Receivership Advisory Services
Cendrowski Corporate Advisors has extensive knowledge of handling business and real estate loans that are in default or foreclosure, and bankruptcy proceedings requiring court-appointed receivership. Our receivership professionals recognize that every transaction is unique. We take a dynamic approach to working with or serving as receivers to prepare and execute a plan to protect operations and physical assets, thereby preserving asset value.
Our most active areas of appointments are real estate litigation and other related matters. Our ability to rapidly deploy resources and in-depth understanding of complex legal and managerial structure allows us to act as a receiver and perform services including:
Cendrowski Corporate Advisors secures all books, records, cash, checkbooks, keys, codes, contracts, permits, and licenses from the debtor/owner and establishes new accounts for cash purposes. Our specialists establish new financial controls and systematically audit all prior financials to establish consistent and accurate reporting to the Receiver.
We perform property, management, and physical plant inspections and make recommendations on deferred maintenance and life safety issues, vendor and supplier agreements, property maintenance contracts, and re-establishing operating requirements to ensure the smooth operation of the business during the transition process.
Receivership Human Resources
After determining the capability of the on-site associates and their ability to add value to the asset, we immediately switch payroll, employment manuals and initiate training to ensure minimal associate displacement. As need warrants, our ability to deploy new leadership and associates is critical to the continued operation of the business.
Client Success: Analyzing a Mail Fraud Scheme
Cendrowski Corporate Advisors was engaged by a receiver to serve as experts and assist the Federal Trade Commission (FTC) with investigating a mail fraud scheme. The alleged defendants would telephone customers, offering to ship “free” samples of their cleaning products, then bill the customers for these products and demand payment.
If the bills were paid, the defendants would ship more unordered products and larger quantities to those customers, seeking additional payments. Customers paid these invoices, not realizing that they never ordered the product. When customers refused to pay for the unordered merchandise, the defendants allegedly used aggressive collection efforts to pursue the collection of purportedly overdue amounts.
Our trusted advisors assisted the receiver with a Temporary Restraining Order (TRO), asset freeze, and shutting down of the company’s business operations. The FTC supported the motion for the TRO with approximately two dozen sworn declarations from alleged victims and the Better Business Bureaus, which received hundreds of complaints about the defendants. We assisted the U.S. Postal Inspector when they raided the defendant’s place of business and conducted an internal onsite investigation. We gained control over the company, shut down the boiler room telemarketing operation, seized image computer hard drives and servers, interviewed vital employees, and reviewed all on-site files and documents.
Next, Cendrowski Corporate Advisors was tasked by the receiver to retrieve the assets of the receivership estate and investigate the complex integrated business operations and financial condition of the defendant’s entities. Working with the FTC, we uncovered several bank accounts being utilized by the named defendants. Throughout all of these accounts, we were able to trace thousands of transactions equaling millions of dollars. Our analysis of the financial records allowed us to calculate the gross revenues this scheme had generated from the preceding five years. We calculated valuable customer and receivables records through analysis of accounting records to see if their businesses could operate lawfully and profitably. We discovered that the business operations and finances were substantially intertwined, with one company paying the credit card expenses of another separate company, which was also in question. We also revealed the company was paying the legal and operational fees for a different entity. Additionally, the receivership defendants used each other’s loan facilities, employees, branding of products, and equipment to operate their various businesses. Based on the commingling of the business interests, the FTC moved to have the company structure collapsed, which provided greater funds to be recovered to satisfy the claims of the victims. In the end, several million dollars were recovered by the FTC.