It’s time to set the record straight on poaching. It’s a difficult topic to broach because nobody wants to criticize something that gets annuitants more money.  I have always advocated for annuitants; however, increased payouts need to come from ethical and sustainable business practices.  Poaching is neither.   If you’re not familiar with the term, poaching is the search of court records to steal a competitor’s pending factoring transaction.  It doesn’t matter if they take over the transaction entirely or simply act as a “negotiator”, it’s still the theft of a competitor’s work product.

Poachers spin the narrative that their actions are justified because they find and fix egregious transactions.  I’d be inclined to agree if that’s all they did; however, the reality these days is there are far fewer truly predatory deals than poachers want you to believe.  What these poachers and their advocates aren’t telling you is that they usually just prey upon the everyday marketing and staffing costs of the originating factoring company; expenses they don’t undertake. 
The “cash now” business model requires extensive advertising to annuitants directly through TV ads, SEO, social media marketing and Google Ads.  They’re all expensive.  Add to that the cost of the telemarketing staff required to field all the inquiries, few of which go anywhere.  The cumulative cost to simply get one case onto a court docket is considerable.  That’s when poachers pounce.  They have this entire investment handed to them for free with an online legal database, and with no costs to recover, poachers can easily offer annuitants more money and still make solid profits.  They’re not Robin Hoods; they’re just parasites gaming the system under the guise of altruism.

You don’t need an Ivy League MBA to realize that poaching can’t last.  Ultimately, somebody must invest the funds to get a case to where poachers can steal it, and with every stolen file driving up the originating company’s costs, it becomes a vicious circle that’s not sustainable.  The entire factoring industry will go into a tailspin if poaching continues unabated.  Unfortunately, the last ones standing will be these parasitic poachers; something you absolutely don’t want for your clients.  They are truly the bottom feeders of an industry where the ethics bar isn’t set too high to start with.