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- Fraud Corner - "A Case of Mistaken Identity"
- Latest News in the Factoring Industry
- IT Corner - Video Revolution - Business in Motion
- CarrierGuard - Around the Clock Insurance and
Authority Monitoring for the Trucking Industry
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A wholesale grocery distributor was working with a Factor that was funding receivables and had also granted a line of credit on inventory. The distributor sent and invoiced a good sized order to its largest customer. After a few days, the customer called and stated that 70% of the shipment was an "over ship." The distributor agreed with the customer and indicated that, in order to save freight, the distributor would arrange for its supplier to pick up the excess goods from the customer, as the distributor's supplier was located in the same town as the customer.
A few days after the pick up was made, the supplier shipped to the distributor an amount of goods equal to the amount that it had picked up. There was no charge on this shipment to the distributor. So this should have squared everything away and everyone was happy, assuming there were reserves to cover the diluted invoice. Right? WRONG!!! At the time of the return to the distributor, a field auditor and a member of the Factor's staff happened to be on site conducting a field exam. The nature of this return piqued the auditor's curiosity.
The auditor checked the cartons as they were being placed on the shelf, paying special attention to the expiration dates. They all seemed reasonable. But when a sample carton was opened, he found that the inventory, which consisted of time-sensitive goods, had expiration dates 1-2 years prior. Further investigation revealed that 50% of the inventory contained items of which the expiration date had already passed.
The books reflected that the supplier in question was owed seriously delinquent payables. Needless to say, it was determined that the distributor and his supplier were in collusion.
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Desperate to keep its principal supplier, the distributor had found a way to "repay" the supplier, but still keep cash flowing from the Factor.
When the Factor's officer called back to the office, he heard from his staff that cash collections were way down, returns and dilution way up, but the verification department had not processed a lot of adverse pre-funding verifications. As most of the good inventory was being exchanged for old inventory, the distributor had started to ship the bad inventory (in good cartons) to its customers, borrowing on the invoices. Bottom line: the inventory was bad and the A/R was bad.
Most Factors focus their efforts looking into the relationship with the client and its customers, many times overlooking the importance of the Accounts Payable side. If the bills aren't being paid, sooner or later the Factor's pocket is going to get picked. Make sure you are constantly receiving enough information to spot the warning signs, and then send out an auditor to see what the real story is…
Credit Support International, the umbrella organization of FactorHelp, has a Collateral Auditing Division with over 20 years of experience in professional collateral auditing and pre-funding exams.
For any questions, please email Jon Eckhouse at jon@creditsupport.com or call (972) 231-6572.
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GMAC Commercial Finance (GMAC CF) is proud to announce the promotion of Frank Torchen and Shawn Lipman to new roles within the company's Commercial Services Division. Both are headquartered in GMAC CF's Los Angeles office. Mr.Torchen has been named executive vice president/western regional manager effective Oct. 31. He brings 25 years of expertise to his new position, including previous supervisory experience with GE Capital, Heller Financial, US Bank Business Credit and Finova Capital Corp. In his new role, Torchen reports directly to John Waxlax, president, CSD North America.Shawn Lipman has been named senior vice president/western regional portfolio manager effective Nov. 1. Mr. Lipman joined GMAC CF in 2002 as vice president. Prior to joining the company, he held senior underwriting and credit analyst positions with Comerica Bank, Finova Capital Corp. and Libra Mezzanine Partners. In his new role, Mr. Lipman reports directly to Frank Torchen.
Sterling National Bank, the principal banking subsidiary of financial holding company Sterling Bancorp announced the appointment of Greg Keramis to senior vice president and credit manager of Sterling Factors Corporation, a wholly-owned subsidiary of Sterling National Bank. In this position, Mr. Keramis will be responsible for overseeing customer credit exposure and managing the credit department. He will report to John LaLota, executive vice president of Sterling Factors and Sterling Capital Funding. "With extensive experience in both lending and credit management, Greg is a great addition to the Sterling team," said Mr. LaLota. "His first-hand knowledge of the factoring business coupled with over 35 years in financial services will help drive the growth of our company and play a significant role in delivering our diverse range of specialized products.
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In addition, he will be instrumental in providing superior customer service that is tailored to meet the individual needs of each of our clients."
LSQ Funding Group, L.C. is pleased to announce the appointment of Jennifer Rabinowitz to vice president, business development officer in the New York office at 1120 Avenue of the Americas, Suite 4168, New York, NY 10036; Tel: 800-413-0959. Robert McCarthy was appointed to vice president, business development officer in the San Carlos, CA office at 751 Laurel Street, Suite 620, San Carlos, CA 94070; Tel: 800-394-9134.
Bibby Financial Services announced the appointment of Rosalynn Gelfo as chief executive officer to further strengthen its management team in the California marketplace as it enters its third year of operation in the area. Ms. Gelfo has been in business banking for over 25 years and her extensive experience in the industry will ensure that businesses on the West Coast will have access to the very best in receivables funding. Bibby Financial Services has, in recent years, embarked on a challenging growth strategy driven by a unique business model of autonomous companies. It has a strong commitment to grow its business to become the number one independent receivables funder in the U.S. as it is in the United Kingdom.
Factorhelp offers a complete suite of Investment Banking Services for companies in the Factoring Industry. Call, email, or visit our website today for all of you M&A and/or portfolio brokerage needs!
Thomas G. Siska, Managing Director (847) 498-9136 or tsiska@factorhelp.com
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Buy Credit Reports through FactorHelp.com cheaper than you can buy direct! Experian & Equifax - Consumer & Business Credit Reports
The world is in motion - play, skip, fast-forward and rewind. In the 21st century nothing antiquates a business faster than its conspicuous absence of motion - so speaks the digital democracy. The modern business can no longer afford to simply be defined by the printed page. With the revolution of the Internet, new technologies and alternative streams of media, the world is now one of moving images, music and intelligent messaging. A stylish visual resource can function independently, or in conjunction with existing or new companion print and Internet campaigns to give your advertising a robust, multi-dimensional impact.
Beyond Photography - From cell phones to DVDs, motion pictures to music videos, the accelerated merging of previously divergent media formats is creating fantastic and heretofore unrealized cross-marketing opportunities, blurring the lines of obsolete marketing models and devaluing the power and longevity of the stand-alone media campaigns.
Studio design services can dramatically improve presentations, films, corporate or industrial videos, DVDs, or any other visual format. From the subtle to the lavish, you can affordably enhance your work through a broad suite of software titles ranging from 2D/3D modeling & animation, special effects, living schematics to dazzling transition effects and much more. Don't tell customers the power of your company - show them!
Big Effects on Affordable Budgets - Dazzling visual effects were once only for the well-funded Hollywood producers with rooms full of expensive hardware. Now through software, such as Adobe After Effects, Alias Maya and NewTek LightWave, and hardware innovation, state-of-the-art video production services are now available to companies and groups of all sizes.
A quality video production conveys your message and generates buzz. Incorporating animation, modeling, photographic manipulation and a big pinch of fairy dust, the most mundane video can be transformed into the colorful and the captivating, effectively dazzling you or your clients. Only the imagination can limit the possibilities for creative visual arts services.
DVD - Video Medium of Choice - With a single DVD, your company can make its first impression with power and precision.
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Virtually any size company can affordably and expertly communicate any or all aspects of their business to anyone in the world: corporate video, commercials, presentations, PDFs, files, software demos, databases. Interestingly, the DVD is rapidly becoming the new press kit. With a cost-effective DVD case, a company can supply a bundle of information. The DVD itself can hold 4.7Gb of any kind of data. In addition to this, the case jacket gives your company the front and back covers to hit the highlights of your firm. On the inside cover, a 2-sided 4.75" x 7" insert can go into specifics. This need not be a single insert, but can also be a miniaturized bi-fold or tri-fold brochure.
In short, for far less than one might suspect, your company can have data-rich package on par with Hollywood movie DVDs you buy at Blockbuster. Given such a package would have diverse elements to it, find a company that can handle all aspects of such a DVD kit to ensure a continuity among the design. Nothing looks more unprofessional than a bunch of literature that in no way resembles each other.
Internet - The New Visual Stage - Recent advances in browser and plug-in technology have helped to create mass adoption of new client-side video streaming technology, such as Flash 8. The new version's improved codec, which is its particular video compression format, makes it a significant threat to Microsoft's Windows Media technology, RealNetworks' Real format and Apple Computer's QuickTime format. Flash video is also "player less", which means video clips play embedded in the webpage.
The ability to integrate and implant video into websites is going to have dramatic effects on the appearance of the internet. When this is combined with the increasing speeds and availability of broadband, the result is almost a new version of television - enter the world of interactive internet TV!
David Jetre is Creative Director of Design & Technology Consulting Services.
DTCS offers a complete suite of creative, marketing and technical services including video production, print design, advertising, internet marketing and consulting.
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CarrierGuard is a Web-Based Compliance Monitoring System which tracks the changes to your registered carrier's Insurance, Authority & Safety Ratings 3 times per week and notifies up to 5 people at your company of any changes via email or fax. This is done automatically so you will never again have to worry about where your carriers stand, whether they are borrowers or debtors.
Because we capture all of the 400,000+ DOT data on our system, CarrierGuard also provides information that you simply can't get anywhere else. This is what we call our Fraud Protection Feature. As you validate carriers initially, by using our system instead of going to the DOT's website, you can not only see the current status, but by using our Fraud Protection Feature, you can also see:
• If there are any similarly named carriers in the system. One of the fraud tricks is to have two companies with almost exactly the same name and then let one run up debt while the other siphons all the cash.
• If there are any other registered carriers at the same address. Again, if you've had trouble with a carrier, it's a safe bet that the people behind it will give you trouble again, but use a different name. You'll know upfront if there are multiple entities.
• If there are any other registered carriers at the same phone number. Sometimes the new or different name will use a PO Box, but the phone number will stay the same.
• If your carrier has multiple DOT #s, meaning that loads you think were hauled directly by your carrier, could have been hauled under broker authority instead. Brokered loads have a different legal status that direct hauls.
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You can use this feature on any carrier, whether they are a presently monitored carrier or not, and you can do so as many times as you want. So if you begin sniffing out a problem, you can have one additional tool to turn to!
CarrierGuard also can be used as a Marketing Tool, with our Company Locator feature. Again, because we get the entire database sent to our system, you can find all carriers registered with the DOT in any geographic location you choose at the click of a button. You can also search for Pending Authority in any particular state. So you can see who is entering the Transportation business.
Finally, for those companies that are interested in the Safety Ratings of their carriers, CarrierGuard also tracks and monitors those changes as well.
CarrierGuard is a yearly subscription based service, and the service costs as little as $2,000 per year for those firms monitoring fewer than 250 carriers. For those firms monitoring thousands of carriers, the cost is just a little over $1 per carrier per year. AND by signing up NOW, you can try the service for one month, and if it doesn't meet with your expectations, cancel it and only pay for the one month.
You can go directly to CarrierGuard.com to sign up or email jon@creditsupport.com to schedule a time to do a 10-15 minute demo. The system is very easy to use & we can show you how it works- live.
CarrierGuard provides the most protection available to those firms with exposure in the Transportation Industry! Period.
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