Friday, June 4, 2010

Big Sister becomes Big Brother

Bluemoon Investigations evolved when its sister company, a financial institution, dealing exclusively with corporate clients, established an in-house team, to deal specifically with investigating the circumstances of defaulting clients.

Whilst some business had genuine cash-flow problems (we’re talking well before the current economic downturn and recession), others cited this as a reason, with no justifiable reason to do so. Perhaps comfortable in the knowledge that the expensive and protracted legal process of pursuing debtors through the courts, at the very least bought them time, and at best would result in the loan being written off by the creditor. Unfortunately some creditors, especially during the so called Celtic Tiger years, took the view that recovering the debt, was simply not worth the hassle or time, when they could be chasing new business. This approach compounded the problem for other creditors.

Therefore Bluemoons big sister became big brother and began to look into the financial position of not just the debtor in question but also the Directors who had provided personal guarantee’s. Armed with this knowledge the business could then prioritise the debtors it needed to vigorously pursue through legal channels.

There is no doubt that whilst more recently the economic conditions has led to an increase in defaulting debtors, it has also led to an increase in the number of debtors alluding to these circumstances as a convenient way to hold on to their cash. Bluemoon’s investigations led to some startling discoveries. In approximately 90% of cases where Directors metaphorically stuck up the two fingers, it transpired that their lifestyles did not match the poverty stricken tale of woe they pleaded. Quite often Mercedes and Jeeps littered the drives of their mansions and (requisite) holidays homes. It seems whilst these individuals are more than happy to enjoy the benefits of the boom, they now have trouble adjusting their living standards accordingly and expect their creditors to carry the can for their excesses.

Fortunately the Commercial Court is now becoming much less tolerant of this type of behaviour and it cannot be take for granted that assets previously protected such as family homes and pension plans, will continue to be afforded any protection. This is good news for Creditors.

Bluemoon Investigations now offers its services to Corporate clients, the legal profession and the general public, providing a wide range of investigative services. Annie Murphy of Bluemoon Investigations regularly engages in investigation into the backgrounds of debtors on behalf of Bluemoon’s clients. Annies advises that these “pre-sue status enquiries” are becoming increasingly popular as they provide creditors with invaluable information for a relatively modest cost. “Once the Creditor has been furnished with the facts they can make an informed decision on the action required”. Annie also welcomes the new hardline approach adopted by the courts “Creditors can be confident that when judgement is issued against the debtor and they know assets exist from which they can be repaid, the court will take these assets, if the debtor does not comply”. This sends a much needed clear message to debtors, which is long overdue”

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