After Employer.com acquired bankrupt accounting startup Bench in a fire-sale late final 12 months, CEO Jesse Tinsley pledged on LinkedIn and elsewhere to honor previous buyer funds.
“We’re honoring all pay as you go Bench companies though we won’t have the income from that immediately ourselves,” Tinsley stated in an interview with founder and investor Julian Weisser.
However some Bench clients say they’re being charged to get books or tax returns they beforehand paid for.
A lawsuit filed on Tuesday by Bench buyer Qorum claims that Bench required it to pay to get its 2023 tax return, regardless of having already paid for the service underneath Bench’s earlier house owners.
“Defendant Jesse Tinsley made negligent misrepresentations when he falsely acknowledged that Employer.com would honor pay as you go Bench companies,” the lawsuit alleges.
One other buyer, who requested anonymity, was shocked to study they wanted to resume their subscription to get accounting books accomplished once they paid for that service two years in the past, in line with correspondence seen by TechCrunch.
Once they questioned this, a Bench consultant instructed them that “Bench 2.0” has no affiliation with prior obligations and that Employer.com couldn’t tackle unpaid work.
Employer.com’s CMO Matt Charney strongly disputes that Bench is charging for beforehand paid work. “We’ve been, and are honoring pre-paid companies for our clients,” he stated.
Charney additionally stated it delivered that tax 2023 return to Qorum with out requiring extra cost. However Qorum’s founder Andrew Pietra instructed TechCrunch he was required to proceed his subscription to get the return within the first place.
Beneath its earlier possession, Bench burned by means of $135 million and struggled to get AI to interchange human bookkeepers. That led to lengthy delays and large piles of books that also wanted to be accomplished, in line with former workers.
A number of Bench clients beforehand instructed TechCrunch that Employer.com had additionally despatched them notices supposed to get them to click on on a consent button that had them foregoing refunds on pay as you go companies.
Many books and returns remained incomplete when Bench abruptly shut down on December 26 final 12 months. Employer.com, a U.S. firm, introduced plans to purchase the Canadian fintech lower than 72 hours later.
Employer.com purchased Bench for $9 million, chapter filings submitted in Canada present.
The fintech’s abrupt collapse was brought on by a scarcity of liquidity after its fundamental creditor, the Nationwide Financial institution of Canada, declined to lend it a further $7.7 million in December 2024. The NBC had already supplied $51 million USD in credit score to the troubled startup, in line with earlier filings.
Paradoxically, it’s the information of Bench’s sudden shutdown that led to its rescue. The corporate had beforehand shopped itself round however did not discover a severe purchaser, the filings observe.
