ATLANTIC CITY, N.J. (AP) — A loan program that was supposed to lend as much as $40 million to struggling homeowners and businesses in cash-strapped Atlantic City has given out nothing and instead led to a federal lawsuit.
Atlantic City is suing to get back $3 million it gave to the company that has failed to run the Community Loan Program. The program was launched in 2013 by Lorenzo Langford, who was mayor at the time.
The Associated Press found that the company is partially owned by relatives of a former aide to Langford. ZeMurray Street Capital used most of the money to buy a Tennessee firm that has since had management of its government-backed loans taken away by the Small Business Administration.
The lawyer for the company and W. Wesley Drummon denies the city’s claims. He says city lawyers had reviewed the loan program.