If a French client owes you money, you can apply a certain amount of pressure to encourage payment, and many clients will pay up eventually. But in some cases, you’ll need to instruct a lawyer in France to collect the money you’re owed.
Debt collection in France is a slightly different procedure, compared to debt collection in the UK. This blog provides a rough guide to your options and the types of court action you could bring.
French courts will uphold court judgements made in other parts of the EU and, in some cases, outside the EU as well. For the purposes of this article, we are referring only to court action taking place in France against clients who live and work there.
We recently blogged about Crowdmix, the London-based start-up that went into administration. It’s a sad fact that many businesses fail within their first year. This can’t always be prevented: starting a business is tough. But there are certainly things you can do to avoid disaster.
Profit is important to all businesses, but don’t underestimate the importance of cash flow either.
London based start-up Crowdmix Ltd was in the process of developing a social media music platform. But before it could even launch its product fully, it ran out of money despite having previously raised £14 million in funding.
As of Monday 11 July, 2016, it has left its creditors, many of them freelance contractors, tens if not hundreds of thousands of pounds out of pocket. If you’re owed money by Crowdmix the prognosis for recovery is not good, so let’s look at what happens next.
Four scammers from East Lancashire have been jailed for fraud and money laundering offences after using a string of fake debt collection companies to fraudulently obtain thousands of pounds from SME’s to pay fictitious debts.
Thomas Moffett, Elliot Reed, Nancy Shaw and Gary Oliphant were imprisoned at Preston Crown Court on July the 5th 2016.
The group was part of a total of 18 people sentenced for their role in the scam, for offences including conspiring to commit fraud by false representation and money laundering.
British businesses are facing a unique set of circumstances right now - the global economy is emerging from the deepest recession in living memory, domestic trade is uncertain with the EU Referendum looming, and there are issues of legislation from the National Living Wage to auto-enrolment pensions that are affecting company finances on a national scale too.
With all of this in mind, what are the implications for businesses of all sizes when it comes to getting paid for the work they do?
When Tesco was exposed for its long payment delays, it exposed an ugly trend among large businesses: delay, delay and delay some more, until your supplier is on its knees. And while the supermarket provided an extreme example of this unethical practice, a shockingly large percentage of global businesses see late payment to suppliers as a “fact of life”.
We recently wrote about a large fraud case involving at least six connected companies. Each of these companies used false accounts, identity theft and fake documents to achieve large amounts of credit. When the goods arrived, they immediately vanished, but they were never paid for. The suppliers were left out of pocket, and the fraudsters disappeared with the proceeds.
Clearly, this was a very large and highly organised fraud, and 6 companies known to be involved have been liquidated. This kind of operation is unusual, but increasing in prevalence and we suspect it will only get worse as more criminals start to hear about it.
The Insolvency Service has just completed an investigation into a network of fraudulent companies in the UK. The implications of this investigation should act as a cautionary tale for anyone that offers credit to their customers.
In this case, scammers used fake financial accounts to acquire goods on credit with suppliers, using fake details and false documents to elevate credit limits artificially. As the scam progressed, these companies acquired goods they had no intention of paying for and unwary suppliers continued to offer credit, because all of the companies looked profitable on paper.
The phrase 'no win, no fee' is screamed at you from a hundred adverts a day, usually in relation to personal injury claims, PPI mis-selling and so on, but it is also used in the context of no win, no fee debt collection - meaning you only pay commission to the b2b debt collection company if they are successful in recovering what you are owed.
It's worded all sorts of different ways, so you might also see 'no collection = no commission' on some ads, but it boils down to the same thing - if you don't win back your money from the debtor, then you have nothing to pay.
When you work with a company in the same country, you have a common legal framework that links you and its a relatively simple process to track down errant debtors if payment problems occur. Dealing with clients overseas is more hazardous, and the risks can catch out many small businesses. Here are some practical tips that can prevent significant problems when dealing with overseas clients.