We were approached last week by a company who had only been factoring with Close Invoice Finance for two or three weeks but had already run into serious problems and wanted us to find them an alternative factoring company.
The company that we introduced realising the urgency of the situation did their fact finding visit straight away and discovered that there had been breaches of the factoring agreement but sensing that the underlying business was sound they decided to put the deal forward for approval by the credit commitee which was due to meet on Monday 30th March in order to approve the offer of a facility.
Unfortunately Close couldn’t wait one working day and appointed an Administrator on Friday 27th March. It’s quite a sad state of affairs as we thought that the business was salvageable but no doubt by the time the factoring company has charged a load of extra fees and the Administrator has had his whack there won’t be anything left for anyone.
This isn’t the first story that we’ve heard about the ultra hard line being taken by this particular factoring company since the new MD took over and whereas once upon a time they used to have a fine reputation for service they are no longer on our approved list and haven’t been for some time.
Posted under Close Invoice Finance
This post was written by Ian on March 29, 2009
I have other clients that I can tell you about who have suffered the same fate at the gentle hands of Close. Offers made to pay them off but, no, administrators instead within a day. Then followed, immediately, statutory demands against the guarantors and enormous termination charges and, presumably, enormous administrators fees.
I am hearing more and more horror stories about Close and the hard line that they take on any client that “steps out of line”
There is one shocking story that I read on an internet forum about one of their clients who suffered a bad debt loss and Close fearing that their client might suffer cash flow problems as a result chose to “pull” the facility and issue statutory demands against the guarantors culminating in bankrupcy for one of them as he couldn’t afford to repay the guarantee once all of the additional charges had been added in.
It’s a very sad state of affairs for one of the factoring companies that used to be well respected within the industry
I am one of those clients that have been very badly treated by Close. I would be interested in talking to others that have suffered through their actions.
Our company is currently being crippled by Close. We have composed a letter to send to 10 Downing Street to get this company investigated. Could someone email me contact details of any companies in similar positions in order that we can tackle this together.
EDIT – Sorry, I forgot to add my email address. ts01@hotmail.co.uk
I’m surprised by all these comments. My company factored for many years with Close until we left them because we no longer required their facilities.
I actually found the organisation improved and became more slick when the new MD took over, and throughout our years always received an excellent service from them. I’d recommend them to anyone.
From what I know about the way Close and other invoice discounters operate, it’s usually the businesses that are insolvent and defraud the factoring company that end up in a messy predicament. If those attached to these thread are considering escalation and complaint, they probably need to think carefully before doing so.
As i said, my experience has been all good.
I wasn’t originally going to publish “Chris’s” comment as it didn’t have the ring of truth about it but I decided to do so in the interests of fairness.
I would wonder out loud though why any satisfied client of Close Invoice Finance who allegedly left them because he no longer needed their services would be searching the internet using the term “Close Invoice Finance blog” and I would also point out that “Chris” decided to shroud himself in anonymity by using a throw away Hotmail email address.
I have been contacted by a disgruntled ex client of Close Invoice Finance who is in discussions with other companies in the same position and who has managed to interest his local MP into attending a meeting with as many unhappy Close clients and ex clients as possible with a view to see what action can be taken.
Anyone who feels that they have an interest in this project please contact me and I will happily pass on your contact details if you wish
We are in the process of dealing with an unfair charge from Close and would be interested in further information regarding this meeting.
I would be very interested to learn about other companies that have bad experiences with Close. Please feel free to contact me with your name, company (or former company) and any evidence you have where Close appointed administration. I would especially like to hear from Ian and see if his local MP did have any forthcoming companies.
Hi Tracy please contact me to discuss your case. Tony. ts01@hotmail.co.uk
I have lost everything since doing business with Close. For 8 years they thought my company was the best thing since sliced bread then they made a demand that I simply could not meet within 7 days!! They then sent in the administrators who worked hand in hand with Close and were in no way impartial advisors to Close. I would also like to hear from anyone else who has a similar experience and would advise anyone never to sign personal guarantees.
Has anyone have any knowledge of how many companies have been put into administration by Close?
Close take a strong line with their clients when there’s a hint of insolvency around and they appoint one or two expensive IP’s as administrators to mop up after they’ve levied their vast termination charges. Those IP’s then sell you your business back for far more than its worth simply because they have you by the proverbials. The IP then has his fee.
Get hold of ts01@hotmail.co.uk as Tony is gathering information on this topic and there is a small bunch of victims who are talking to each other, their MP’s and Lord Mandelson’s office.
The answer to your question is “lots”.
Hi All,
Please could you tell me the administrator Close appointed, as this has happened to my families company and the were not interested in trying to save the business but shut the doors ASAP, even though another invoice discounting company was all but in place to take over, close could not wait.
Sorry email is thomasbarr@live.co.uk
Hi Graham please contact me on ts01@hotmail.co.uk. It will be very interesting to talk to you, we can share info. Please leave a contact number. Thanks.
Hi Thomas
The administrators were/are Menzies and the liquidator associated.
Interesting post from Jane Sanders over on the Factoring Solutions blog at http://factoringsolutions.co.uk/blog/?p=94
Ladies and gentlemen. I need to be clear, here. I am not a disinterested party because I act for another client who has been subjected to absolutely disgraceful conduct from a firm known to us all! I run a specialist dispute resolution firm and am currently doing my Bar exams. These guys play hardball. However, this does not mean that they can continue to get away with unconscionable behaviour.
Your contract is key. Have an expert look at what they have done, because if they’ve breached the contract you may well have a remedy.
Also – did you know that have the right to challenge the appointment of an administrator? You can do so within, I believe, 14 days. Given that some of you only need a few more days to secure alternative support, this may well buy you your time.
Additionally, there are loads of resources at your disposal if you know where to look. IPs are regulated, and subject to codes of conduct. You can complain and things can be done if you have evidence that they are in breach of their obligations. In short, you do not have to take any crap.
As I said on the other link: You have rights; use them!
Hi again. Anybody having any problems with SFP (Administrators)?
Jane Sanders good too read your comments,. what body regulates IPS and is there a code or something,my family has been ruined
by Close if we had known about the 14 days it would have saved us. we signed the IPS in 2001 they gave me 5 days too find 160.000
pounds when the ledger was only 80.000 the rest was fees.
again the best advice is not too sign personal guarantees,
May I remind you that this is not a public forum but is supposed to be my personal blog and I would prefer that Gray and Jane Sanders continued their dialogue offsite.
Thanks
I concurr with the sentiment expressed here as a former client of Close. Early in 2009 they simply suspended our account with no notice – we were well within all our account limits and had a good record. It proved impossible to get anyone to deal with us for around 10 days which was a major issue.
My company was forced into liquidation last year as result of non-payment by a client – i ensured Close were fully paid out of the £9k they were out within 20days. Yet again, i am being hit for massive termination fees combined with an unresponse & agressive team.
I was made bakrupt by Close Invoice Finance. One of our customers didn’t pay an invoice they issued proceedings against him but also issued me with a stat demand.
The invoice total was £10K so the adavance was £7K by the time they issued the Stat demand is was £16K. I challenged the SD and lost and they moved for bankruptcy, by now the total outstanding had risen to £25K I offered to pay on a monthly basis £500+, I offered a charge on my house but they would not disclose the last payment, from what I could gather it was accrued interest that was undefined and open ended two solicitors advised me not to sign.
I was made personally bankrupt, the official receiver when they heard the circumstances were unimpressed and were excellent to deal with.
I spoke to the client who hadn’t paid the orginal invoice last week, and although they got a CCJ Close dropped the case and he has heard nothing more since.
I can only assume that there was an insurance policy that could only be claimed on once I was bankrupt. Could anyone confirm this?
I don’t know quite what to say about Close, I would warn any/all of their customers to be very wary of dealing with them, they cannot continue to treat decent companies and people like this without some sort of retaliation.
Has anyone got any ideas, name and shame the people involved????
Having come late to this page I too have been involved in a legal dispute with Close. They closed my business last year despite the fact I had an offer from another factoring company to take over their contract… Since then the process has been a nightmare 12 months with no end in sight, they didn’t follow many of the correct processes when we signed up and the figure that they’ve been claiming started off bearing no relation to the actual funds advanced and has gone up at every point since (despite them making no efforts to collect in the invoices!)
I would be keen to speak to other individuals in the same/similar position…