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Jim: “Hi Christine!”

Christine: “Khm, excuse me, hi!”

Jim: “One, two, three, hi Christine!”

Christine: “Hi Jim! How are you?”

Jim: “I’m wonderful, thank you! It’s good to be here and have some fun and as we do these impromptu videos, we’re getting comfortable doing them, and I’m actually enjoying it a lot more, I don’t know about you.” 

Christine: “Oh, I am too, I am too.”

Jim: “They’re starting to get fun. So this time we’re gonna talk about recoveries. So, by a brief introduction, we have been doing complex litigation cost administration for over 25 years.”

Christine: “Yes”

Jim: “And, when we were originally hired it was actually a recovery process, all the money was spent and someone hired us to go after the recalcitrant carriers who didn’t pay their share in the litigation case. But then as time evolved we began doing on-time administration because the people were beginning to pay as the expenses were incurred, so, so it became a completely different process for us. But now here we are 25 years later and I understand you got a new recovery file, can you tell me about that? “

Christine: “ I did, I did, and I guess we’re making a full circle, we’re back to the recovery files. So what does that mean? An audit-recovery file means that the case has been litigated but there’s a lot of money still left on the table. There are trades/carriers that still owe to the defense itself. Now, in this process, we, as the case has been ongoing, at some point, there may have been not a lot of tracking throughout the file so those folks have, may have, not have the correct information of payments that were already issued, where did those payments go to, invoices that may have been missing. So a lot of their audit-recovery files fall into the reconciliation or I guess you could say the “forensic accounting” portion of how we’re going to get this, these funds back to that client?”

Jim: “ Well that’s pretty interesting because one of the things we had years ago and I don’t know if you still have those, we, we thought we were gonna have shortfalls because no one was in control we actually had double payments. Where many carriers have actually overpaid…”

Christine: “That’s right”

Jim: “…and we had to reallocate their overpayments back to the, them when we collected money from. Is it still the same like that?”

Christine: “ It is still the same and just to do a quick recap, on a recovery file that we did a couple months ago, we actually recovered over a million dollars for that client of,  just like you said, of payments that were sent as a double payment or payments that weren’t even registered, recorded correctly. So we had, we basically found that money and were able to recover it back from the carrier in order to get it over to the client.”

Jim: “Yeah well, I can see how that can happen because let’s say you have four or five people that are supposed to share an invoice and you send the invoice out to the people that are supposed to be paying a portion of that and they look at the invoice and they pay the whole thing…” 

Christine: “And then they’re gonna pay the full amount of the invoice” 

Jim: “And they don’t realize that they’re only responsible for 50% or 20%, or whatever the number might be.”

Jim: “So, I…”

Christine: “That’s correct”

Jim: “ I, is that how it happens?”

Christine: “That’s exactly how that happens and unfortunately in a lot of these cases the vendor may not know who to send that payment back to. So the vendor has been overpaid and they don’t know what to do with that money, right? They don’t even know who to get in touch with so we thought we come into play where we’re able to get in touch with that vendor through our reconciliation process. We have now communicated with that vendor, there have been overpayments, the vendor will now send us the money where we can now distribute it back to the carriers on those overpayments that they didn’t even realize they overpaid. Just like you said, they’re looking at the face value of the invoice instead of their own, their portion that they’re supposed to be paying.”

Jim: “So it’s really a two-step process. The first step before you do anything is you have to do the reconciliation.”

Christine: “That’s correct.” 

Jim: “Because if you don’t have a reconciliation then you don’t really know where to go…”

Christine: “That’s correct” 

Jim: “…the recovery process which is what most people think you’re probably hired for is the second part of that …”

Christine: “That’s correct” 

Jim: “…and, and it has to be because you certainly can’t have a recovery process until you know exactly what really happened.” 

Christine: “Right. The reconciliation and research process before we even worry about the recovery process can take months because we’re in communications of you know… in some cases, we might have 20-25-35 vendors in a particular matter, there maybe, you know, anywhere from, you know, 10-15 trades. So you’re dealing with all of these disappearances, you know folks, trying to get all this information from them until you actually have the correct reporting, the correct allocations, overpayments, or what have you and then you can start your recovery process of getting all that money back or getting people paid, that still may have outstanding invoices.”

Jim: “And you’re doing all this 5 or 10 years later and some of these companies aren’t even in business anymore.”

Christine: “That’s correct too. They may not even be in business, they’ve moved, nobody has the information or contact information.”

Jim: “Ah that’s where the risk transfer comes in.” 

Christine: “Uhm”

Jim: “That’s why you need an additional insured endorsement on your insurance policy so that you can be sure that somebody is alive to pay you.”

Christine: “That’s correct, 

Jim: “Wow”

Christine: “That’s correct.”

Jim: “How about that? It’s all fitting together in my head.”

Christine: “But it, it’s a, it’s a, it can be a long process but it’s a, it’s very rewarding believe it or not once we get to those, those 0 balances. So it’s something that you know, we, we enjoy doing if that makes sense. And you know, once we get all of those calculations, and everybody paid where they need to get paid and money back in the client’s hands. You know, it turns out to be a very rewarding experience for everybody involved.”

Jim: “Wow. Well, that makes it fun. If you don’t have a job then working is fun.” 

Christine: “That’s right, that’s right.”

Jim: “Well, thanks very much for that information Christine, is always a pleasure again to see, and I can’t wait for the next one. Think up a good topic.”

Christine: “ I will and thanks, everybody. Thanks, Jim for today.”

Jim: “Oh, my pleasure.”