After Employer.com acquired bankrupt accounting startup Bench in a fire-sale late final yr, CEO Jesse Tinsley pledged on LinkedIn and elsewhere to honor previous buyer funds.
“We’re honoring all pay as you go Bench providers despite the fact that we won’t have the income from that straight ourselves,” Tinsley said 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 beneath Bench’s earlier homeowners.
“Defendant Jesse Tinsley made negligent misrepresentations when he falsely acknowledged that Employer.com would honor pay as you go Bench providers,” 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 accordance 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 providers for our clients,” he stated.
Charney additionally stated it delivered that tax 2023 return to Qorum with out requiring extra fee. 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 through $135 million and struggled to get AI to switch human bookkeepers. That led to lengthy delays and large piles of books that also wanted to be accomplished, in accordance with former staff.
A number of Bench clients previously told 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 providers.
Many books and returns remained incomplete when Bench abruptly shut down on December 26 final yr. Employer.com, a U.S. firm, announced plans to purchase the Canadian fintech lower than 72 hours later.
Employer.com purchased Bench for $9 million, bankruptcy filings submitted in Canada present.
The fintech’s abrupt collapse was attributable to a scarcity of liquidity after its fundamental creditor, the Nationwide Financial institution of Canada, declined to lend it an extra $7.7 million in December 2024. The NBC had already offered $51 million USD in credit score to the troubled startup, according to previous filings.
Sarcastically, 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.