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The Albany Group said its U.S. and other operations outside the United Kingdom are not affected by recently reported difficulties with its U.K. bank and payments to contractors and staffing agencies.
This week U.K.-based Recruiter magazine reported that Albany Group apologized for any inconvenience or financial hardship to staffing companies and contractors after a 3 million Pounds factoring facility for three of its UK companies was withdrawn.
In a Jan. 12 letter to a recruiter, Albany said that on Dec. 16, "the lenders stopped us drawing funds down despite having in excess of 7 million Pounds of receivables against a maximum draw down facility of 3 million Pounds," according to the report. At the same time Albany said the lenders "proceeded to capture all incoming funds received from clients and staffing companies with the sole objective of recovering money owed to them."
As a result, the company said that "for the last three weeks it has not been able to pay many contractors or staffing agencies who are owed money by any one of the three Albany companies," according to the report.
Albany said it uses a U.S.-based bank in the U.S. and remains strong with payments continuing. It also uses a Dutch-based bank for its Netherlands operations and a local bank for its Asia Pacific operations.
A company source said Albany won a major account in the U.K. that was larger than first thought, and the Royal Bank of Scotland balked at the 65-day payment term requested by the client. The source said the Royal Bank of Scotland has been under pressure and was reviewing its business. The bank was a casualty of the 2008-2009 crisis and is now 84% owned by the U.K. government.
Albany serves as a managed services provider, provides payrolling services and independent contractor compliance services.