A couple of months ago there was a rather “interesting” factoring case doing the rounds being a restart of a printing company that had gone bust defrauding Lloyds TSB in the process with loads of fresh air invoicing and as one would expect it was declined by all of the established factoring companies.
Much to my surprise I heard that this challenge had been taken up three weeks ago by one of the new kids on the block with a funding limit of £250,000
I have since heard that the factoring company are not happy with this partnership and are trying to unload it already giving the reason that they can’t offer more than £250,000 and the company really needs more than that.
The printing company obviously think that the more brokers they put it to increases the likelihood of finding a mug factor to take them on as there are currently at least two of the highest profile factoring brokers touting this around using the line that “this is a good little deal”
Neither broker is incompetent so they must be aware that all is not well with this particular deal and are hoping that the factoring companies that they are asking to look at this are too dumb to notice but that probably won’t be the case and the brokers will end up with their reputations tarnished whilst the new kids on the block will be keeping their fingers tightly crossed that they aren’t going to go the way of their predecessors already
I spoke to an administrator re the new kids on the block (partnership finance/ Challenge) who informed me they are having troubles again. Recently another client who went into administration (solugistics ltd) is a fraud which unless their was machinery involved they would have been 100k plus out of pocket and would have gone under for the second time in 12 months. Not what you want to hear from a factor hence why its important to go with one who is abfa registered. I believe it was their only ID client and no audits were carried out, so I think they have internal problems and themselves to blame. I feel sorry for any clients who are with them as they could be finding a new home soon.