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March 26, 2001
Headlines: "Went to Kansas City"---United Association of Equipment Leasing Funding Symposium SunTrust Credit Automates Small Business Lending with eCredit.com
www.sex.com
( nothing to do with
the leasing industry!!!! ) Opportunity for Leasing Companies to Grow---- FICO Scores---Archie Julian Willis Lease Finance Sets Quarterly Record With $88 Million in Additions to Lease Portfolio
Extra--- New Release: DUIT!Broker 3.0 is designed for brokers and funding sources Shepard Says, "Touch Your Mouth, and Sell Your Stock, Buy Bonds." Used Equipment---We Get Calls----Why??? Special Report/This Friday " Why eLease Companies are Failing? " Part I all press releases have ############ as header and bottom border ---------------------------------------------------------------------------------------------- PinnUSA Leasing ( Mortgage/Leasing Fraud Charges Probed: A federal judge appointed a special master to investigate government charges that Carlsbad-based PinnFund USA Inc. perpetrated one of the largest Mortgage frauds in recent years. Securities and Exchange Commission officials say Chief Executive Michael J. Fanghella used $107 million in investor funds to pay for a lavish lifestyle that included $10 million in gifts for his porn actress girlfriend. Regulators accuse Fanghella and associate James L. Hillman of Oakland of issuing phony accounting statements to disguise the transfer, as well as $95 million in business losses. The SEC wanted the PinnFund and related funding entities such as PinnLeasing shut down, but the judge's order allows it to continue operating pending the special master's findings.) "Too Good to Be True" A few years back we were approached by a broker to lease $250,000-300,000 of PinnFund's new office furniture and computers, etc. for the opening of their Chicago office. The financial's looked fine, but there was hesitancy on our part because they did sub-prime mortgages, and we were concerned if they'd be able to continue to sell off their sub-prime paper [this was just after the Mercury Finance (sub prime auto paper) thing unraveled (Mercury Finance was cooking the books) in the Chicago area]. The real kicker was the transaction was submitted with full financial disclosure and audited statements etc., and the all-in yield on the transaction was in excess of 20%. So we reasoned they were not very good business people if they were willing to pay 20% with the strength of their financial's or someone was asleep at the switch (management had no financial controls if they were willing to pay those rates that the broker negotiated). So if it walks like a duck and quacks like a duck, then it's a duck, or if it's too good to be true, then it is. It just seemed like one of those credits where one says to himself, "This is a house of cards". It looks like we dodged a nice size bullet. Thanks for the updates. Gary G. Trebels, CLP Vice President IFC Credit Corporation GTREBELS@IFCCREDIT.COM ======================================================= United Capital Kudos to Kevin Pane of C2 Capital for actually having the guts to tell it like it is about United's business practices. (http://www.leasingnews.org/archives/March01/3-22-01.htm) This
is how we can avoid the crooks
like United. If I see anonymous I disregard the Michael Duhamel Zaxon Entreprises, Inc. 110 Country Club Dr. Suite 4 Incline Village, NV. 89451 775-832-8279 775-832-8278 www.zaxon.com ---------------------------------------------------------------------------------------- "Went to Kansas City...." I attended the UAEL conference in Kansas City Friday. Attendance was not large but the important thing for me was hearing from Chuck Brazier (UAEL president) and Bob Fisher (Vice President) about the changes they are making at UAEL. I had previously decided not to renew our membership this year because of shortcomings that I'd seen in recent years with the association. I'm so very impressed with their game plan that we're renewing. I think that the industry needs the UAEL and I'm excited for its future. Kevin F. Clune kclune@clune.net Clune Equipment Leasing L.C. ---------------------------------------------------------------------------------------- ########################################################## SunTrust
Credit Automates Small Business
Lending with eCredit.com; Nationwide
Rapid Credit Decisions Using Highly-Configurable eCredit.com Technology
DEDHAM,
Mass. & LITTLE ROCK, Ark.--(BUSINESS
WIRE)--March 26, 2001-- Credit
Corp. today announced that SunTrust
Credit is `live' with eCredit.com
credit software for automated approval of small business financing and revolving lines of credit. SunTrust Credit, a commercial specialty finance company, is a wholly-owned subsidiary of SunTrust
Banks, Inc., the ninth largest
commercial banking organization
in the U.S., Using eCredit.com technology, SunTrust Credit receives applications for business financing through its various sales channels. Transactions up to $75,000 are automatically processed by eCredit.com software to determine in seconds whether credit should be granted, referencing outside information sources and using scorecards customized by SunTrust Credit to reflect the company's risk tolerance. This type of credit decision has traditionally taken days to manually process. Automation of the credit decision not only provides speedier, consistent results, but also frees credit analysts to focus on difficult or higher-value transactions, while the resulting aggregated data allows SunTrust Credit to identify and target its most profitable customers. "In these volatile economic times, every financial institution needs the flexibility and processing power to closely manage its credit policy. We chose eCredit.com because its technology allows us maximum control of the credit decision process with greatly improved efficiency," said Scott Hastings, SunTrust Credit president and chief operating officer. "In essence, eCredit.com technology allows us to perform our usual thorough credit decision analysis, but in a fraction of the time and with more consistency across our business." With eCredit.com software, SunTrust Credit can process applications directly from the desktop, whether entered by credit analysts or loan officers. Also, using the Internet for direct applications not only eliminates errors and speeds processing, but also helps SunTrust Credit accommodate the growing number of small businesses leveraging the Internet. According to a recent report by analyst firm International Data Corp., the percentage of small businesses accessing the Internet is expected to climb to over 70% by 2003. According to Peter McKay, president at eCredit.com, "More and more, financial institutions are recognizing the benefits of credit decision automation for credit process efficiencies and risk management.
Adding a leader like SunTrust
Credit as an eCredit.com customer
affirms our eCredit.com decision solutions enable credit-granting organizations to automate their traditional credit and underwriting processes, pro actively manage risk and speed time-to-market. By consolidating customer information in a single repository, eCredit.com helps credit-granting organizations to qualify, acquire and retain customers and pro actively manage credit risk. eCredit.com decision solutions also provide a flexible platform for managing multiple score cards, consolidating existing legacy systems and taking applications from more than one point of origination. About SunTrust Credit Corp. SunTrust Credit, which specializes in small business financing, is a wholly-owned subsidiary of SunTrust Banks, Inc., the nation's ninth largest commercial banking organization. SunTrust Credit provides small business financing through various loan and lease products that are customized to meet the specific needs of its customers. Its products include a selection of term loans, leases and both secured and unsecured revolving lines of credit. The Company offers it services in all 50 states. SunTrust Credit is a Nevada corporation with offices in Little Rock, Ark. and Reno, Nev. For additional information, visit SunTrust Credit on the web at www.suntrustcredit.com. About eCredit.com eCredit.com
enables Fortune 1000 companies,
financial services organizations
and relationships, increase customer purchasing power, and grow the bottom line. eCredit.com solutions automate credit and underwriting to better manage risk and deliver a portfolio of financing options at the point-of-sale. Included among the Company's customers and partners are CIT, Eastman Chemical, GMAC, Fleet Leasing, Gateway and Ryder System, Inc. eCredit.com, headquartered
in Dedham, Mass., is a member
of the Internet Capital Group
(NASDAQ: ICGE) The eCredit.com logo is a trademark of eCredit.com. CONTACT: eCredit.com Roopa Bhide (781) 752-1275 roopa@ecredit.com ############################################################ ------------------------------------------------------------------------------------------ Lenders on the Internet Have Problems-----a Preview from Venturewire.com Homes.com LLC Files for Chapter 11 Bankruptcy MENLO
PARK, Calif.
-- Homes.com Inc., a
provider of marketing and productivity
Chapter
11 bankruptcy. According to
the company's attorney David
Caplan, out,
and rather than fight it out
court, they decided to take
the Chapter 11 route,"
said.
Homes.com Inc. announced last
week that it laid off 150 employees,
40% restructuring,
but it is completely operational,"
said Mr. Caplan. Homes.com Inc.
million
in its Series A funding in March
2000 from investors including
Venture Partners, Kinetics Ventures, and Lighthouse Capital.http://www.homes.com/ ----------------------------------------------------------------------------------------- www.quickenloan.com Hey Kit! The only complaint I have is that I am tired of listening to people whine about the information you print that is "not relevant" (according to them). How can it possibly be smart to limit your "information intake" to the equipment leasing business only. We are in the commercial lending and finance sector, and almost everything that happens in it should be of interest to us. Much of it affects us directly, or has the potential to in the long run. How many of our clients use Quicken or Quickbooks? What do you tell them when they ask you about quickenloans.com? "Uuuhhh, what's that?" Get a grip, guys - there is a whole world out there! Get off Kit's back! If you don't want to read something, skip it. And realize how fortunate we are to have Leasingnews. I subscribe to several newsletters from industries we actively lend/lease to, and not one of them has such an "inside scoop" like Leasingnews. Please continue to provide things that you think are of interest to us. Some of us appreciate it! Travis Foxx President <travisfoxx@merchantcapital.net Need financing for your growing business? Merchant Capital - "Financing for Entrepreneurs" http://www.merchantcapital.net ---------------------------------------------------------------------------- We encourage you to quote us ( you don't need or permission ) Send to a Colleague!!! go on line to our site www.leasingnews.org and press "send to a friend." ----------------------------------------------------------------------------------------
FICO Score by Archie Julian In yesterday's San Francisco Chronicle I read an article in the Real Estate section I would like to share with you. The article was written by Kenneth R. Harney and the headline reads "Your 'FICO' Score is No Longer A Secret." The following are excerpts from the article. Fair, Issaac and Co. - teamed live online with credit bureau Equifax to provide "FICO" scores and other personal credit information to consumers nationwide. It goes on to explain what a "FICO" score is. California mandated disclosure of credit scores to all borrowers who request them, beginning July 1. Federal legislation that would do the same thing nationwide is pending in both houses of Congress. This week's launch of what the two sponsoring companies call "ScorePower" service should eliminate the controversy of FICO score secrecy. For a $12.95 charge on a major credit card, anyone can now obtain not only an Equifax credit report online, but a current FICO score - accessible for 30 days - plus personalized guidance on the key reasons for the score. The service will also provide a graphic representation showing how you stack up against all other borrowers, and specific recommendations on what you can do to raise your score. To access your credit data, you'll have to pass through what Equifax Vice president J. Michael Cummins called an "interactive identity authentication process." The authentication program will ask a series of questions involving credit-file information- consumer loan balances, names of lenders, etc. - that only Equifax and the holder of the actual credit accounts would be able to answer. The authentication system is sophisticated enough to screen out someone in possession of another person's wallet, credit cards and Social Security number who is seeking illegal access to a credit file, according to Cummins. Although the new service is the first to offer the actual FICO score that lenders obtain and use in credit decisions, it is not the only online commercial source of credit scores. At least two others - www.qspace.com and www.worthknowing.com - offer other types of scores that analyze and quantify one's credit standing. For some consumers, the other Web sites can be confusing. For example, a Washington D.C., area homeowner recently obtained what she assumed was her credit score through the Qspace Web site, and was disturbed that her score was much lower than the credit score she had heard amount in a financing several years earlier. The Qspace score is not a FICO score- a disclosure only found in the fine print on the Web site. It is instead a generic score the an Qspace spokeswoman said can only emulat3e a real FICO The bottom line: At least for the time being, there's only one source for the real thing - the FICO score your mortgage lender actually uses to evaluate you. Anything else may be interesting and even educational. But it may not be relevant in the real world of mortgage lending. Archie Julian <JulianA@ExchangeBank.com> ---------------------------------------------------------------------------------------
Duit Software releases DUIT!Broker 3.0 and DUIT!Lessor 3.0 ########################################################## Enhanced SSL encryption features, more robust vendor integration, and entirely new architecture. Austin, TX (March 26, 2001) Duit Software (www.duitsoftware.com), the emerging leader in financing industry software solutions, announced the release of DUIT!Broker 3.0 and DUIT!Lessor 3.0 - Web-based financing software solutions, built from day-one for small and medium brokers, lessors, funding sources, and internal financing wings. Answering the calls for heightened security, more seamless vendor management and integration functions, and intuitive application database access, Duit Software met those challenges with what some industry insiders are calling an "unparalleled software solution" for small and medium financing companies. Due to the fiercely competitive climate, the occurrence of financing companies downsizing, re-evaluating their business model, and even closing their doors has become too familiar. Duit Software understood that small and medium financing companies need a competitive edge in order to survive. DUIT!Broker 3.0 and DUIT!Lessor 3.0 enable financing companies to increase the efficiency by which they operate. With this sophisticated software, the lease-quoting process is completely automated. Furthermore, the tedious, labor-intensive steps involved in the conventional paper-application completion process are avoided, reducing number of employees required to run the business. Simply put, DUIT! 3.0 enables companies to gain and follow up on more REAL leasing leads, and make more money. DUIT!Lessor 3.0 is designed for lessors and internal financing wings, looking to instantly increase the number of qualified lease applications, and streamline the quoting and application submission processes. Features include: A customizable online rate calculator - The rate calculator comes standard with four buyout tables and terms from 12 to 60 months, and a very intui tive administrative section for creating and updating rate variables. Secure, encrypted online application with automatic posting of customer's lease terms - Upon choosing the appropriate monthly payment, the customer is invited to complete the online application - either by submitting it online, or by printing and faxing it. The application is then securely routed to the lessor's encrypted database, with the customer's lease terms included (customer's information is NOT e-mailed). A unique, professional Web site - Duit Software will design the Web site with professionalism and productivity in mind. Additionally, DUIT!Lessor 3.0 has the ability to create a virtually unlimited number of additional pages. DUIT!Lessor 3.0 can also easily integrate with an existing Web site. Automated email notifications - Once the customer submits the application, the lessor and customer are sent separate emails, containing the application's unique numerical identifier, and customizable email text. Secure, encrypted searchable application database - The application database is secured with the latest in SSL encryption, and protected by login and password. Applications can be searched for by a variety of criteria: company name, contact name, telephone number, e-mail address, and application number. The applications are displayed in a printer-friendly format, for quick hard-copy archiving. Easy application customization - Adding, removing, and organizing application fields is a snap with DUIT!Lessor 3.0. Even customizing the release statement is easy, with simple text or custom HTML. Security and encryption at all points of data entry and data transferal - Data entry by customer and lessor - and data transferal by lessor - are all secured from end to end with SSL encryption, hard-coded password protection, or hard-encryption, for maximum security. Completely Web-based software - no software installation is necessary, as DUIT!Lessor requires only a dialup Internet connection and standard Web browser. DUIT!Broker 3.0 is designed for brokers and funding sources looking to bring in more business through their vendors, looking to integrate their host of services with their vendors, and looking to create a fluid, complete customer experience between vendor and broker. DUIT!Broker 3.0 includes all features of DUIT!Lessor 3.0 plus: Secure, encrypted online vendor enrollment - Vendors interested in taking advantage of broker's services apply online for enrollment in broker program. Online vendor enrollment is secured from end to end with encryption. Robust vendor management - Easily add, delete, or manage vendors. Dedicated, vendor-specific online rate calculator - Each vendor is given their own dedicated online rate calculator, with their own unique set of variables, customized and maintained by the broker, standard with four buyout tables. Dedicated, vendor-specific online application - Each vendor is given their own dedicated online lease application, with their own unique set of questions and requirements, customized by the broker, secured with encryption. Customizable look-and-feel - The broker can easily customize the style of the vendors' application-, calculator-, and submission acknowledgement-pages, to emulate the look of each vendor's existing Web site, creating a fluid, complete customer experience - hands-off for vendors, empowering for brokers, and transparent to customers. Secure, encrypted online application with automatic posting of customer's lease terms - Upon choosing the appropriate monthly payment, the customer is invited to complete the vendor's online application - either by submitting it online, or by printing and faxing it. The application is then securely routed to the lessor's encrypted database, with the customer's lease terms included (customer's information is NOT e-mailed). Automated e-mail notifications - Once the customer submits a vendor's lease application, the customer, broker, and vendor are sent separate e-mails, with the application's unique numerical identifier. Additionally, the broker is notified with the name of the vendor, through which the customer applied. Secure, encrypted searchable vendor lease application database - The vendor lease application features all the same powerful encryption and database search features found in DUIT!Lessor 3.0. Security and encryption at all points of data entry and data transferal - Data entry by customer, broker, and vendor - and data transferal by broker - are all secured from end to end with SSL encryption, hard-coded password protection, or hard-encryption, for maximum security. Completely Web-based software - no software installation is necessary, as DUIT!Broker requires only a dialup Internet connection and standard Web browser. Encryption is a requirement, NOT an option. Alarmingly, currently the industry standard for lessors, brokers, and internal financing wings is to offer an 'online lease application' that does nothing more than accept the customer's sensitive financial information, and send it to the agent by e-mail. The e-mail channel is NOT secured. Actually, it is quite easy for identity thieves to intercept emails anonymously. Additionally, most online financing software packages in the market today store the customers' applications in static text files. A hacker, with simple tools available (and often free) on the Internet can and will infiltrate a network and gain access to these files. Recent hacks into some of the most popular e-commerce sites have shown this to be a problem. Just yesterday, USA Today featured an article about a hacker who had allegedly stolen Social Security numbers, home addresses and birth dates of 217 of the 400 wealthiest Americans (link to article below), simply because the proper security precautions were not exercised. DUIT!Lessor 3.0 and DUIT!Broker 3.0 are one of the most secure online financing solutions available. Instead of e-mailing the sensitive financial information, DUIT!Lessor 3.0 and DUIT!Broker 3.0 e-mails the broker, customer, and vendor a brief message, containing only the application's unique numerical identifier. The customer's application information is stored in the encrypted, password-protected application database - accessible only by the financing representative, and NEVER leaves the secure environment. To add maximum security for the sensitive financial data, the information is never stored in static text files, but as dynamic, encrypted, printable image files - making them impossible to locate, without the appropriate administrative clearance. Finally, DUIT! 3.0 is locked-down in a secured database, encrypted from end to end, protecting any information that is transferred from the Web server to the application/database server. At no point in the data-entry and data-transferal process is the application information ever converted to a static text file. In light of recent identity fraud cases, whereby criminals gain access to bank and credit card accounts with information contained in documents such as lease applications, the demand for increased security is undeniable. The Internet is a powerful tool, however, any financing company that does not take the proper precautions, when offering online financing services, are running the risk of vulnerability to identity theft, lawsuits by injured parties, costly attorney fees, and loss of revenue, credibility, and customers. Duit Software has taken great pains to develop a fully secure online financing environment in order to enable financing companies to take full advantage of the power and accessibility of the Internet, and shielding them from any vulnerabilities and security issues. DUIT!Lessor 3.0 and DUIT!Broker 3.0 are fully database driven using MySQL, and built with integration in mind. DUIT!Lessor 3.0 and DUIT!Broker 3.0 can easily integrate with most proprietary and commercially available contact-management, credit reporting, and application processing systems, providing a seamless financing sales process. DUIT!Lessor 3.0 and DUIT!Broker 3.0 are now available with free upgrades and technical support. Tailored support and hosting plans are also available. Call a Duit Software representative today to secure your competitive edge. 800.880.7555 sales@duitsoftware.com Online DUIT! 3.0 Demos: http://www.duitsoftware.com/demos.html Hacker Uses Forbes List To Steal http://www.usatoday.com/usatonline/20010321/3159485s.htm #################################################### ----------------------------------------------------------------------------- Opportunity for Leasing Companies to Grow---- Banks Tighten Up on Business Loans as the Economy Softens By DEBORA VRANA, Los Angeles Times Staff Writer For Chris Lewis, it was a standard request for the kind of deals he has been putting together for more than a decade: a $50-million bank loan to buy a Southern California manufacturing company. Lewis never expected he'd run into so many closed doors. "We didn't think we'd have a problem, but we weren't able to put the deal together in this economy," said Lewis, a partner with Riordan, Lewis & Haden, one of Southern California's leading private investment firms. "The banks have just become more cautious." As the economy has slowed, more investors and businesses in Southern California and nationwide are finding banks suddenly less eager to lend than in recent years. But talk of a credit crunch--a severe cutback in bank lending that affects business borrowers across the board--is overstated, many experts say. Bigger banks have become more cautious than smaller institutions, some analysts say, and the hefty borrowing requests typical of major companies and of investors seeking to make large deals--like the one Lewis sought--are being evaluated more critically by lenders. "I think the economic slump forced the banks to tighten standards," said Peggy Bradshaw, executive vice president of the small business division for Comerica Bank-California. "And when you see the standards tightening, it impacts the larger companies and their credit needs first." However, bank credit still is readily available for smaller, stable firms with strong balance sheets and good business prospects, many experts say. Government-guaranteed lending, through the Small Business Administration, also is available. What's more, bank credit in general is getting cheaper because of the Federal Reserve's interest rate cuts. With last week's half-point Fed cut, the bank prime lending rate fell to 8%. It was 9.5% at year's end. "There's no real problem at the moment," said Bill Dunkelberg, chief economist for the National Federation for Independent Businesses, a trade group representing small businesses. "The hurdle may be higher [in terms of tightening loan standards], but we're getting over it. There may be more care in lending by bigger banks, but that hasn't trickled down to banks lending to Main Street America yet." A Federal Reserve survey released in January showed that nearly 60% of U.S.-based banks tightened standards for commercial and industrial loans to large and mid-market businesses, blaming a weaker economic outlook and reduced tolerance for risk. But just 45% of banks tightened lending standards to small firms. Dunkelberg pointed to a monthly survey his trade group does of 600 members that found only 4% were having trouble getting credit in February. That compares with the late 1980s, when credit was the No. 2 problem for businesses after inflation. "We haven't seen a credit crunch yet," he said. The stakes are particularly high in California, home to a large number of small and mid-size firms that depend heavily on bank loans. With venture capital investments slowing sharply,
the "junk" bond market
closed to many higher-risk borrowers,
and the market for Bruce Ackerman, president of the Economic Alliance of the San Fernando Valley, said, "We are still seeing growth, and, if anything, the money is still out there."
But some industry experts
say they're hearing more concern
from companies. president
of the Software Council of Southern
California, a trade group that
represents of bank loans. The shakeout in the tech sector has bankers concerned. Bradshaw, who works in the Silicon Valley, said Comerica is closely following the dot-com shakeout and its fallout.
"If we hear in the
valley that XYZ company is going
to cut back and we know that
one they can remedy the situation," she said.
At Bank of America, spokeswoman
Betty Riess said lenders are
watching for borrower "We've got money to lend," she said. "We continue to monitor the impact of the energy situation on our business customers, but so far we haven't seen anything notable." Still, some new data are troubling. Banks nationwide are seeing increasing problems in their commercial-loan portfolios, the Federal Deposit Insurance Corp. said last week. For now, however, many banks' response to rising loan problems is simply to limit their exposure to major new loans. Equity investor Lewis says he will wait until later this year to try the banks again for his $50-million loan, on hopes the economy will improve. "We're hopeful," he said. "Right now, we're sitting tight." ------------------------------------------------------------------------------------------- We get about two stock brokers soliciting business every day. The increased telemarketing is driving us nuts. We are also getting two to three calls from companies who want our off lease equipment. They are salvage hunters, as the used equipment market is growing, and the solicitors believe leasing companies are getting a lot of equipment back. One of the reasons, may be all the stories like this that are appearing in the newspapers. Monday, March 26, 2001 Dead dot-com scrap heap floods market BRIAN BERGSTEIN THE ASSOCIATED PRESS CAMPBELL,
Calif. -- CDworld.com folded
this month after six years in
business. workers have been fired, and the small offices in a strip mall are nearly bare. But the music, video and games online retailer is still hoping to unload some valuable merchandise -- namely, the nuts and bolts of the Web site itself: a Cisco Systems device that directs Internet traffic, a refrigerator-sized server by Sun Microsystems and smaller ones from Sun, Hewlett-Packard, IBM and Compaq.
"I'm sure we will
sell it," said Annette
Martin, who ran CDworld.com
with her husband, It happens that Martin also is a psychic adviser who has appeared on television, but it doesn't take a sixth sense to know that the used pieces of her Web site will find buyers.
Like ants swarming over
a summer picnic, obscure equipment
resellers all over the are
reaching out for the wealth
of inventory becoming available
from dismantled dot-coms. equipment-leasing company looking for a good deal. "There's a lot of used equipment on the market right now," said Ben Nelson, who handles online sales for UsedRouter.com, a 17-employee company in Las Lunas, N.M. He said the slowing economy has "encouraged companies to go out and search for used equipment." The dot-com meltdown ripples through the rest of the high-tech economy. Hardware companies are moaning that demand for everything from personal computers to telecommunication equipment has all but vanished, and the availability of tons of inexpensive used equipment makes it that much harder to dig out. Secondhand equipment generally doesn't appeal to large businesses that want custom-built networks, service contracts and warranties. But smaller companies or service providers with technical
know-how can do well digging
into the scrap heap. This isn't
like buying a used car tear. Gary Sapp, president and CEO of Tangent Communications Inc., an electronic equipment reseller in Des Plaines, Ill., says a quarter of his inventory comes from dead dot-coms that defaulted
on equipment leases or declared
bankruptcy. The rest comes mostly
from large Not surprisingly, economic conditions are lowering prices. For example, one Cisco router -- which directs traffic on a network -- that a year ago cost between $3,500 and $4,000 on the secondary market today goes for $2,500 to $3,000. New, it sold for $10,200. "It's definitely increasing the ability to buy inventory," Sapp said. "We had some holes in our inventory -- we filled those." Tangent isn't immune to the high-tech demand slowdown, but Sapp believes that when the economy revives, he will be waiting with some very good deals. Another Cisco router that sold new for $2,495 can be had used from Tangent's site for $595. "It's just a matter of time before there will be demand, and there probably will be pent-up demand," Sapp said. "It could pay dividends nine to 12 months from now." At Excess Solutions, a seven-employee electronic parts broker working out of a ramshackle white
building in a San Jose industrial
zone, owner Mike Giordano is
buying up as much as The strategy isn't guaranteed to work, especially if manufacturers come out with significantly better products by the time the economy turns around. "I'm afraid when the market does turn back, the technology will be so far past what's sitting on the shelf," he said.
Cisco spokesman Tom Galvin
said dot-coms have accounted
for only a fraction of sales,
to Cisco," he said. Cisco will likely be safe because most of its sales are to high-end network infrastructure providers,
agreed Seth Spalding, an analyst
at Epoch Partners. Companies
that sell "It will eat up some of the revenue base," Spalding said. "It's part of anticipated demand that's just not going to be there." When asked about the resale market last week, 3Com chief executive Bruce Claflin did not address the subject directly, though he acknowledged that the dot-com collapse and overall high-tech slowdown are causing serious inventory problems. "I think what we have in the industry is overhype that led to over-investment that led to overcapacity ... too many people building too many things chasing a diminishing demand," he said. "I do think the industry has to work through these problems, and I believe we are not at bottom yet." Kasey Holman, a spokesman for Sun -- which boasts it is the "dot in dot-com" -- said the company's servers "have always enjoyed a rich aftermarket." But she wouldn't say whether the secondhand world is posing a tougher challenge now. She noted that Sun's revenue grew 60 percent and 44 percent in the past two quarters, and since the economy has slowed, Sun and its sales-channel partners are "working to get inventory levels back down to normal." She would not provide exact figures. Even so, real problems could arise if the resale inventory helps keep some big high-tech companies from raising prices, said Paul Sagawa, an analyst at Sanford Bernstein and Co. "I think it's something for them to worry about," he said. "It might not be something that's affecting them now, but it may be something that could make the recovery more difficult to accomplish." --------------------------------------------------------------------------------------------- ############################################################## Willis
Lease Finance Sets Quarterly
Record With $88 Million in Additions
to Lease
SAUSALITO, Calif.--(BUSINESS WIRE)--March 26, 2001-- Raised $47 Million From New Equity and Sales of Businesses Willis
Lease Finance Corporation (Nasdaq:WLFC)
and its affiliates today reported
The
company generated a 23% increase
in its lease portfolio from
continuing In
November of 2000, WLFC signed
an alliance with SAirGroup,
parent of Net
earnings from continuing operations
were $5.5 million or $0.72 per
diluted Alliance with SAirGroup The
most significant event for WLFC
in 2000 was the alliance with
SAirGroup. -- $18.2 million (net of transaction expenses) of equity capital was raised through the private placement of new shares and options with SAirGroup subsidiaries, Flightlease AG and SR Technics Group. -- WLFC sold its interests in its spare parts and repair businesses at a combined after-tax gain of $2.1 million. The sale generated net proceeds of approximately $29.2 million of cash, after repayment of related debt and payment of transaction expenses. -- WLFC purchased five engines for over $43 million in a purchase and leaseback transaction with SR Technics Group. This was the largest engine lease transaction in WLFC's history. "This
alliance is a milestone for
our business and enhances our
position in "The
sale of our spare parts and
repair businesses simplifies
our business model," Solid Balance Sheet At
December 31, 2000, WLFC had
100 commercial jet engines,
4 aircraft parts The
company's funded debt to equity
ratio was 3.2 to 1 at year-end
compared ############################################################## ---------------------------------------------------------------------------------------------- He advised clients to start selling last Fall ( many did ) and has been touting the bond market earlier than everyone else. Read why in this press release: ############################################################## Stock Market 'Fall' Is Over ... Or Is It? The Shepherd Investment Strategist Answers
SPOKANE, Wash.--(BUSINESS
WIRE)--March 26, 2001--When
James A.
If you listen to the
financial media, Wall Street's
analysts are again
"Not so," says
Shepherd. "Although that
is indeed one sign that a turn
He explains why it is
going to be different now and
explains some
He states that Wall Street
has spent billions since the
end of the last
He reminds us that following
the 1929 crash, investors that
didn't
Recent pieces in The
New York Times and 60 Minutes
II, confirmed
Shepherd's Model issues
clear buy, sell, caution, warning
and advisory
Shepherd and his subscribers
are now waiting for the Model
to ########################################################### www.sex.com ( Okay, why is this in LeasingNews.org? I thought "sex" sells, and the story reminds me of all the weird things I have been hearing about the large leasing companies going out of business and now many are seeing that the Emperor is not wearing any clothes in the dot.com business. These are wild times!!! And you don't have to read this, if you are not interested in www.sex.com. editor ) Stephen Cohen, one of the Internet's most successful entrepreneurs, made his fortune by stealing the Sex.com site. By JOSEPH MENN, Los Angeles Times Staff Writer
SAN FRANCISCO--Stephen
Michael Cohen is one of the
most successful Internet
Age, having raked in an estimated
$43 million in profit from monthly memberships sold through the pornography site http://www.sex.com.
What makes the feat more
impressive is that Cohen, a
multiple felon who swingers'
sex parties in Orange County,
made his money by swiping the
letter to the agency that registers Internet names.
Within days, U.S. District
Judge James Ware in San Jose
is expected to disgorge
all his earnings from Sex.com.
This month, Ware ordered Cohen
Neither of those rulings
are likely to faze Cohen--who
lives in a Tijuana and
his millions, which are stashed
in offshore bank accounts, are
out justice system. Cohen set up Sex.com as a sex supermarket, advertising referrals to nude pictures of celebrities, teenage sex videos and other hard-core porn offerings. The site became so popular that Cohen grossed hundreds of millions in sales in five years, according to court records.
Cohen's stint running
Sex.com ended in November, when
Ware returned the Web address
to "I expect to get my hands on nothing," Kremen said of his long legal battle. "This isn't about business anymore. It's the principle." The tale, which includes a bizarre multibillion-dollar takeover bid for Caesars Palace and a heist of records from a Kinko's store, stems from the Web's Wild West atmosphere and the fact that sex is a great business on the Internet. Kremen has met Cohen only once, in San Diego when they discussed a possible legal settlement last year. Over steaks and wine, Kremen found a lot to like in the now-fugitive.
"Cohen is a brilliant
businessman," Kremen said.
"He's so convincing that,
after 20 minutes of Both men were quick to see the Internet's potential as an anonymous meeting place for people seeking romance and sex. For two decades Cohen had various business endeavors, with occasional run-ins with the law. Cohen's convictions include a 1977 suspended sentence for forgery, grand theft and impersonation. In the 1980s, Cohen ran sex-related computer bulletin boards under the name the French Connection. But he won local notoriety for throwing sex parties for fee-paying swingers in a tony Tustin neighborhood. After residents complained, Orange County authorities went undercover to investigate and prosecuted Cohen for misdemeanor zoning violations. The 1990 case ended in a mistrial when authorities failed to prove Cohen was running a business instead of, as he claimed, a nonprofit club just covering expenses. Two years later Cohen engineered a scheme to hide assets of an acquaintance who filed for bankruptcy, and he lied to a judge by claiming to be a lawyer handling the associate's case. Cohen was convicted of forgery and fraud and sentenced to 46 months in federal prison. "Might he have character flaws? Sure," Cohen's attorney Robert Dorband said of his client. "But I don't think he's got an evil bone in his body." Cohen didn't respond to requests for an interview. Cohen Took Control of Site in 1995 When Cohen emerged from the penitentiary at Lompoc in 1995, the Internet was gathering steam. He inquired about the status of Sex.com and found it registered to Kremen's firm, Online Classifieds Inc. According to Cohen's testimony, he drafted a letter on fake Online Classifieds stationery, stating that Kremen had been fired from that firm and transferring ownership of the domain name to him. Then, Cohen said, he and a friend drove to the residence where they believed Sharyn Dimmick, a former housemate of Kremen's, lived. Cohen's friend returned with the letter signed by a "Sharon Dimmick" on behalf of Online Classifieds. Among the problems with Cohen's story: Dimmick's first name is misspelled on the document as
Sharon; she was not an employee
of Kremen's company; and she
no longer lived at that address.
Nevertheless, Cohen sent the letter to Network Solutions Inc., which registers Internet addresses, which turned over control of the Sex.com site to him in October 1995.
As for Kremen, he had
an early interest in computers.
He earned a Stanford business
His biggest hit was a system for online classified advertising that became the popular Internet dating service Match.com. In 1994, a year before online bookseller Amazon.com opened, Kremen registered several Internet domain names, including Sex.com. Back then registrations were freely doled out under a National Science Foundation program.
"I wasn't exactly
sure what I was going to do
with it," said Kremen,
37, who now works at a But Kremen let Sex.com languish before Cohen seized the name and set up a business. When Kremen contacted Network Solutions, the firm threw up its hands and told Kremen to try his luck in court. In 1998 Kremen scraped together enough money to sue Cohen. But only after other companies that Kremen invested in began to pay off was he able to turn up the heat with higher-priced lawyers. By then, Cohen was flush with millions from Sex.com, and he was able to fight back with a vengeance. Cohen filed a defamation suit against Kremen, stalled requests for documents and moved his money to companies in Mexico and the British Virgin Islands, according to records in the 20-volume court case. "As soon as we get to a bank account, it's moved offshore," Kremen's attorney Pam Urueta said. "It's like trying to nail a jellyfish to a wall." Cohen's boldest stunt may have come in October, after bank records were delivered to a Kinko's store for copying and mailing to Kremen's lawyers.
According to Chula Vista
police, someone matching Cohen's
description walked in, said This month, Ware ruled that Cohen, who failed to post a $25-million bond, had a "demonstrated history of transferring assets and evading the authority of this court." How much money Sex.com has generated is one of the few issues left for the judge to resolve. Roles of Cohen, Kremen Reversed Cohen's Virgin Islands-based Ocean Fund International once announced that Sex.com had a profit of $95.5 million in a single quarter. And another news release by Cohen's firm proclaimed that the owner of the "world's largest pornographic site" was making a $3.6-billion, all-cash offer for eight Caesars Palace casinos. Wall Street dismissed the offer as laughable. Kremen said he believes Cohen's testimony that he turned down $48 million for Sex.com, a sum that would dwarf the record $7.5 million paid in 1999 for the domain name http://www.business.com.
Kremen's experts, using partial
records, put Sex.com's five-year
profit Cohen's attorney Dorband conceded that he will lose the current case but promised to appeal. In the meantime, the roles of Kremen and Cohen have reversed. Cohen, the longtime pornographer, says he is working on building a fiber-optic Internet hub in Tijuana. And engineer Kremen is enjoying the financial rewards of Sex.com, as the hard-core porn site brings in $400,000 monthly from advertising. "It is what it is," shrugs Kremen, noting that a large percentage of Web profits derive from adult entertainment. "Porn is the savior of the Net. It's the crazy granny in the closet that no one talks about." |
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