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Risk Management Blog

UCC & Corporate Due Diligence

Resource Guide for Legal and Financial Professionals

Does a lender need to file a precautionary UCC filing against the lessee of the equipment to perfect the lender’s security interest in the leased equipment?

UCC, Revised Article 9, Reduce Financial Risk Something

Do you have UCC questions about equipment leases?  Are you at risk to losing priority to other creditors? Attorney Bennett Cohen of Illinois law firm Cohen, Salk & Huvard, P.C., gets asked questions like this all the time, and has taken the time to write some answers. You may also want to check out his eBook on Purchase Money Security Interests (PMSI). Precautionary UCC Filings against Lessees of Equipment: Does a lender need… >> READ MORE


Does a lender need to take possession of the original leases to perfect its security interest in the equipment leases?

UCC, Revised Article 9, Reduce Financial Risk Something

Do you have UCC questions about equipment leases?  Are you at risk to losing priority to other creditors? Attorney Bennett Cohen of Illinois law firm Cohen, Salk & Huvard, P.C., gets asked questions like this all the time, and has taken the time to write some answers. You may also want to check out his eBook on Purchase Money Security Interests (PMSI). Pledges of Equipment Leases: Does a lender need to take possession of the… >> READ MORE


Single Extra Space Creates Seriously Misleading UCC Debtor Naming Error

UCC, Online UCC System, Due Diligence, Revised Article 9, Reduce Financial Risk, Tips Something

A recent court ruling in Wisconsin once again has affirmed the supreme importance secured parties must place on their data entry procedures when naming debtors on financing statements to perfect their security interests. A recap of the case can be found here. Once again, a typo in the debtor name created a UCC filing that was judged to be seriously misleading, and therefore left the secured party’s security interest with the debtor… >> READ MORE


UCC Secured Party Representative Service – Explained

UCC, Online UCC System, Revised Article 9 Something

UCC Secured Party Representative Service provides protection for secured lenders by using a representative’s name (instead of their own) in the Secured Party box on UCC Financing Statements. Under Revised Article 9, UCC Section 9-502(a)(2), a financing statement must provide the name of the secured party or representative of the secured party. The Secured Party Representative Service key aspect is that the code allows “a representative”… >> READ MORE


Upcoming Changes to Revised UCC Article 9

UCC, Due Diligence, Revised Article 9 Something

As many of you are probably aware, state filing offices are in the process of reviewing and approving a set of proposed amendments to Revised Article 9 (RA9) of the Uniform Commercial Code. The proposed changes are designed to bring about increased consistency between filing offices and to offer answers to some questions that have been raised in the courts since RA9’s adoption back in 2001. As we have discussed on this blog on several… >> READ MORE


Drawbacks of a Certified UCC Search – FCS Greatest Hits #6

UCC, Online UCC System, Due Diligence, Revised Article 9 Something

The final installment in our Greatest Hits blog series covers state certified UCC searches, aka UCC11s. There are times when you might want to request a certified search, they do serve a purpose. But, because of their oftentimes narrow search logics which can inhibit a searchers ability to uncover name variations, thorough due diligence typically requires utilizing a broad-based search solution that is designed to uncover and include… >> READ MORE


Top 5 Misconceptions About UCC & Corporate Due Diligence Series # 3: Include Similar Names in Searches to Locate Tax Liens and Mis-Indexed Filings

UCC, Due Diligence, Revised Article 9 Something

According to Revised Article 9 of the Uniform Commercial Code, a UCC Financing Statement is only effective if it gets the debtor name right. A UCC filing that fails to properly identify the debtor by their exact legal name will not offer the secured party priority status to collect should the debtor default or file for bankruptcy. Searchers often mistakenly interpret this to mean they only need be concerned with filings that provide an exact… >> READ MORE


Three Phases of Due Diligence Series – Phase One: Pre-Funding

UCC, Corporate, Due Diligence, Revised Article 9 Something

In the pre-funding phase, lenders perform public records searches to uncover any existing liens or outstanding financial obligations that bind their prospect. Searching helps lenders determine if they could obtain a priority position to collect if they decide to fund the deal. Companies who require additional intelligence and insight in corporate due diligence may wish to hire investigators to assist with the process. Focusing on the… >> READ MORE


What is a Secured Transaction? Understanding Article 9 of the Uniform Commercial Code

UCC, Revised Article 9 Something

As promised, this week’s blog post will delve a little deeper into the Uniform Commercial Code (UCC) through a discussion of Article 9: Secured Transactions. According to the Law Library,  Secured Transactions are, “Business dealings that grant a creditor a right in property owned or held by a debtor to assure the payment of a debt or the performance of some obligation.” In a little more detail, a Secured Transaction is financial… >> READ MORE


Need Some Help in Figuring Out Where to Conduct UCC and Lien Searches?

UCC, Revised Article 9, Tips Something

When searching for liens as part of a prefunding search package, it is important to know where liens could be filed. The last thing any lender wants is a surprise lien! In order to be certain you’re getting the results you think you are; searches must be performed for the right records at the appropriate filing office. Here are some tips to help determine where to search: 1. Revised Article 9 sets forth that UCC Financing… >> READ MORE