Cash starved businesses fall prey to false promises
Speaking at the Great Southern Business Money Commercial Finance Dinner, Business Money editor, Robert Lefroy, alerted almost 300 professional guests to the danger of their clients dealing with unknown parties offering to secure business finance. “There is a high probability of parting with fees yet receiving nothing,” he said.
“A business owner desperate for funding for their business might receive a telesales call offering them finance and proceed down a path that leads to disappointment. We have received reports from across the country and the methods employed have a common theme. The business owner first signs a registration agreement and parts with £395. This is followed by an agreement requiring a commitment fee of £1,500. A week or so later a valuation appointment is made and a valuation fee of £1,800 is payable though many have commented that the valuer appeared to lack any professional qualifications.
“This is followed by an ever lengthening list of requirements, maybe more payments to be made, but the one common theme to the many complaints reported to the Fraud Intelligence Unit at the National Association of Commercial Finance Brokers (NACFB) is that no funds are forthcoming. Many business owners have parted with close to £5,000 and for nothing.
“When seeking business finance use only brokers that are members of the NACFB,” he warned. “The association has a code of conduct and enjoys the support of most leading business lenders in the United Kingdom.”