Roe Taroff Taitz and Portman ID Five Clues a Customer is Not Going to Pay

    BOHEMIA, NY, July 17, 2012 /24-7PressRelease/ -- Most business owners, executives and salespeople simply don't recognize the moment that an account they are selling to goes bad. And when an account goes bad, there is usually a distinct possibility that the creditor may not get paid. To help businesses avoid collection problems before they occur, Roe Taroff Taitz & Portman, LLP, a Long Island law firm, has developed a list of the Five Clues a Customer is Not Going to Pay. Any one of these behaviors individually or in combination should be a red flag that a rogue customer could suddenly impact revenues.

"Most business people don't want to admit that there is a receivables problem, even when the clues are right there, staring them in the face," says Elliott Portman, a partner at Roe Taroff Taitz and Portman who regularly engages in creditor's rights law matters. "But if one or more of these scenarios occurs, it is time to act."

Five Clues a Customer is Not Going to Pay
The attorneys at Roe Taroff Taitz & Portman have identified the top indicators that there may be a problem collecting money due from a customer. While the list is not exhaustive, these have been the most common red flags they have identified when clients come to see them for assistance:

1. Sudden drop in communications.
After having had a wonderful business and personal relationship for a long time with the customer making regular payments, the customer suddenly stops returning telephone calls and/or de-friends you on Facebook and unfollows/blocks you on Twitter.

2. New dispute over old invoices.
When you approach your customer about overdue invoice(s), the customer now has quality issues with the product sold, the price charged and/or makes new claims of shortages. If there has been no prior customer claim regarding of any of those issues, within a reasonable time after delivery of the goods or services, what does that indicate? The answer is often an unwillingness or inability to pay.

3. Broken promises of payment.
When a customer attempts to extend payment terms after the fact, it should be seen as a red flag. The customer patter often sounds like a promise of payment "next week," "after a receivable clears" or "to coincide with the next shipment." Broken promises can also take the form of "I forgot to mail that" or "my Accounts Payable person was on vacation." A wary businessman should see these empty promises of payment as nothing more than smoke screen to mask a cash crunch at the customer's place of business.

4. The C.O.D. check has been dishonored.
Despite a Credit Hold because of non-payment of older invoices, the Credit Department might make the business decision to continue to sell to a delinquent customer. Arguably both parties need each other, badly. In an effort to get a large client back on its feet with the prospect of future profit, the creditor might agree to new sales, but only on a "Cash On Delivery" basis. If the C.O.D. check is dishonored, that should be the last business the parties ever conduct.

5. The phone is disconnected and mail is returned.
Although this might seem more like common sense than a clue, even when unable to establish any form of contact with the delinquent customer, it might not be too late to collect from them. Businesses might close but they don't disappear that easily.

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"Don't walk away from bad debt, try to collect on it. Sue in Small Claims Court if you don't want to engage a professional to collect the debt for you. You never know what might happen if you take affirmative action," urges Portman.

About Roe Taroff Taitz & Portman
Roe Taroff Taitz & Portman, LLP provides a wide variety of legal services to Long Island. Our attorneys have served the residents of Suffolk County for more than two decades. Comprised of attorneys, legal assistants and administrative staff, the firm provides support at various levels of legal expertise. Our resources are available to both businesses and individuals looking for experienced legal representation. The firm's primary areas of concentration include civil litigation, creditor's rights law, trust and estates issues, estate planning, admiralty claims, business counseling and real estate matters. For more information, please call 631-475-4400 or visit http://www.RTTPLaw.com Want to receive more tips like these? Subscribe to the RTTP Law Newsletter at http://rttplaw.com/newsportal/AreasofPractice/tabid/68/Default.aspx

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