Cherokee Funding pays for more than just Hostillo's office parties every year. Hostillo also receives nice kickbacks for using Cherokee exclusively, not to mention, all of the golfing trips and office lunches paid by Cherokee throughout the year.
Here is a little secret that I bet most people don't know...... Hostillo's plaintiffs don't even see or sign the contract when they receive money because Mike Hostillo requires all plaintiffs to sign over a power of attorney.
So when you tell Hostillo that you need some advance money until your case settles, his staff signs your contract with Cherokee on your behalf and you never see the contract. Whole thing sounds illegal and "gangster", as you put it, BUT I guess that is why there's a class action lawsuit against Cherokee Funding, Hostillo's Law Office, as well as Mike Hostillo and Reid Zeising individually.