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Business Debt/Collecting $$ owed before a business goes bankrupt
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Question
QUESTION: Hi, I am an independent contractor and I perform long-term projects at financial institutions with a recruiting agent operating as a middle man. For a recent job, I had a contract that stated that the agent would pay my S-Corp once the agent received payment from the financial institution for my services. I have been advised by the financial institution that the agency has been paid; however my S-Corp has not received payment yet. My understanding is that the recruiting agency is doing very poorly and may file for bankruptcy. So basically, the agency used my money on something else. What are my options in trying to get this money owed to me for work that was already completed? Thank you.
ANSWER: Jo,
Since they claim to have paid you, call and ask them for the check number, amount of the check, the date of the check, and what date it was mailed. Follow that up with a letter that is very detailed and send that by USPS Priority Mail with delivery confirmation. In the phone call and letter advise them you did not receive said check and need a replacement sent today. Get that check number and include that information in the letter.
If you do not receive the new check, send them a demand letter IMMEDIATELY and tell them you will take further action. Then file with your local small claims court right away.
Michelle Dunn
---------- FOLLOW-UP ----------
QUESTION: HI Michelle, Thanks for the prompt reply. Unfortunately I must have not been clear in my original question. The agency has NOT claimed to have paid me. My contract with the agent states that the agent will pay me once they receive payment from the 3rd party. I have received confirmation from the 3rd party where I did the work that they (i.e. the 3rd party) had paid the agent for my services. The agent is then SUPPOSED to pay me (minus their cut), but I am still awaiting payment. Does that make more sense?
Send a demand letter that is very detailed and send that by USPS Priority Mail with delivery confirmation. If you do not receive payment by your due date send a letter letting them know you are taking further action. Then file with your local small claims court right away.
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Answers by Expert:
Michelle Dunn
Expertise
As one of the Top 5 Women in Collections, one of the Top 50 Collection Professionals, and winner of the Business Excellence award, I can answer any questions about debt, debt collection, improving business credit, creating a credit policy, enforcing a credit policy and collecting on past due accounts. I can also answer questions in regards to starting a debt collection agency since I have been a bill collector for over 24 years, started and ran my own collection agency for 8 years, and maintain my 12 year old Credit & Collections Association for members of the credit & debt collection industry. I am also the author of the popular and award winning book "Starting a Collection Agency, how to make money collecting money" now on it's 3rd edition. This book has won a the Writers Digest self published award as well as the New York Book Festival Award. I am a repeat contributor to the Wall Street Journal, and have been featured on NPR, CNN, as well as many other national radio and television programs. I have also been featured in national publications such as the Wall Street Journal, Forbes, Smart Money, MSNBC and much more. I have 17 published books to my name and am an accomplished speaker and consultant. I currently write 9 columns for newspapers, magazines and online portals worldwide.
Experience
I have over 24 years experience in debt collection, I started and ran my own collection agency for 8 years and I am the founder & owner of my Credit & Collections Association that I founded in 1998. www.credit-and-collections.com
Organizations
My Credit & Collections Association, I was also a member of the American Collectors Association and Plymouth Chamber of Commerce for 11 years. I am a member of many writing groups as well as my local Women Inspiring Women chapter. I am a member of Know More Media as an expert for their blog on business credit.
Publications
Business NH Magazine, Smart Money Magazine, MSNBC, CNN, Forbes.com, The Wall Street Journal, Home Business Magazine, Entrepreneur Magazine and website, many books, newspapers and television programs as well.
Education/Credentials
I have written 17 books in my collecting money series and one for Entrepreneur Press called the Ultimate Credit and Collections Handbook. My newest book is being published by John Wiley & Sons in May titled, The Guide to Getting Paid, how to weed out bad paying customers, collect on past due balances and avoid bad debt. This book is also being sold to many colleges as a text book.
Awards and Honors
My book Starting a Collection Agency, how to make money collecting money won an award from Writers Digest and the 2007 New York Book Festival in the "How to" category. I have won 2 awards from Dun & Bradstreet and Governor Jean Shaheen. I was nominated as one of the Top 5 Women in Collections twice as well as having been selected as one of Collection Advisor's Top 50 Collection Professionals by my peers.
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