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Single Extra Space Creates Seriously Misleading UCC Debtor Naming Error

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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 unperfected.

In this instance, it was the inclusion of a single extra space, “Inc .” instead of “Inc.” specifically. This seemingly enough innocuous error led to the filing to be judged seriously misleading and cost the secured party dearly.

But what can be done to mitigate and aim to eliminate debtor naming errors like this?

  1. Employ a professional UCC service provider that includes a web-based UCC portfolio management system.
  2. Implement an API for UCC filings with a service company that specializes in UCC compliance. This solution captures the debtor information from within your loan software and no re-keying or manual data transferring is required to populate the debtor field of your UCCs, thus eliminating those potential re-keying errors, like in the case discussed above.
  3. Request a Search to Reflect on your filing that utilizes the filing state’s standard search logic to find your filing; the code is clear on this criteria regarding verification of perfection.
  4. Diligently review all debtor names on your UCCs before final filing submission.

Contact us today and discuss our JSON RESTful API for UCC with one of our experts. We offer a complete JSON RESTful API for public records transactions including:

  • UCC Search
  • Business Search
  • UCC Filing
  • Monitoring of Debtors
  • UCC/Lien activity and Business Entity changes
  • Monitoring activity in US District Court, State Court, Bankruptcy Court records


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