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Tackling Non-Payment Issues in Corporate Fraud Cases

In corporate fraud cases, tackling non-payment issues is crucial for recovering company funds and seeking justice. This article explores a Recovery System for Company Funds, Litigation Recommendations, and Rates and Fees to address non-payment challenges effectively.

Key Takeaways

  • Implementing a 3-phase Recovery System can expedite the process of recovering company funds.
  • Consider litigation as a viable option only after thorough investigation of the case and debtor’s assets.
  • Be aware of the upfront legal costs involved in pursuing legal action against non-paying debtors.
  • Understand the collection rates based on the age and amount of claims submitted.
  • Utilize competitive collection rates tailored to the number of claims submitted within the first week.

Recovery System for Company Funds

Phase One

Within the first 24 hours of initiating Phase One, a multi-pronged approach is set in motion to secure company funds. Immediate action is critical, and our team ensures that no time is wasted. The debtor receives the first of four letters, signaling the start of a rigorous collection process.

  • Skip-tracing and investigation commence to uncover the most up-to-date financial and contact information.
  • A dedicated collector engages with the debtor through various communication channels, including phone calls, emails, and text messages.

The goal is to achieve a resolution swiftly. Daily attempts are made to reach the debtor, persisting for 30 to 60 days. Should these efforts not yield results, the case escalates to Phase Two, involving our network of affiliated attorneys. This escalation is a testament to our commitment to proactive recovery steps and thorough investigation.

The intensity of Phase One sets the stage for a robust recovery system, ensuring that every avenue is explored before moving forward.

Phase Two

Upon escalation to Phase Two, the case transitions from our internal recovery efforts to the hands of a specialized attorney within the debtor’s jurisdiction. This shift marks a critical juncture in the recovery process, where legal expertise becomes paramount. The attorney’s immediate actions include:

  • Drafting and dispatching a series of demand letters to the debtor, leveraging the weight of legal letterhead.
  • Initiating persistent telephone contact, aiming to secure payment or negotiate a settlement.

Should these intensified efforts not yield the desired resolution, a strategic assessment is conducted. We then provide you with a clear analysis of the situation, outlining potential obstacles and our suggested course of action.

The goal is to achieve a resolution without further escalation, preserving resources and fostering a more favorable outcome.

In the event that the debtor remains unresponsive or disputes the claim, we prepare for the possibility of entering Phase Three. This preparation includes a thorough review of the debtor’s assets and the likelihood of successful recovery, ensuring that any subsequent steps are taken with a full understanding of the case’s viability.

Phase Three

At the culmination of our structured 3 Phase Recovery System, the path forward becomes clear. Decisive action is required based on the comprehensive analysis of the debtor’s assets and the feasibility of recovery. The options are straightforward:

  • Closure of the case: If prospects of recovery are dim, we advise to close the case, incurring no fees.
  • Litigation: Should you opt for legal action, upfront costs will apply, typically between $600-$700. These cover court and filing fees, initiating a lawsuit to reclaim the full amount due.

Our competitive collection rates are tailored to the claim volume, ensuring a balanced approach to cost recovery.

Upon choosing litigation and covering the initial legal costs, our affiliated attorney takes the reins, pursuing all monies owed. Failure to collect through litigation leads to case closure, with no further obligations to our firm.

Here’s a snapshot of our rates for different scenarios:

ClaimsAge of AccountRate
1-9Under 1 year30%
1-9Over 1 year40%
1-9Under $100050%
10+Under 1 year27%
10+Over 1 year35%
10+Under $100040%

Our approach remains aggressive yet fair, exploring all avenues for recovery while respecting the legal boundaries and ethical standards.

Litigation Recommendations

Case Closure Recommendation

When the prospects of recovery are dim, a decisive step is necessary. Closure of the case may be the most prudent action. This recommendation comes after an exhaustive investigation into the debtor’s assets and the surrounding facts of the case. If recovery seems unlikely, our firm advises to cut losses and avoid further legal expenses.

In the event of a closure recommendation, clients are relieved from any financial obligations to our firm or affiliated attorneys. This ensures a risk-free assessment of the situation. Here’s a quick overview of the possible outcomes:

  • Closure: No further action, no fees owed.
  • Litigation: Upfront legal costs apply, decision to proceed rests with the client.

Recovery of funds is the ultimate goal, but not at the expense of throwing good money after bad. The table below outlines the financial implications:

ActionUpfront CostsClient’s Decision
Case Closure$0Withdraw Claim
Proceed to Lit.$600 – $700File Lawsuit

In cases where litigation is not recommended, clients can opt for standard collection activities or complete withdrawal of the claim.

Litigation Decision

When faced with the decision to litigate, companies must weigh the potential for recovery against the upfront costs. Deciding whether to proceed with litigation is a pivotal moment in the recovery process. If the decision is to move forward, the company must be prepared to cover initial legal expenses, which can range from $600 to $700. These costs are necessary for filing a lawsuit and initiating the legal pursuit of the owed funds.

The choice to litigate should be informed by a comprehensive assessment of the debtor’s assets and the likelihood of successful debt collection.

The following table outlines the collection rates based on the number of claims and age of accounts:

Claims SubmittedAccounts < 1 YearAccounts > 1 YearAccounts < $1000Attorney Placed Accounts

Should litigation not result in the desired outcome, the case may be closed with no further obligation to the firm. Alternatively, standard collection activities can continue in an effort to resolve the debt.

Rates and Fees

Collection Rates

Understanding the collection rates is crucial for evaluating the efficiency of debt recovery efforts. The age of the account and the amount owed are significant factors in determining the collection rate. Legal involvement can also influence the outcome, as accounts placed with an attorney have a distinct rate structure.

Here’s a simplified breakdown of our collection rates:

  • Accounts under 1 year in age: 30% (1-9 claims) or 27% (10+ claims) of the amount collected.
  • Accounts over 1 year in age: 40% (1-9 claims) or 35% (10+ claims) of the amount collected.
  • Accounts under $1000.00: 50% of the amount collected, regardless of the number of claims.
  • Accounts placed with an attorney: 50% of the amount collected, irrespective of other factors.

It is imperative to note that ignoring court-ordered payments can escalate the situation, leading to more stringent recovery phases and potentially higher costs.

A detailed breakdown of collection rates based on account age, amount owed, and legal involvement emphasizes the importance of adhering to recovery phases and the consequences of non-compliance.

Legal Costs

Understanding the financial implications of litigation is crucial. Upfront legal costs are a necessary consideration when deciding to pursue legal action. These costs typically include court fees, filing fees, and may vary based on the debtor’s jurisdiction.

Legal costs can range from $600 to $700, which must be paid in advance. Upon payment, our affiliated attorney initiates the lawsuit for all monies owed. Should litigation efforts not result in recovery, rest assured, you will not be further indebted to our firm or our affiliated attorney.

It is essential to weigh the potential recovery against the initial investment in legal fees to make an informed decision on proceeding with litigation.

Our fee structure is transparent and competitive, designed to align with your recovery success:

  • For 1-9 claims, rates are 30% to 50% of the amount collected, depending on the age and size of the account.
  • For 10 or more claims, rates decrease, reflecting our commitment to volume submissions.

The decision to litigate should be informed by a clear understanding of all potential costs and the likelihood of successful recovery.

Understanding the rates and fees associated with debt collection can be complex, but Debt Collectors International simplifies the process for you. Our transparent pricing structure ensures that you only pay for successful collections, with no upfront costs. To learn more about our competitive rates and how we can tailor our services to your needs, visit our ‘Rates’ section on our website. Take the first step towards recovering your owed funds with confidence and ease.

Frequently Asked Questions

What is the Recovery System for Company Funds?

The Recovery System for Company Funds consists of three phases: Phase One involves sending letters, skip-tracing, and attempting to contact debtors. Phase Two includes forwarding the case to an affiliated attorney for further action. Phase Three involves either recommending case closure or proceeding with litigation, with associated costs and fees.

What are the litigation recommendations for non-payment issues?

The litigation recommendations for non-payment issues include either closing the case if recovery is unlikely or proceeding with legal action, with the option to withdraw the claim at certain stages. Legal costs such as court fees may apply, and if litigation fails, there will be no obligation to pay.

What are the rates for collection and legal costs?

The collection rates vary based on the number of claims submitted and the age and amount of the accounts. Legal costs for filing a lawsuit range from $600.00 to $700.00, depending on the debtor’s jurisdiction.

What actions are taken in Phase One of the Recovery System?

In Phase One, letters are sent to debtors, skip-tracing and investigations are conducted, and attempts are made to contact debtors through various means like phone calls, emails, and faxes. If initial attempts fail, the case progresses to Phase Two.

What happens in Phase Two of the Recovery System?

Phase Two involves forwarding the case to an affiliated attorney who will send demand letters to the debtor and attempt to contact them. If efforts to resolve the account are unsuccessful, recommendations for further action will be provided.

What are the options in Phase Three of the Recovery System?

In Phase Three, the options include recommending case closure if recovery is unlikely or proceeding with litigation. If litigation is chosen, upfront legal costs may apply, and if the litigation is unsuccessful, there will be no obligation to pay.


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