Lessons Learned, The Good, The Bad, & The Ugly 20100807
This is a compilation of everything that occurred in our office for the week. It’s an opportunity for you to see what we learned.
We’re pretty good at what we do but we’re far from perfect. You’ll learn that our clients and funding providers are far from perfect too. Hopefully we’ll all learn some lessons on how to do business better.
We’re looking for “Clients for Life.” If you’re looking for a trustworthy, hard working Capital and Cash Flow Specialist perhaps we can do business. With 33+ years of financial services experience (November 1976 to present) we may be uniquely qualified to serve you and those whom you choose to refer.
Please remember that we work on a Priority-Expedited basis and a Non-Priority- Get To You When We Can basis. Not everyone understands our business model and that’s okay. After 33+ years in financial services we can’t please everyone – We do the best that we can for committed paying clients because they’re the ones who keep us in business.
Monday August 2nd:
From Eric to a client that placed $1.8m into the “Have It Your Way” program:
I will contact him at my earliest convenience for an interview.
Never did I say “25%”. The program states 15% right on the summary.
He can earn 80% if he so chooses. That is why it is called the Have It Your Way program. The client decides how to trade and when to trade. He chooses the instrument which dictates the return.
I will get to him sometime this morning. My morning is full, but I will get to him.
More from Eric:
I’m on the phone with Eric. He will prep you for the call with the Trader.
No one is doing anything with in or out of ground assets
Need Ins wrap or working with collateral and off-takes
Communication between Christian and Greg and Greg’s response on MTN’s:
Here’s a Skype string from Christian. Can your provider(s) meet his clients procedures please?
[7/30/2010 1:33:46 PM] Txxx Consulting:
1. BUYER SUBMITS LETTER OF INTENT, CLIENT’S INFORMATION SHEET, COPY
OF THE SIGNATORY’S PASSPORT, FEE AGREEMENT, AUTHORIZATION TO
VERIFY AND AUTHENTICATE FUNDS AND A (TEARSHEET OR BCL) PROOF OF
FUNDS IN VALUE OF €500,000,000.00 (FIVE HUNDRED MILLION AND NO/00
EURO). IF THE BUYER IS NOT AN INDIVIDUAL, A BOARD RESOLUTION WILL
ALSO BE REQUIRED.
2. UPON SATISFACTORY DUE DILIGENCE AND VERIFICATION, SELLER SHALL
COUNTERSIGN THE LETTER OF INTENT WHICH THEN BECOMES A FULL FORCE
3. SELLER OR SELLER’S BANK SHALL DELIVER THE “CERTIFIED CORPORATE
INVOICE OF EURO MTN TO BUYER’S E-MAIL
[22:14:43] Linda: CONTAINING BUT NOT LIMITED TO CUSIP/ISIN
NUMBERS, ISSUING BANKS, DATE OF ISSUANCE, DATE OF MATURITY,
DENOMINATIONS, TEXT OF INSTRUMENT, CUSTODIAL SAFEKEEPING
NUMBERS, EUROCLEAR SCREEN ACCESS CODES, FULL BONDING POWER
INFORMATION, TITLE PAGE, CUSTODIAL BANK AND BANKER
INFORMATION, ETC. (NOTE: “PRIVATE PLACEMENT” TO BE SHOWN ON ALL
THE INVOICES. PRICE SHALL BE SHOWN ON CORPORTATE INVOICE AND NO
PRICE SHALL BE SHOWN ON SCREEN.
4. UPON VERIFICATION AND AUTHENTICATION OF THE CORPORATE INVOICE,
BUYER’S BANK, WITHIN FOUR TO EIGHT (4-8) INTERNATIONAL BANKING
HOURS SHALL RELEASE THE FUNDS FOR SETTLEMENT VIA EUROCLEAR
SCREEN BLOCK AND PAY. UPON EVIDENCE OF SETTLEMENT, THE
INSTRUMENTS WILL BE LEDGER TRANSFERRED TO BUYER’S ACCOUNT WITH
THE BANK TO BE NAMED OR OTHER BANK TO BANK ARRANGEMENT.
(BUYER’S SETTLEMENT BANKER IS ABLE TO CLOSE LEDGER TO
LEDGER WITH SELLER’S CUSTODIAL BANKER SHOULD SELLER AGREE.)
5. THE HARD COPIES / BOOK ENTRIES WITH HARD COPY OF THE MTN TO BE
DELIVERED VIA BANK BONDED COURIER TO THE BUYER’S BANK WITHIN
SEVEN (7) DAYS AFTER THE PAYMENT BEING RECEIVED BY SELLER’S BANK.
6. ALL SUBSEQUENT TRANCHES WILL BE BASED ON THE SAME PROCEDURE
UNTIL COLLATERAL OR CONTRACT BECOMES EXHAUSTED.
[7/30/2010 1:34:14 PM] Txxxx Consulting:
AND WILL THE ABOVE BE ACCEPTABLE TO YOUR PROVIDERS ??
[7/31/2010 11:24:13 AM] Joe Tufo: MTN yes, it’s been in the emails that I sent last week.
[2:54:36 AM] Txxxx Consulting: see the procedures above and confirm if it will be workable for your Provider
Yes that’s fine. Any method of acceptance and delivery can be negotiated however we will need POF
It does not matter who the client is-they still have to provide documentation of Proof of Funds upfront before any further process.
Send LOI with buyer’s procedures and POF. After review we can forward elements of the asset direct to the buyer.
We can do Proof Of Funds via Attorney and/or Compliance Officer with Bankers-Allocation Commitment Holders as per S.E.C./F.S.A. Compliance, Regulations –
YOU HAVE MY CURRICULUM ?
(Two (2) Banker signature SKR Letter) – Bank to Bank for further validation of funds, however we would need POF as an introduction.
This can be can be a Sanitized recent Bank Statement or Tear Sheet (White-out or Black-out account numbers).
Feel free to call my office anytime for clarity.
Monday, August 2nd: From Ali to me
I’m looking for 100 M or 10 M as the Cash account and do MT760.
Below is the info from your friend Jay: can you ask him the pricing and which Banks they can send the MT760 from.
From my friend Jay:
We are excited to tell you that we are now offering SWIFT services! please see attachment.
The #1 provider for POF, Swift, and Banking Instruments.
SWIFT SERVICE OUTLINE
We are proud to announce our newest addition to our product and service offerings. Due to our growing capacity and continued success, we are now able to offer SWIFT services to you and your clients. Below are some outlines of what can be done. Feel free to contact us for any of your questions.
Flexible verbiage. Include dollar amounts, contract numbers etc.
Save on costs; bank institutions typically charge large fees compared to us.
Send and receive swift, 24-72 hours at times.
We are able to provide the instrument if one is not provided.
We are proud to offer swift service now even for your own instruments.
A any swift for your purpose. Most popular swifts include:
Request letter: Provider will need to contact principle for validation.
SWIFT Agreement notarized
Have receiving coordinates
Verbiage of swift
Supply instrument e.g.
Color copy of passport
Pricing is on a per case scenario. Contact for details.
Monday, August 2nd:
From Arthur, a Hollywood Producer of 40+ years whom I know:
Both Rose Marie and I, want to thank you for bringing the SARKIS SHOW Project to our attention. For your information we will be informing and sending the Syndicator/Distributor, the Shows we are currently Producing in the very near future, so that the Syndicator/Distributor can document and put everything in place for the SHOWS distribution.
So you must inform SARKIS that its to his advantage to get his project to us, so that we can move and decide on it. For the sake of clarification; you must further inform SARKIS that we have taken an interest in his project because of your involvement and recommendation.
Also Joe, if you should come across any other viable projects, please submit them as we will be happy to analyze them with you, and if viable, structure a deal.
Have a Good Day, and Best Wishes.
Arthur and Rose Marie
Monday August 2nd:
This came in from a Lender I know:
Cxxxxx BANK OFFERS LOW FIXED RATE APARTMENT AND HEALTHCARE FINANCING NATIONWIDE, LOANS OF 2 MILLION AND UP
FIXED 10 TO 35 YEARS
LOAN TO VALUES UP TO 83.3% ON APARTMENTS
CORRESPONDENT LENDING ON OTHER LOANS AS WELL.
NOW ASSISTING HIGH NET WORTH BUSINESS AND INDIVIDUAL BORROWERS WITH LARGE LINES OF CREDIT, TERM LOANS AND OTHER CORPORATE STRUCTURE, ON REAL ESTATE AND BUSINESS NEEDS.
CALL WITH YOUR LOAN REQUESTS AND LET US HELP YOU ACHIEVE YOUR GOALS.
Keith sent this in answer to my questions Tuesday August 3rd:
As for credit lines or credit facilities they are based on assets, cash flow, collateral and purpose. Typically we prefer owner occupied credit facilities of 10 million plus. Real estate investors or developers will have a harder time than some other profession. Credit facilities can range from 3 years to 7 years depending on request and whether deposit relationships are being offered. Rates vary from business to business and collateral type.
As for the redlined areas we are limited in what we can do in Las Vegas, Phoenix, parts of Atlanta and the State of Florida. Michigan and Ohio are on a case by case basis. Below is typical of what we like to see. Protocol would be to send an executive summary, photos and the financials on the operating facility and entity.
PRELIMINARY SUBMISSION PACKAGE: Include the following in your request for a loan quote:
1. Property description and location map.
2. Number of units with breakdown of proposed rents by unit type.
3. Current rent roll and year-to-date operating statement.
4. Operating history – prior 3 years, if available.
5. Current year operating budget.
6. Existing debt and purchase price.
7. Sponsor resume.
August 2nd from my friend Dane:
Are you interested in working with a trade platform that can document its ability to perform?
Have you had an interest in “trade programs” but have been lead astray by a daisy chain of non-performing brokers making claims to their trade platforms?
Has a broker ever been willing or capable of showing you actual performance of their trade platform?
We can for those who qualify!
Qualified eligible clients can participate with a minimum investment of Five Hundred Thousand Dollars
I thought you may take a little solace in knowing there is a real trade platform that’s capable of documenting performance of triple digit returns.
We make introductions between qualified eligible principals and a trade platform that is totally transparent. In fact I have known the CEO personally since October 2007.
Our trade platform can document triple digit returns for those who qualify; best of all with our no-nonsense approach, qualified principals work directly with the principals of the private placement platform. We can work with clients from all over the globe.
Our private placement program trades at institutional levels in One Hundred Million Dollar, Five Hundred Million Dollar and Billion Dollar tranches. A unique component of our Trade Platform is that we can offer direct access to the documented performing trade platform for our qualified clients at much lower levels because we compile investors through joint venture agreements to fill the large trade platform offerings. However, each qualified trade platform investor receives their own agreements directly from the platform.
As there are no brokers involved the qualification process is very simple and does not take long; if the established procedure is followed, typically all it takes is one or two weeks to actually be in trade! $500,000 minimum.
Interested principals are to complete a qualification questionnaire. If the principals are initially accepted, they will be provided with a letter of commitment. The next step in the qualification process requires accepted principals to move funds to an escrow account with a major bank or commercial escrow firm of the principals’ choice.
Occasionally, principals elect to use an escrow firm which has been used in the past; those principals may contact J&K EPS.
Soon after the principals escrow deposit has been verified, the due diligence process begins for anti-money laundering and Patriot act compliance.
Once the third party due diligence process has been completed successfully, the principals will be provided with a formal invitation to participate directly from the principals of the trade platform, which includes a private placement memorandum and applicable disclosures.
From this point on the principals are working directly with the principals of the private placement program.
At this point conference calls and face to face meetings are welcomed which allow the principals to complete their own due diligence on the private placement program and its principals. The platform is happy to share historical performance related information with the qualified eligible principals.
This came in Monday August 2nd from a Business line of Credit provider whom I know:
We just found a new Non-Bank Direct Lender that that is currently approving 73% of all Unsecured Business Financing Applications, even in this Market. They are a relatively new Player in the Market but they are hungry to lend money.
This is Limited-Time Unsecured Financing Program offered exclusively through TLBS and is designed to provide Working Capital to Small/Medium-sized Businesses.
The Underwriting is based primarily on your Business Bank Statements and the Minimum Personal Credit Score is only 550.
The Financing will be structured as a 12-Month Business Cash Advance with Weekly Payments taken directly from your Business Bank Account. This is the only Program of its kind and is not available through any of our Competitors!
- Up to $250,000 / Rates from 12% to 18%
- No Upfront Fees / No Points
- No Tax Returns / No Hassle
- No Use Restrictions / No UCC Liens
- Flexible Payment Terms / Lowest-Rate Guarantee
- 73% Average Approval Rate!
THIS IS NOT EASY TO FIND!! Banks are tight right now, but these guys have strong financial backing and they are lending aggressively.
I sent this Thursday August 5th to Seth who was trying to monetize CMO’s. This may help you as well:
Asset Monetizing Process & Procedures,
(No Bearer bonds)
NO CREDIT CHECK! NO INCOME DOCUMENTATION! NO APPRAISALS!
These loans can be a line of credit, or a margin line against the asset. For stock loans we have the ability to implement a synthetic hedge against margin calls at a nominal cost to the borrower. These loans can be 100% Non Recourse to the borrower. Loans can go as high as 95% of the value of the portfolio. It is important to note that we prefer to move all securities that are being considered for a loan to our investment banking relationships, this avoids many of the problems in inherent in these investments and allows us to get to funding much quicker.
Perfect for the borrower who does not want the lengthy unpredictable underwriting associated with a real estate loan.
Send over a copy of the Paper Assets;
If available or send the CUSIP or ISIN Numbers. CIS Form (Request CIS Form & Recitals) and a Statement as to where the asset is held and how much of the asset the client owns.
We need a complete statement of the asset (who, where, how it’s held?)
A complete statement that shows the client’s info, how it was mailed, and the positions.
No internet statements.
The statement will come from the Bank or Institution for which it is held.
If it is not from a Bank or Institution we can not use it.
It also has to be on the Market with Liquidity and Trading value.
NO STATEMENT- NO DEAL
(PLEASE PUT THE LAST NAME OF OWNER OR FUNDING ENTITY AND ASSET IN THE E MAIL SUBJECT HEADING)
We will review and want the borrower on the phone ASAP, with the Underwriter and or Banker.
Our disclosures will be forwarded to the borrower – we need to know the fees that need to be included on the broker side.
A conference call with the client will be scheduled.
To further after the call we will request financials on the Borrower / Company.
We will send the application to the client.
NO UPFRONT FEES
FAST CLOSINGS 3 DAYS TO 1 WEEK
When the securities are transferred we will then work to monetize them with in 3 days for the account being opened,
This usually closes in a week.
Loan against market value,
Up to 95% at 1.5% Interest Only over 90 Day LIBOR
High Yield Collateral Enhancement Programs & JV/Debt
The proceeds from the Monetizing Process can then be placed into our High Yield Collateral Enhancement Programs for further monetizing and Take-Out of Loan, or can be used as the collateral for our JV/Bond, JV/Equity, or (SCLP) Program for further project Development.
Please put the last name of principal or funding entity in the subject heading and Type Of Asset and be consistent in all Emails.
This is how the deal will be filed.
For further details of the process please feel free to contact my office.
With Warmest Regards
Cash Flow Specialists, Inc.
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I spoke with Alex, one of our Large Project funders Thursday August 5th. He told me they would begin funding our clients next week.
I sent this August 5th to Pat who has a client that needs to monetize a $20b instrument:
Do you need to monetize an instrument?
Tod represents a Private Saudi Investor. He makes loans against BG, SBLC, CD, Bank Drafts and Sovereign Bonds. His typical loan term on “AA” graded instrument is 90% of face amount, 2 pts stay to the lender, 2 pts get broken up to all active intermediaries, the client nets 86%. At the end of the one year term the client pays back the 90%. NO INTEREST, keeping with his Private Investors Islamic beliefs. Lessor rated instruments are discounted more.
As a lender he will NOT provide a letter stating he has the ability to fund this NOW or in the future. There are many reason for this, but the two primary reasons are 1-this would be perceived as solicitation on their part, which would be a liability on their part. 2-In cases when people are asking for these it is sometimes that the instrument is being issue on their ability to fund it.
We need the client to come forward first with a KYC and RWA. See attached. Please have the RWA made out to the projects name and/or client.
After we receive this we will spend 24-48 hours to vet the client and transaction after which we will get the client on the phone to outline loan terms. If acceptable to the client then we issue a LOAN AGREEMENT and MFPA. Upon receiving both back we move to close.
For the sake of full disclosure, please let the client know that we actually fund from cash and/or a credit facility and after vetting the transaction will determine whether we fund from the USA, Switzerland, Liechtenstein, UAE or Jordan bank. This will be identified in the Loan agreement and everything from that point will be handled bank to bank.
Hope this meet with your and your client favor and look forward to the closing of this loan.
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DISCLAIMER: Sender is NOT a United States Securities Dealer or Broker or
U.S. Investment Adviser. Sender makes no warranties or representations as to
the Buyer, Seller or Transaction. All due diligence is the responsibility of
the Buyer and Seller. This e-mail letter and the attached related documents
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Friday August 6th Anthony and I spoke with Dane who is a principal for a trade program.
Dear Mr. Tufo,
I understand you’ve stated the principal Mr. Nxxxxxx, has had to deplete some of his reserves to keep things running which is a normal function of business.
In a demonstration below based upon actual historical performance related data (PAST TENSE) for one of the offerings in the platform, If an allocation of Two Million Six Hundred Thousand Dollars ($2.6m USD) had been made in Jan 2009, the funds in the investors capital account would have grown to north of Thirty Six Million Dollars ($36m USD) over the course of a 17 month timeframe.
It’s important to understand this is based upon a cash in and cash out scenario; the numbers are inclusive of applicable management and performance related fees accessed by the Fund and the traders, however not inclusive of any related fees you or MBA would be entitled to based on contractual agreements to be lodged with a paymaster lawfirm.
Unfortunately, this is not indicative of future performance (FUTURE TENSE), however this is a realistic look-back which is not hypothetically based, rather based upon actual performance on the basis of the allocation of $2.6m USD by a qualified eligible person traded over 17 Months within the enhanced leverage share class in the Fund. I’m sorry that I do not have the numbers for July incorporated as of yet; but, this give the most up to date information I have as of this particular juncture.
The above screen shot containing past performance numbers is not intended to be used for purposes of inducement. On a review of the numbers in column K above, it should be clearly advised that there are draw-downs (losses) which are a further indication that this scenario DOES involve risk. Increasing leverage increases the risk. This and related product are only available to and for QUALIFIED ELIGIBLE PERSONS (*QEP). Past performance is not indicative of future results.
The chart did not transfer, but if you want a copy you can write me and we will have one prepared exclusively for you. The minimum investment is $500,000.
As always we’re available M-F 7AM to 5PM Pacific to serve you and those whom you choose to refer.
Our websites are at:
Joseph P. Tufo, President
Certified Cash Flow Consultant, Certified Capital Specialist
CASH FLOW SPECIALISTS, INC.
P.O. Box 844
Alamo CA 94507
925-691-8200 Direct to my desk
Let Us Help You Get Funded:
Google Talk: firstname.lastname@example.org
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Private Client Services $5,000 to $50,000,000+, Business and Personal Lines of Credit $500,000 to $14,800,000, Large Project Funding $20,000,000 to No Limit, Commercial Loans, Hard Money Loans, Asset Monetization, Proof Of Funds and More.
We make NO INTEREST loans against BG, SBLC, CD, Bank Drafts and Sovereign Bonds.
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