[Funder Mark]

I was just speaking with a guy who opened a settlement company last year, he said he is doing very well, growing quickly. He also said he flipped several large ISO shops in NY from selling cash advances to chasing merchants for settlements. The MCA industry has to wake up, and change how it works, so the industry doesn't find itself spending more time lobbying in Washington instead of closing merchants.

[Collection Specialist]

Disgusting. Every funder needs to stop filing UCC's

Beyond suing these companies that's the only solution. If that were to take place, their leads would dry up very quickly.

[WestCoastFunding]

Disgusting. Every funder needs to stop filing UCC's

Beyond suing these companies that's the only solution. If that were to take place, their leads would dry up very quickly.

These guys market directly to ISO and brokers. I'm constantly getting spammed from these guys. I can see brokers selling these programs while pitching advances. "Take this 5th position because I'll get them 'restructured' through one of my shady settlement companies."

The best way to combat this is for funders to refuse settling with these guys.

[Michael I]

Disgusting. Every funder needs to stop filing UCC's

Beyond suing these companies that's the only solution. If that were to take place, their leads would dry up very quickly.

it is something that i will love an a funder to comment on .Why do it and make your merchant get a 100000 phone calls to stack . can you not file it quickly the second a missed payment happens

[abfunders]

The best way to combat this is for funders to refuse settling with these guys.

It's pretty hard.
They first move all of the funds of the normal business bank account into a 2nd account so that all the ACH draws will bounce. Then they send a bunch of lawyers letters at them telling them that they need a restructure do to the fact that it's not a loan and it is an advance, and the advance is based on purchase of future receivables; since there are fewer receivables, therefore there is less money to give, so change the ACH amount, please.

It happens to be that the funders will blacklist anyone with a restructured program or altered ACH draw. Once they're out, they're really out.

I don't know how a funder could "refuse" to settle. Credit card splits is the answer to some of this (that is, after all, the "original" MCA way), but it's more work for the average advance company to do and they can't do companies that don't accept credit card, and they can't get as high of a daily draw....

So they'd rather focus all their energies on ACH and hope that these clients don't default, or not work with them to reduce their payments.... or let the merchant call in the "clean up crew."

[Collection Specialist]

These guys market directly to ISO and brokers. I'm constantly getting spammed from these guys. I can see brokers selling these programs while pitching advances. "Take this 5th position because I'll get them 'restructured' through one of my shady settlement companies."

The best way to combat this is for funders to refuse settling with these guys.

Then there is a simple solution. Have any direct funder put a clause in any ISO agreement specifically barring them from referring merchants and ensure the clause has a litany of damages that can and will be awarded should it be determined that they do. Hell, have them sign a COJ to that effect even. It may not stop all of them but it would give some a little pause before they do. This would also be a good argument for licensing because were a license required, it is likely the degenerates who sell everyone out could not obtain one. I for one don't agree with the concept of regulation but this would certainly be an upside.

[WestCoastFunding]

I don't know how a funder could "refuse" to settle.

By saying no, and filing on the merchant. Make their lives hell.

[WestCoastFunding]

The real way to end the stacking mess is to do two things:

1) funders need to actively promote and use the reconciliation clause each month or even each week. Merchants stack because they are choking, so the best way to help in that situation is reduce their payments. Adjust on a regular basis. Not only does it help with the merchant's cash-flow issues, it also scares off stackers because they see these adjustments as "reduced payments".

2) Stop with the insane renewal practice of, as some merchants call it "interest on interest". It can be cheaper to stack and they often net more money.

[Chambo]

The real way to end the stacking mess is to do two things:

1) funders need to actively promote and use the reconciliation clause each month or even each week. Merchants stack because they are choking, so the best way to help in that situation is reduce their payments. Adjust on a regular basis. Not only does it help with the merchant's cash-flow issues, it also scares off stackers because they see these adjustments as "reduced payments".

2) Stop with the insane renewal practice of, as some merchants call it "interest on interest". It can be cheaper to stack and they often net more money.

Don't forget the merchant who QUALIFY for $10,000, but WANT & DEMAND $25,000. They take the first deal for $10K, then stack 2 more times to get the $25K they originally wanted. Usually when this happen, they are banking on things falling together that rarely do within the time frame to pay everything off, so now they find themselves choking and resort to even more stacks to stay afloat.

Until reps learn this industry and learn how these deals work, and what it takes to get approved for X as opposed to Y, they will keep telling the merchant anything they want to hear and keep ramming more and more deals down their throat.