterson information about the account during the process of enrolling in the wellness plan. Skees said he is pursuing the matter with local authorities.
"Before this, I could maybe give him the benefit of the doubt," Skees said. "But for him to come back and tap into my account — that's pure fraud."
Donley said he has not received complaints about Paterson from other veterinarians. Law enforcement officials in California, where Paterson previously had legal trouble, showed little interest in working with him on the investigation, Donley said.
In Orange, Calif., Dr. Richard Dahlem signed up for Paterson's patient finance program in response to an advertisement faxed to his practice. Dahlem was wary of Paterson: "He said he had a $100-million line of credit with a bank in Chicago — but when I asked him which bank, he hemmed and hawed and never did say," Dahlem recalled.
Despite his reservations, Dahlem paid the $399 enrollment fee and shortly thereafter used the program to help a patient finance a $1,150 procedure. Under the finance arrangement, Paterson was to send Dahlem $700 within 72 hours. A month later, after six follow-up calls to Paterson, the money finally arrived. Around the same time, Dahlem read the VIN News Service article on Paterson. When Paterson next called to encourage Dahlem to enroll in his wellness plan, Dahlem told him about the article and said that their business relationship was over. Paterson was furious, Dahlem recalled.
Referring to the online professional community that is the parent of the news service, Dahlem said: "He was calling VIN names, saying how he was going to take VIN to court, that it was all lies and misunderstandings. He's a lot of hot air, frankly."
Back in Cherokee County, Georgia, Donley’s investigation has not led to charges filed against Paterson. However, the My Pet Wellness Plan website has been taken down. The home page of the VetOne site remains up, but the links do not work and no telephone number is listed.
In late August, Paterson started Pet Wellness USA. This time, however, Paterson didn't trumpet his connection to the new company. On Aug. 24, a link to the Pet Wellness USA website was posted on the My Pet Wellness Plan Facebook page by a user named RJ Pearson. The same day, VetFusion Inc., which is identified as the corporate name of Pet Wellness USA on the company's website, filed as a business entity with the Nevada Secretary of State. VetFusion still has not filed a list of officers, which means that no names are associated with the firm in the public record and its Nevada business registration is officially in default. However, a Pet Wellness USA representative who answered the company's toll-free telephone number stated that it is run by Ron Paterson.
The VIN News Service was unable to find any veterinarians who have done business with Pet Wellness USA.
The experiences with Paterson related by Dahlem, Parsons and Skees — late payments or no payments, accompanied by many excuses — are similar to those connected to his loan brokerage that were detailed in the first VIN News Service article and in complaints by veterinarians posted on VIN message boards.
Since the publication of the earlier story, the list of court judgments against Paterson has grown.
In July, he settled for $58,600 a complaint from Idexx Laboratories Inc. related to a fraudulent veterinary equipment transaction. In August, a Virginia man was awarded $56,660 by an Orange County, Calif., court for a canceled loan deal with Paterson related to the purchase of an Adam & Eve sex toy franchise. The VIN News Service also identified a judgment from 2009 against Paterson for $33,175 related to non-payments for veterinary equipment supplied by Dan Scott & Associates in Westerfield, Ohio.
These judgments are on top of the more than $750,000 in awards described in June by the VIN News Service. In addition, the Anaheim, Calif., Police Department is continuing to investigate Paterson's involvement in the disappearance of $9,000 in funds raised by a local Pop Warner football league.
The fate of Paterson's loan brokerage VetFinance Group (also called VFG Practice Solutions) is unclear. The company's website is down, but a veterinarian who has been working with Paterson on a loan deal — and who requested anonymity because negotiations are ongoing — told the VIN News Service that he hears from Paterson regularly.
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