The Entrepreneur's Constant Nightmare

The Vendor Client relationship - in real world situations

The largest part of my practice is work for small businesses and their owners, and I can tell you that this is a very accurate reflection of the problems created by that breed of customer / client who expects Cadillac work for bicycle prices and thinks that the business should be grateful for the privilege.

LawPro Warning to lawyers re equipment loan fraud

LawPro tells the profession:

Our LAWPRO E-News mailing last week prompted several calls from
Ontario lawyers. From information we have gathered, it seems
clear to us that there is an organized scheme underway to
defraud Ontario lawyers using matters involving small business
equipment loans. These matters all share the same basic timeline
and circumstances, and in some cases, the same purported
individuals or entities (a lender from Halifax).

In all cases, about one month ago a previously unknown client
retained the lawyer to do an incorporation. The client presented
realistic looking photo ID (a newer Ontario driver licence). The
client paid in full for the incorporation.

In the last week the client returned to the firm asking the
lawyer to act on an equipment purchase loan matter. Loan amounts
are approximately $350,000 and the loan is to come from a
Halifax-based lender (there is someone answering the phone for
the lender - we suspect the fraudster or an accomplice). The
client is pushing to have the loan completed as quickly as
possible. The loan proceeds are to go to a third-party
corporation (not the client's new corporation).

There are clear badges of fraud in the above scenario. The
lawyers' suspicions were also raised for one or more of the
following reasons: the client and corporate addresses were the
same; it is unusual for a brand new corporation with no apparent
purpose to get a loan in this amount; the only security for the
loan was a promissory note or GSA; the client had only a cell
number or the home phone number given was not working, and the
address on the driver's licence is not a real one.

Over the past year, almost twenty of these types of fraud
schemes were reported to LAWPRO during the various holiday/long
weekend times. Please be wary if you are handling a matter that
appears the same or is similar to the ones described above.
Clearly there appears to be an organized fraud scheme targeting
Ontario lawyers. We encourage lawyers and their staff to be
extra careful in the next few weeks. Remember that these are
very sophisticated frauds. The letters and other documents
provided by the client and the certified cheques or money orders
received from the lender will look legitimate - but turn out to
be counterfeit. Cross-checks and searches on the names,
addresses, serial numbers or other information in the
documentation provided will prove to be false.

Please read LAWPRO's new Fraud Fact Sheet at
http://www.practicepro.ca/practice/pdf/FraudInfoSheet.pdf to
learn more about the red flags to look out for. Or see the
practicePRO Fraud page http://www.practicepro.ca/fraud for
information on fraud and how to avoid it.

"Six Ways to Stall Estate Planning"

I recently came across an interesting article, "Six Ways to Stall Estate Planning" [PDF] by Thomas Junkin, Senior Vice President of the Fiduciary Trust Company of Canada. In it he examines six mental roadblocks we run into, internal barriers blocking us from our estate planning. While the short summary below is useful it is no substitute for reading the whole two-page article [PDF]; it contains much that anybody who must ponder estate planning (which is pretty much everybody) should know.

1. "I am too busy to worry about estate planning right now."
Don't fall into the trap of thinking that estate planning is neither important nor urgent, Junkin urges: while proper estate planning does take time it is necessary to deal with its complexity immediately. This is especially important in light of the fact that estate planning isn't an exercise in fill-in-the-blanks will preparation, especially in this era of blended families, rapidly changing family law rules and increasingly complex potential decisions.

2. "Thinking about death, especially my own, is frightening."
Yes, it is, no question about it, but it need be faced. That's why I always open my presentations on wills and estates planning [PDF] with this:
Junkin wisely suggests that you make estate planning an intellectual exercise rather than an emotional one. It is difficult, because thinking about executors, beneficiaries and guardians for one's children is an emotional issue. But properly structuring the planning makes it easier to deal with it.

3. "I am confused and intimidated by the complexity of estate planning."
Junkin cautions against falling into either of two extremes: being so disinterested in the fine points that one doesn't proceed, or being so details-oriented that one seeks to become an expert before proceeding. I have been an advocate for some years of detailed estate planning questionnaires which allow people to move through their process at a steady, measured pace which they can adjust to their own comfort level.

4. "My family relationships are strained."
"Awkward family situations lead to procrastination in two ways: Fear of confrontation with your family members, and fear of discussing potentially embarrassing family matters with someone outside the family." Junkin and I are in agreement on the importance of using the skills of your estate planner to help you resolve these emotional dilemma: working with somebody who will help you through these difficult decisions makes those problems solvable.

5. "I think estate planning must be very expensive."
It doesn't have to be expensive, but it will cost money to do properly. It's baffling to many lawyers that people who will not hesitate to spend $1,500 to fix a broken head gasket on their car will balk at spending $400.00 for properly done wills and powers of attorney. You can always take a taxi if the car doesn't work; you can't raise yourself from the dead to retroactively do all of the things for your family that you should have done when you were alive.

6. "I don’t know what I want to do with my estate."
This is where a estate planning in cooperation with your solicitor is vital. Much of the uncertainty comes from not knowing where to begin: many people don't even know the questions to ask, and it's the questions that provide the answers. Find a solicitor who will work through the whole process with you and who can provide access to specialized advice and services (financial planners, etc.) where required for the more sophisticated estates.

Mr. Junkin invites readers to go to Fiduciary Trust's Perspective library and browse their past articles and download copies.

Drug Decriminalization Policy Forum - 2nd Follow-up

In a follow up to this post, and this followup to that post, American civil liberties writer Glenn Greenwald is interviewed by Reason.tv, an American libertarian website: