Beleaguered Community Resource Collaborative faces new $190K lawsuit from ESL

Justin Murphy, Rochester Democrat and Chronicle
Updated ·2 min read

The much-troubled Community Resource Collaborative got more bad news Tuesday in the form of a lawsuit from its bank, ESL Federal Credit Union, alleging about $190,000 of defaulted loans.

CRC is at the center of multiple investigations related to its role as fiscal agent for a $7.1 million federal grant awarded to a confederation of local social justice organizations and businesses, the Neighborhood Collaborative Project. CRC failed to pass the grant funding along as required, with several hundred thousand dollars now unaccounted for.

Interviews with stakeholders and a review of financial documents show frantic money-shifting over the last six months as CRC and its founder, Tina Paradiso, tried to keep up to date on its bills. The ESL lawsuit provides another window into that ultimately unsuccessful scramble.

On Feb. 12, the outside of 100 University Avenue is seen. It's the office location for CRC, Community Resource Collaborative.
On Feb. 12, the outside of 100 University Avenue is seen. It's the office location for CRC, Community Resource Collaborative.

According to the lawsuit, filed Tuesday in state Supreme Court, CRC had five loans, accounts and lines of credit with ESL, all opened between January and August 2023 and totaling about $190,000.

  • A $125,000 line of credit opened in August 2023 and immediately borrowed in full.

  • A $32,000 loan made in April 2023 with commercial printing equipment as collateral (In addition to her role with CRC, Paradiso owns a printing company called Imprintable Solutions).

  • A $29,000 negative balance in a business checking account opened in January 2023.

  • A credit card and checking overdraft account, each with a balance of about $5,000.

After CRC's troubles became public in February, ESL called the loans due, but CRC has not paid the money back. Its operations are frozen during its own internal audit.

"I'm mystified as to why ESL would sue a corporation that everyone knows is upside down six figures and has absolutely no assets," said Paradiso's attorney, Steve Feder.

ESL spokesman Rich Pulvino said the lawsuit is "consistent with actions we would take for business customers who are in default on their loans with us."

The attorney conducting CRC's internal investigation, Langston McFadden, did not respond to a request for comment.

ESL's lawsuit seeks not only the $190,000 but also interest and attorney's fees. The $125,000 loan, for example, has been accruing interest at 9.5% since August.

ESL's philanthropic wing, the ESL Charitable Foundation, gave a $49,100 grant to CRC in 2022 for "BIPOC leader coaching and organizational capacity building," according to a tax filing. BIPOC stands for Black and indigenous people of color.

CRC also faces lawsuits from two downstate lenders for loans made in December and January. Employees of CRC and Imprintable Solutions said both entities were unable to pay bills by late last year, making it likely that other lawsuits from dissatisfied creditors could be coming.

Learn More: Community Resource Collaborative financial crisis takes toll, impact grows

This article originally appeared on Rochester Democrat and Chronicle: Community Resource Collaborative faces new $190K lawsuit from ESL