Feds To Liquidate PE Unit For Small Biz Lending Breach

Law360, New York (April 19, 2012, 7:43 PM EDT) -- The U.S. Small Business Administration won court approval Thursday to take control of a subsidiary of private equity firm L Capital Partners LLC that lent out $96 million in federal funds and violated guidelines meant to limit risk.

The SBA was appointed as receiver for L Capital Partners SBIC LP and has authority to liquidate its assets, under a ruling issued by U.S. District Judge Loretta Preska. L Capital SBIC must also pay $6.1 million in principal and accrued interest, according to the order.

The L...
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