Collecting from a company in trouble

I traveled out of town to a company that needed help with their accounting system. I gave them a discount on the travel time and expense. I did about $1,600 worth of work over about 3 weeks time and sent them an invoice. A month went by and no check. Another month went by and I sent a statement. No answer. Another month goes by and I send another statement asking them to call or at least send a progress payment. Silence. So I called and spoke with the head bookkeeper who promised she would send a check. She lied. No check.

This is clearly my problem and does not seem to be a problem for the company. Small claims court IS an option in this case, but I do NOT want to spend the time it will take. Instead, I spend about 30 minutes drafting a fax to the company. It said something like this:

To: Company President

I am faxing copies of my past due invoices. These are now 5 months old and I have received no payment. 3 weeks ago, you employee promised she would send a check but she lied to me and never sent a check. I can’t afford to write off as a bad debt $1,600. You owe me this money.

Is your company in serious financial trouble? Are you facing bankruptcy? Are your employees worried they will lose their jobs and their health insurance and become unemployed? Are you paying in the payroll taxes you are deducting from their paychecks? How about their 401k deductions? Are you paying those to the account trustee?

Regardless, I need you to pay my invoice now.

That’s pretty harsh, isn’t it? Well, I never intended to ever do business with this company again so I didn’t care. Now comes the part where I REALLY exert the pressure and make this HIS problem. I find several fax numbers for the company on the internet. They have more than one location. I fax this along with the past due invoices to those

fax numbers. Now, I EXPECT these faxes to be received by some low-level employee. That person cannot help but read some of the fax. That is where the company president decides it’s MUCH cheaper to pay me than to deal with a bunch of wound up employees.

I got paid in full in less than a week. Included in the envelope with the checks was some letter from the president complaining about my methods and probably threatening some manner of retaliation. I am a licensed CPA so he could complain to the state Board of Accountancy. I don’t care. I broke no law. What I said was true. I was not the bad guy. He was a deadbeat. I never actually read the letter. I threw it away and cashed the checks.



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