Northeast Ohio Neighborhood Health Services (NEON), a federally qualified nonprofit health clinic, has been serving patients on Cleveland’s East Side for nearly 60 years. The health center operates six clinics and a mobile health unit, providing reduced-cost care to patients regardless of insurance status.

Foreclosure Battle

In February, New Jersey-based lender All Pro Capital asked a U.S. District Court judge for permission to foreclose on NEON’s properties to recoup the millions of dollars the health center owes. NEON has accused All Pro of “fraudulently” transferring about $4.2 million out of a shared bank account, claiming the lender broke their contract and shouldn’t be able to take its properties.

The health center’s finances took a dive after a 2021 fire destroyed its most “profitable” site, the Hough Health Center. NEON also experienced a cyberattack that restricted its ability to provide services and collect payments. The health center negotiated an $11 million loan with All Pro Capital to stay afloat but claims the terms were not favorable and the lender charged extensive fees and increased interest rates over time.

NEON argues that All Pro unfairly took money that other debtors could have received, calling it a “fraudulent and preferential transfer.” The lender’s lawyer did not provide a statement but said they would respond in court. The judge must now decide whether to grant All Pro Capital the ability to foreclose on NEON or seek more facts in the case.

Original reporting: Signal Cleveland — read the source article.