Dunn Consulting will provide professional expertise in determining the accuracy of the accounts receivable, the proper ageing of the receivables and the reasons for being delinquent.

Another source of cash flow is those accounts that have been charged off due to serious delinquency issues, accounts that have filed bankruptcy, etc. The use of a third party collection agency is of particular importance and is most useful in obtaining settlements or full payment of the accounts.

The FDCPA, or Fair Debt Collections Practices Act, is a set of consumer protection guidelines. Third party collection agencies must follow these guidelines in their collections practices, and most companies that don't outsource their collections activities choose to follow these guidelines as well.

The regulations set forth by the FDCPA vary slightly depending on what state you live in. Example, in some states you can only be called at work once a month, in others you can be called at work every day. However, all states allow you to verbally request no further calls at your place of employment. If you wish to not receive collection calls at home, you have to put your request in writing. This is called a "cease and desist" letter.

The FDCPA states that a bill collector may not be verbally abusive, make empty threats, use foul language, or harass you. The FDCPA considers multiple identifying phone calls in one day to be harassment. However, this does not mean that if a bill collector calls you and you don't answer they can't call you back that day - but if the collector identifies their company, either on a voicemail or in a conversation, they may not call you back that same day.

The FDCPA also states what legal actions are available in each state. In Louisiana, for example, a vehicle is sent to the repossession department when it reaches 32 days past due. In most states, this does not happen until the loan goes over 60 days past due.

If you can prove that a company has violated the guidelines set forth in the FDCPA, you can seek legal action. If the collections are "1st party" (not a 3rd party collections agency), make sure the company has chosen to adopt the FDCPA regulations. Most companies have. For example, Citibank, Household Finance, and Capital One all have their own collections departments, but have chosen to follow the FDCPA guidelines.

To read about more about your specific rights under the Fair Debt Collections Practices Act, visit http://www.ftc.gov/os/statutes/fdcpa/fdcpact.htm.

In addition to a commission plan, it is important for a company to provide written procedures and guidelines for the collectors to use on a consistent basis. These procedures will provide a systematic approach to the collection process, ensure adherence to FDCPA guidelines and provide a measurement tool to track individual collection efficiency.

After exhausting normal collection efforts, it may become necessary to assign those accounts to third party such as a collection agency or an attorney. Dunn Consulting has used both and these methods can be very effective in maximizing your cash flow. An example of this would be the collection of almost $3,000,0000 by a third party collection agency after placing $11,000,000 in paper with them. This collection duration was slightly over one year, had an average ageing of over 1,000 days and included both charged-off and delinquent accounts. The company recovered $2,600,000 net of commission.

For more information about Dunn’s Business Debt services, please contact Dunn Consulting Group at 401-465-2742.