Secured Party Searches and Secured Party Representatives—Cause And EffectMarch 16, 2017 UCC, Reduce Financial Risk
In our last two blog posts, we discussed what a secured party search is and how it is utilized to expose a secured party’s customer list, and also what a secured party can do to protect that customer list.
Lenders rely on security interests to manage their risk and perfect their security interests by filing UCCs, but this process puts their client list in the public record; every debtor on a UCC is that secured party’s customer! With every UCC financing statement filed, lenders expose their client list to their competitors.
What some lenders do is target certain competitors with secured party searches looking to discover who that secured party’s debtors are, their customers, so they can market to them.
If this is happening to your firm, perhaps it’s time to consider a Secured Party Representative Service. This service allows secured parties to perfect their security interests as before BUT with one important difference: the secured party’s name is no longer listed on the financing statement. So, when a competitor runs a secured party search on your firm’s name, your customer list is protected.
Secured Party Representative Services are a relatively new solution, derived directly from the need for secured parties to continue to perfect their security interests with UCC filings while not exposing their customer list to their competitors.
Interested to learn more? Click here to schedule a consultation with one of our UCC experts to learn more about how Secured Party Representative Service may be the answer to keeping your customer list confidential.