The FTC shut down Seek Capital for scamming small businesses out of $37M. Here’s how they did it, what “credit card stacking” really means, and how to avoid getting played.
I’ve been in business lending for years. Long enough to know the difference between an actual financing solution and a sleazy hustle dressed up in buzzwords. So when I first started hearing about these “startup funding” offers — you know, the ones promising $50K to $150K in 24 hours, no business history required — I was skeptical.
Turns out, I had every reason to be.
What these guys were selling wasn’t magical startup capital. It was something we in the industry have known — and side-eyed — for years:
Credit. Card. Stacking.
What Is Credit Card Stacking?
It’s exactly what it sounds like. A broker or “funding consultant” applies for a bunch of personal credit cards on your behalf, usually without full transparency, and then charges you a massive fee for doing it.
They pitch it as some kind of elite service — “We unlock capital that banks can’t!” — but it’s just credit cards. Stuff you could do yourself (and probably better) if you weren’t being rushed by a fast-talking salesperson.
Enter: Seek Capital and Their $37 Million “Consulting” Gig
- Marketed themselves as small business loan experts
- Secretly applied for personal credit cards using client info
- Charged 10% of the total limit in fees
- Hid penalties and gag clauses in fine print
- Locked clients into contracts with up to $995 early cancellation fees
- Coerced people into writing fake positive reviews — and banned negative ones for 3 years
Total take? Over $37 million. All from small business owners just trying to get started.
Why People Fell For It — And Why It Keeps Happening
Let’s be honest: if you’re a new business owner with no revenue and no clear path to funding, you’re vulnerable. You want to believe someone can help. That’s exactly when the wolves show up — and Seek Capital built a business around that vulnerability.
And here’s the thing: even though what they did was deceptive and unethical, the core product — credit card stacking — still gets used all the time by other brokers. It’s just usually wrapped in nicer language and slightly better design.
That’s why this wasn’t some bizarre outlier. This was just the logical conclusion of an industry that still rewards brokers for closing deals no matter the cost to the client.
Real Talk: Credit Cards Can Be Useful — But Not Like This
Let me be clear: credit cards are not the enemy. In fact, for many startups and small businesses — especially pre-revenue ones — a well-managed business credit card can provide helpful short-term liquidity.
But that only works if:
✅ You apply directly and know what you’re getting
✅ You’re not handing over control to someone with a sales quota
✅ You’re using it for short-term needs like inventory, marketing, or float
✅ You don’t use it to fund long-term assets like equipment or major expansion
✅ You pay it down as fast as possible
Opening a couple cards to manage cash flow for 30-60 days? Fine. Paying $10,000 in fees to a broker who opens five cards in your name and vanishes? Not fine.
How to Protect Yourself From “Startup Funding” Scams
If someone’s promising you fast business capital with no real details, slow down. Ask questions. And don’t believe for one second that a broker has your best interest in mind just because they “don’t charge you upfront” (they’re getting paid on the back end — and you’ll still feel it).
Here’s the playbook for not getting scammed:
- Don’t use a broker for credit cards or basic working capital
- Don’t let anyone apply for credit in your name without full transparency
- Avoid companies that hide fees, reviews, or cancellation terms
- Look for lenders that let you apply direct and tell you the real cost upfront
- Get a second opinion before signing anything — seriously
If you’re not sure where to begin, BrokerFreeCapital is here to help you cut through the noise.
Final Thought: You Deserve Better Than This Garbage
Seek Capital isn’t some freak anomaly. It’s just one of the louder, uglier examples of how shady brokers operate when no one’s watching. But now you are watching. And you don’t have to fall for it.
Don’t pay $10,000 for someone to fill out a credit card application.
Don’t trust “consultants” who rush you into signing.
And for the love of all things good in small business — don’t fund your dreams on lies.
Want the truth about business funding without the commission-driven BS?
Diogenes has a flashlight and a megaphone. Let’s go.
Leave a Reply