Tag: Legal

When a customer doesn’t pay, it sends ripples across a company as it stifles cash flow, weighs on its receivables and strains the relationship. It’s hard to decide the right course of action for addressing these customers, but certain cases will have credit managers grasping for a solution that keeps them out of the courtroom. Despite a creditor’s wishes, sometimes there is no other path forward.

In business credit, a single word can carry a lot of weight. Wording in a contractual agreement, for instance, can mean the difference between getting paid and absorbing a loss. Even something as simple as a misspelling of a legal entity name can complicate the protection of a creditor. 

Nothing sparks more worry in a credit manager than a customer who suddenly begins slipping. When payments start coming later and later and communication becomes increasingly strained, it may be time for proactive measures to protect your company should they file for bankruptcy.

Business credit law is fundamental to credit risk management, often marking the difference between secured funds and significant financial loss for a company. Although credit professionals exercise legal judgment daily, gaps in understanding remain, and constant regulatory changes can widen them further.  

A recent arrest tied to a significant fraud ring highlights the powerful results that can be achieved through advanced risk management, real-time intelligence and coordinated teamwork. On Friday, March 20, law enforcement apprehended suspects in Forest Hill, Maryland, marking a major milestone in an investigation that directly impacted NACM-member businesses.

No matter how sound your credit policy or how thorough your practice, bankruptcy can strike without warning. One day your customer is current and the next, they’ve filed. And when they do, the payments you worked hard to collect could be at risk of being clawed back through a preference claim. 

Construction credit is a highly volatile business, in which risk is contingent on the project’s progress and outcomes. Cash flows down the “ladder of supply,” a tiered structure that determines when each stakeholder receives payment. With suppliers at the lowest tier, credit professionals are typically the last to obtain funds.

The U.S. Postal Service clarified in a Dec. 24, 2025 rule that postmarks reflect when mail is processed at a USPS facility — not when it’s dropped off, accepted at a counter or stamped in a mailroom.

Credit professionals handle confidential information day-in and day-out as they manage customers and work to mitigate risk. While confidentiality comes with the job, it is critical that credit managers understand what can and cannot be shared with those outside the credit department, whether they’re talking to a member of their sales team or a credit manager from another company.