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Shaw Capital Management and Financing offer a complete line of factoring services, purchase order funding, and asset based financing, accounts receivable management, and other related financial services.One of the biggest challenges facing businesses in the current economic climate is getting invoices paid and the use of invoice factoring could become a significant area for fraud, according specialist fraud lawyer Arun Chauhan of Midlands firm Challinors.”In the current economic climate the use of factoring is becoming more prevalent,” says Arun, aPartner at Challinors and head of its Fraud & Asset Recovery department. “The problem of getting invoices paid is a growing problem and an increase in fraud in Factoring is an area that will not be immune from this threat.”The issue of invoice payment is not unique to the economic climate but one that is encountered by all businesses and in particu fiat currency lar start up businesses. Factoring is the selling of a company’s invoices, at a discount, to a ?Factor’ – typically a financial institution – which then assumes the credit risk of the account debtors and receives cash as the debtors settle their accounts. The company then receives the value of the invoice less a percentage retained by the company as their fee for the factoring service.”The Factor will typically obtain a personal guarantee or some form of security from a director of a company before commencement of any agreement,” explains Arun.There are two specific types of factoring – Open and hidden factoring. In Open Factoring the company does not mind if its customers know if they are using a Factor. The debtor is sent invoices by the Factor to recover the face value of the invoices.If a company has decided to Factor invoices to improve cash flow, it may wish to keep this from its customers.