Jonathan Seidenberg thinks I'm a jerk. But really, I'm not.

Jesse James, the guy who cheated on Sandra Bullock - now, that's a jerk. K-Rod, the relief pitcher for the Mets who beat up his girlfriend's dad and has to miss the rest of the season because he injured himself in the process? Jerk. The guy in Buffalo who was found "marinating" a cat in the trunk of his car? That's a real jerk.

So even though Jonathan Seidenberg thinks I'm a jerk, I'm really not. I'm an idiot, not a jerk.

Jonathan calls himself the chief financial officer of a small manufacturer and we, for a time, were doing business together. His firm made use of software that we had sold him years before. And now Jonathan hired us to do a big project. which was to be done in phases. The first phase was a project plan. Based on the results of that first phase, Jonathan would then engage us to implement the other phases. Pretty cool, eh? A nice fat project in the middle of a slow economy with ol' Jonathan will fatten up our bank account, I thought to myself at the time.

Unfortunately, we ran into problems. Not with the first phase. It was getting paid for the first phase. It never happened.

Why? Because I'm an idiot.

It's not that we didn't try to get paid. My bookkeeper called, e-mailed and faxed Jonathan and his accounts payable person about our overdue invoice. No response. So, unfortunately, I had to get involved. Jonathan and I had a few testy phone conversations where he promised payment once he got "financing." Unfortunately, we had never discussed "financing" ever before, even when the project initially got started. He promised not only the payment of my open invoice but future riches for me and my firm with the next, oncoming phases. But still weeks went by and no payment was made.

Could it be that Jonathan was ... gasp ... lying to me?

I'm sure you've figured out what happened next. The you-know-what hit the fan one Friday morning when someone from his office called my service desk and asked for software help. I put the brakes on and declined any service until our open invoices were resolved. Word quickly got back to Jonathan. And then Jonathan called me from his cell phone, leaving a string of naughty words on my voicemail. I called him back. We yelled at each other. I told him to pay his bills. He called me a jerk.

I'm not a jerk. Just an idiot.



I'm an idiot because I let the situation get to this place. C'mon - I've been a penny-pinching business owner for more than 15 years. I write about this stuff. I've been slimed by guys like Jonathan in the past. Haven't I learned? Couldn't I have avoided this mess? Smart penny-pinchers know that the secret to good collections is doing the work up front.

I didn't do this.

Why? Because I'm an idiot.

For example, I never checked Jonathan's credit situation. I've known the guy for a few years. But I ignored the red flags. His flashy suit and expensive car. The pinky ring. The fact that he insisted on being called chief financial officer of a company that could barely employ a bookkeeper. The dilapidated building his company occupied. The bad economy. The recent layoff of office staff. I knew about all of these things. They were red flags. And yet I still plowed ahead with the project. I never checked his company's credit reports. I never asked for credit references. Why? I was too busy. I was too excited by the job. I was an idiot. So we just moved forward on good faith because he seemed nice (at the time) and the project was potentially significant.

I should've got some money up front, too. But I didn't. Why? Because I'm an idiot. The initial project we did for Jonathan was only $6,000. By asking for at least half up front, or even a third, I would've had some cash in the bank to cover my costs in case things went south. And I'm pretty sure that I could've gotten him to pay that, too. It would've eased the pain a lot. But I didn't do that either. Why? Because I'm an idiot.

I should've gotten his credit card. That's always worked pretty well in the past. That way we could've agreed on smaller payments with his credit card, which would've helped with cash flow. Sure I would've had to cough up some fees, but it would've been worth it to get cash in the door. Having his credit card number would've also allowed us to immediately get the money, instead of waiting for his office to write the check for him to sign and send out. Knowing Jonathan's antics, a delay in this process, even after he promises payment, was likely. Having a customer's credit card on file is good insurance. But I didn't do that either. Because I'm an idiot.



I'm an idiot because I was chasing future riches and ignoring present cash flow. Jonathan pulled an ancient but excellent tactic that slimy guys use when they don't pay their bills: They hold out a carrot. They promise a bigger thing coming up. They ask for patience and extra time to pay and use "the bigger thing" as an enticement to cloud the thoughts of the guy waiting for payment. That was me. The idiot. I kept thinking to myself "Oh, I better not get too tough about that open invoice because it may jeopardize 'the bigger thing' that Jonathan keeps promising."

But here's the thing: There is no bigger thing. And even if there was, do I really want to do another project with a guy who's clearly not credible? He wears a pinky ring, for God's sake! Doesn't history repeat itself? Doesn't the criminal always return to the scene of the crime? Do I really think that Jonathan wouldn't pull the same old tricks in that next "big" project? Some things just aren't worth it. Even to an idiot like me.

So in the end, I stopped being an idiot. Instead, I acted, in Jonathan's words, "like a jerk." But I'm not being jerky. Just a good penny-pincher. I hit my limit. I couldn't continue to provide him with free services. I couldn't afford to work with the guy and not get paid. Not only was it hurting me financially but it was affecting me emotionally. For $6,000 I was almost willing to commit a homicide. I can't imagine many people on this earth would even miss Jonathan. And I'm also sure most penny-pinchers would agree that it's justifiable homicide, too. But try convincing a jury of that.

So I had to break it off. I cut my losses. I told him to pay his bills. He called me a jerk. I moved on. Let him work with, and not pay, one of my competitors.

Do I send this invoice to a collection attorney? Of course! We have a good one in Florida. (They're all based in Florida, it seems.) Our collection attorneys are particularly expert at sending nasty letters to guys like Jonathan. And we've got a signed contract to waive in his face to boot. No, I don't like giving up 30 percent of the bill. But the thought of ol' Jonathan being harassed and inconvenienced by my hired sharks? Love it!

CPAs, business owners, managers - please don't be an idiot like me. And don't be a jerk either. Please - take some simple steps to protect yourself before entering into that next big deal. That way you can avoid the collection problems I had. Even with jerks like Jonathan.


Gene Marks, CPA, is the owner of the Marks Group, which sells customer relationship, service, and financial management tools to small and midsized businesses.

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