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Carrollton, TX – Southwest Credit Systems, L.P. a national provider of accounts receivable solutions, is proud to announce the addition of Sharell Weeams and Kathleen Eads to their management team.
Sharell Weeams, Director of Marketing and Client Management, will manage all marketing initiatives and maintain high-level client relationships. She has 13 years of experience, which includes six years in the collections industry and four years of agency and corporate marketing experience. Sharell holds a Master of Business Administration in Marketing Management from the University of Dallas and a Bachelor of Business Administration in Marketing from the University of North Texas.
Kathleen Eads, Manager of Client Services, will be responsible for overseeing the day-to-day management of the client services team and ensuring the highest level of service is provided to our clients at all times. She has more than 20 years of experience in the credit and collections industry working in several capacities, including 10 years of sales and marketing to top firms within the industry. Kathleen holds a Bachelors of Business Administration from the University of North Texas.
Founded in 1974, Southwest Credit Systems L.P. is a national provider of accounts receivable management services to small and large companies in the Communications, Education, Utility, Government, and Financial Services industries. Southwest Credit services consumer and commercial accounts along various stages of the credit and collection process.
Southwest Credit has a Better Business Bureau rating of A+. For more information contact 1.800.637.7439 or visit their website at www.sw-credit.com.
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One of the owners of a payday loan and collection operation agreed to settle Federal Trade Commission charges for his role in a scheme that used illegal collection practices.
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Buyers are out in force, scouring the ARM industry looking for collection platforms and add-ons. If you are like most debt collection agency owners, you probably field multiple calls a week or receive “We Have a Buyer” letters from private equity firms, investors, M&A advisors (folks like me), business brokers, other collection agencies and India-based call centers or BPO companies. I would be surprised if you didn’t!
I would love to say that all agency owners will call me or our firm before responding to an inquiry but, believe it or not, that doesn’t always happen!
Here are a few tips before spending too much time with an unsolicited buyer prospect:
- Utilize Google – This sounds obvious but spend 5-10 minutes and type in the buyer or the principal’s name into Google and see what comes up. You may be surprised what you learn. An agency owner called me last week after receiving an offer from a buyer and then did an Internet search at my suggestion and found out that the buyer had substantial FDCPA and State AG actions against him and also determined that one of the principals had gone bankrupt. If the owner had done this search before engaging in discussions, he could have saved himself a lot of time and energy.
- Understand Financial Capability – Find out up front if the buyer has the financial resources to complete a transaction. Determine whether they will need to raise capital or have the cash on hand to complete a deal with you. It is okay to ask for a statement of net worth or a commitment letter from the buyer’s bank or capital provider during your discussions. We sometimes hear horror stories where a seller will go down the path with a buyer only to find out later on that they can’t fund the deal. This is a nightmare that can be avoided very early in the sale process by asking the right questions up front.
- Valuation Approach – Confirm the buyer’s approach to value as early as possible. A buyer will typically value your business on a multiple of adjusted EBITDA (earnings before interest, taxes, depreciation and amortization normalized for any excess or one-time add-backs) if you are a “going concern.” However, if you know that you are looking for a buyer that will go “beyond the numbers” to calculate enterprise value, no need to waste much time talking if you know they will come up short at the end of the day.
- What are the Buyer’s Intentions? – Try to figure out what the buyer wants to do with your collection agency before getting too far in your discussions. Do they want to use your agency as a platform investment or will you be add-on to another agency? Do they want to move business near-shore/off-shore? What will happen with management and staff? If they are going to consolidate the business, change the name, or down-size staff make that determination early in your discussions so you know what you are walking into.
Be selective with who you give your time and confidential information to and, I cannot emphasize enough, do your own due diligence upfront. I assure you that the buyer will shake you from your ankles upside down before funding and closing a transaction. You have the right to do the same.
Have you ever found out something about a buyer and had to stop discussions and kill a deal? How do you qualify a buyer prospect? I look forward to your comments. Feel free to call/email me.
Michael D. Lamm advises owners on their growth and exit strategies for Kaulkin Ginsberg’s Strategic Advisory team. Michael can be reached directly at 240-499-3808 or by email. You can also read his blogs, follow him on Twitter, or network with Michael from his social media page on insideARM.com.
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A credit repair operation agreed to stop making false claims and stop charging upfront fees under a settlement with the Federal Trade Commission.
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Bradley Rice, president of collection agency Central Credit Control, is the winner of insideARM.com’s “What Summer Looks Like to Me” photo contest. Rice’s photo was neck-and-neck with B. Majewski’s entry for most of the voting, but he pulled away at the very end to capture 27.4% of the vote, with second place getting 21.1%.
Voting was very spread out among the entrants, and with nearly 400 votes in the contest, every one counted. Thanks to all who voted!
Rice has worked in the debt collection industry for 17 years. His firm, Central Credit Control, has been in business since 1987 and is a third party contingency agency that concentrates on recovery work in Canada. Rice is also currently serving as President of the Ontario Society of Collection Agencies.
As for the winning shot, Rice said the picture was taken after a hot day on the soccer field. He was snapping pictures of his older son practicing, when his younger son picked up the hose and decided to have some fun.
Vengeance is a dish best served wet, as we all know.
Thanks to his boys, Rice will receive a $50 gift card to Amazon.com and the permanent adoration of the entire ARM industry. Congratulations, Bradley!
View Rice’s photo and all of the finalists
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After a brutal 21-hour legislative session ending in the early morning hours of June 25, Senate Banking Committee Chairman Chris Dodd thought regulatory reform was finally finished.
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Brown & Joseph and long term partner Management Services & Associates (MSA) announce a new program, the SBMA (Southern Building Materials Association) Cash Advantage Program. The SBMA Cash Advantage Program is a new program to help members address working capital and liquidity needs.
Under this program, Brown & Joseph and MSA will utilize its broad and deep building material industry and financial experience to assist members in pursuing a variety of working capital and liquidity solutions.
Understanding the challenges faced by companies in the building supply industry when it comes to financing operations and growth, George MacConnell and Robert Turner founded MSA. Bob and George may be familiar to many of our members based on their long-term involvement with the building materials industry. Each of them spent more than 20 years in Georgia-Pacific’s building materials distribution business. George ran the business for many years, and Bob served in a variety of senior finance and operating capacities. MSA was formed 10 years ago and has worked with many types of building materials companies across the U.S.
“Companies need working capital to survive, in any economy. Brown & Joseph and MSA work together to assist companies with getting cash flow and reducing DSO,” says Chris Cappuccilli of Brown & Joseph, LTD. “We are here to help. That is what we do.”
Brown & Joseph, LTD is a full service accounts receivable firm. For more information on Brown & Joseph’s service offerings, visit us on the web at www.brownandjoseph.com. If you would like additional information or have questions regarding this press release, please contact Allison Sima at 888-829-9997 ext. 209 or e-mail asima@brownandjoseph.com. For more information on MSA, please contact Bob Turner at 770-490-9092 or email bobturner@msallcsite.com.
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AUSTIN, Texas – Texas Attorney General Greg Abbott today charged Coppell-based American Home Mortgage Servicing Inc. (AHMS) with using illegal debt collection tactics and improperly misleading struggling homeowners.
According to state investigators, AHMS collections agents used aggressive and unlawful tactics to collect payments from Texas homeowners who had difficulty meeting their payment obligations. The defendant also failed to credit homeowners who properly submitted their payments on time.
In other cases, AHMS agents falsely claimed that homeowners did not make payments so the agents could justify profitable late fees or escrow accounts. The defendant also failed to properly credit homeowners after AHMS agents withdrew funds from the homeowners’ checking accounts. Because of the defendant’s unlawful conduct, homeowners defaulted on their loans, leading to foreclosure proceedings.
Additionally, the defendant claimed to have a “Home Retention Team” to assist distressed homeowners. Many customers found that AHMS could not qualify homeowners and that they were of no help to halt the foreclosure process. Some homeowners who actually obtained loan modifications found that their monthly payments increased rather than decreased, which worsened their problem with foreclosure.
Today’s enforcement action charges AHMS with multiple violations of the Texas Debt Collection Act and the Texas Deceptive Trade Practices Act (DTPA). The State is also seeking civil penalties of up to $20,000 per violation of the DTPA.
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Five of the largest credit card issuers in the country reported lower charge-off and delinquency rates in July just as a separate report verified industry-wide improvement.
Bank of America, Capital One, Citigroup, Discover, and JP Morgan Chase all said that charge-offs and delinquencies fell in their credit card units in July. Citi recorded the largest drop, noting that charge-offs in July accounted for an annualized 9.1 percent of accounts compared to 11.5 percent in June.
Delinquencies also fell in July, according to monthly regulatory filings for major issuers’ master card trusts. Most card issuers and banks have been showing a positive trend for delinquencies over the past few months. All five major credit card issuers reported delinquency rates below six percent in July:
The filings came a week before a Moody’s report showing industry-wide performance improvement.
In Moody’s monthly Credit Card Indices Report, the ratings agency noted that the average delinquency rate for all card issuers fell to 4.93 percent in July, the first time in nearly two years the rate has been below five percent. Likewise, the average charge-off rate fell below 10 percent, to 9.3 percent, for the first time in 14 months.
Moody’s said that it believes credit card losses have peaked and performance will improve from here. But the industry is coming off a lofty peak.
The Federal Reserve reported last week that the average annualized charge-off rate for credit cards hit a record in the second quarter (ended June 30, 2010) (“Credit Card Charge-Off Rates Hit Record High in Q2,” Aug. 24).
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American Home Mortgage Servicing Inc. faces charges of using unlawful and aggressive collection tactics and improperly misleading homeowners.
