Cashera and Funders App Sue the Shabsels Brothers Over $6.4M Funded on Bankruptcy's Eve
According to the suit, as reported by Law360, Cashera and Funders App, an MCA underwriting and syndication platform, provided funding in April and May of this year, ostensibly for the benefit of Island Lake Camp in Pennsylvania, with the brothers guaranteeing the obligations and scores of their camp and real estate entities listed as additional guarantors. The funders allege the brothers were insolvent when they took the money and never intended to repay it.
Their sharpest fact: two days after the May financing closed, SIMAD's general counsel signed a retainer agreement with bankruptcy counsel.
In the funders' telling, that timing makes it impossible to believe the brothers didn't know the filings were coming. The camps, both brothers, SIMAD, and the real estate entity DAMIS all filed Chapter 11 on June 4, roughly a month later.
Suing inside the individual bankruptcy cases, rather than simply filing a claim and waiting, is a familiar playbook when fraud is alleged. In general terms, debts obtained by fraud can be excepted from an individual debtor's discharge, meaning a creditor who proves deception may be able to chase the debt even after the bankruptcy wraps. That is typically the point of bringing this kind of action against the individuals rather than just the operating companies. Whether these funders get there is for the court to decide.
Where MCA money sits in the waterfall
Here is the sobering part, and it applies well beyond this case. Most of the camps have found buyers, and DAMIS is selling a portfolio of more than 40 malls, warehouses, water parks, and other properties. That sounds like a lot of proceeds. But sale proceeds in Chapter 11 flow through a strict priority order, and unsecured claims drink last.
As a general matter, not legal advice: mortgage holders and other secured lenders with liens on the camps and real estate get paid first from their collateral. Then come the administrative costs of the cases themselves, including the professionals running these estates, which in a 30-plus-entity portfolio sale will not be small. Then priority claims like certain taxes. Only after all of that do general unsecured creditors split whatever remains, pro rata. Personal guarantees, absent a perfected lien with seniority, generally land in that unsecured pool. So, in all likelihood, do these MCA claims, which is why the fraud theory matters so much: a nondischargeability win against the individuals could keep the debt alive beyond the cases, while a plain unsecured claim rides the waterfall down.
And the pool is getting crowded. The Justice Department intervened this week in a False Claims Act suit seeking treble damages over more than $13 million in PPP loans the camps allegedly obtained above the corporate group cap, litigation the government has said proceeds despite the bankruptcies. Every dollar of that claim, if proven, competes with every other unsecured creditor, including the funders.
Timing follows the same logic. Distributions to unsecured creditors generally wait for sales to close, secured and administrative claims to be resolved, and a plan to be confirmed. In a case with this many entities and this much litigation, that is a horizon measured in many months at minimum, and recoveries at that tier are never guaranteed.
The lesson for the funding desk isn't new, but this case states it plainly: a guarantee is only as good as the guarantor's balance sheet on the day you fund, and by the time the retainer letter gets signed, the waterfall is already forming.
Sources: Law360 (Hilary Russ, Aug. 26, 2026) for the litigation details; bankruptcy case numbers 3:26-bk-16439, 3:26-bk-16529, 3:26-bk-16530 (D.N.J.).
