Beware of Beckett!

[Bobbycee]

Ask for your money back ASAP. Send your cards to SGC.

[Rich Klein]

19 months is a long time but in Beckett's defense on charging cards earlier -- let me remind you of the Marx Card debacle earlier this year with PSA

https://www.sportscollectorsdaily.co...or-bankruptcy/

I get the card should be charged closer to when the cards are, you know, graded. But the TPG's have to protect themselves as well and the Marx card story was a heck of a wake up call

Rich

[bobbyw8469]

Originally Posted by Rich Klein

19 months is a long time but in Beckett's defense on charging cards earlier -- let me remind you of the Marx Card debacle earlier this year with PSA

https://www.sportscollectorsdaily.co...or-bankruptcy/

I get the card should be charged closer to when the cards are, you know, graded. But the TPG's have to protect themselves as well and the Marx card story was a heck of a wake up call

Rich

The Marx card debacle was on them and NOT PSA. They were the ones accepting money up front and instead of putting it in escrow, they spent it like it was theirs!!! The money WAS NOT theirs!! It was earmarked to go to PSA.

[Rich Klein]

Originally Posted by bobbyw8469

The Marx card debacle was on them and NOT PSA. They were the ones accepting money up front and instead of putting it in escrow, they spent it like it was theirs!!! The money WAS NOT theirs!! It was earmarked to go to PSA.

Bobby:

With all due respect, even Nat Turner said this was a wake up call for PSA about how to process payments and when to process payments. So it actually was on PSA but going forward a situation such as that would not be on PSA

This is the statement made by PSA after the fact

This is an unfortunate incident and our top priority is protecting the collectors who may have been impacted by the bankruptcy of Marx Cards. We are currently requesting detailed account information from Marx Cards for the impacted orders still at PSA with the expressed goal of returning cards to their rightful owners as soon as possible. We will not be charging customers for the return of their cards, other than shipping. As of yet we have not received payment from Marx Cards to grade the cards in our possession and as a result of this incident, we will be making changes to our group submitter requirements, including a new order upfront deposit and more robust policies around late payments. We will also be requiring all group submitters to bring their accounts current in order to continue service with us. We ask for patience while we sort through this expensive and labor intensive process with the end goal being the return of cards to their rightful owners.

If you have submitted cards to Marx Cards that you believe to be at PSA, please email curielj@collectors.com with “Marx Cards” in the subject line.

[Leon]

Originally Posted by Rich Klein

Bobby:

With all due respect, even Nat Turner said this was a wake up call for PSA about how to process payments and when to process payments. So it actually was on PSA but going forward a situation such as that would not be on PSA

This is the statement made by PSA after the fact

This is an unfortunate incident and our top priority is protecting the collectors who may have been impacted by the bankruptcy of Marx Cards. We are currently requesting detailed account information from Marx Cards for the impacted orders still at PSA with the expressed goal of returning cards to their rightful owners as soon as possible. We will not be charging customers for the return of their cards, other than shipping. As of yet we have not received payment from Marx Cards to grade the cards in our possession and as a result of this incident, we will be making changes to our group submitter requirements, including a new order upfront deposit and more robust policies around late payments. We will also be requiring all group submitters to bring their accounts current in order to continue service with us. We ask for patience while we sort through this expensive and labor intensive process with the end goal being the return of cards to their rightful owners.

If you have submitted cards to Marx Cards that you believe to be at PSA, please email curielj@collectors.com with “Marx Cards” in the subject line.

Rich, 19 months is too long to hold someone's money. There is no defense for that. It's just wrong.
.

[Rich Klein]

Originally Posted by Leon

Rich, 19 months is too long to hold someone's money. There is no defense for that. It's just wrong.
.

Leon:

I think I implied that 19 months was too long. Yes no argument from me on that. Just pointing out the danger of not charging a card or getting payment in advance. I think I even said, the payment should be closer to, you know, when the card gets graded. I think in today's world a good time frame is about6 months out and that should by the end of the year be a normal time frame.

[Leon]

Originally Posted by Rich Klein

Leon:

I think I implied that 19 months was too long. Yes no argument from me on that. Just pointing out the danger of not charging a card or getting payment in advance. I think I even said, the payment should be closer to, you know, when the card gets graded. I think in today's world a good time frame is about6 months out and that should by the end of the year be a normal time frame.

Holding someone's money for 6 months is wrong too. They should have to pay interest on it! How about 60 days? And to me that is being very lenient.
.

[Dead-Ball-Hitter]

Originally Posted by Leon

Rich, 19 months is too long to hold someone's money. There is no defense for that. It's just wrong.
.

Agreed, think of how much your collection/investment might be impacted. How could you run a little (or large) side business in collectables without having an inventory to churn? How can you pay for services two years ahead of when the service is actually performed, and not have a way to recover that expense in the meantime by selling, if that's your desire? Not to mention the many market fluctuations caused by economic upheaval, the fickle investing public, and potentially unrealized performance (of any newer players).

Folks might consider going to SGC. Right now they continue to be the only ones honoring the service level times.

[BobC]

Originally Posted by Rich Klein

Bobby:

With all due respect, even Nat Turner said this was a wake up call for PSA about how to process payments and when to process payments. So it actually was on PSA but going forward a situation such as that would not be on PSA

This is the statement made by PSA after the fact

This is an unfortunate incident and our top priority is protecting the collectors who may have been impacted by the bankruptcy of Marx Cards. We are currently requesting detailed account information from Marx Cards for the impacted orders still at PSA with the expressed goal of returning cards to their rightful owners as soon as possible. We will not be charging customers for the return of their cards, other than shipping. As of yet we have not received payment from Marx Cards to grade the cards in our possession and as a result of this incident, we will be making changes to our group submitter requirements, including a new order upfront deposit and more robust policies around late payments. We will also be requiring all group submitters to bring their accounts current in order to continue service with us. We ask for patience while we sort through this expensive and labor intensive process with the end goal being the return of cards to their rightful owners.

If you have submitted cards to Marx Cards that you believe to be at PSA, please email curielj@collectors.com with “Marx Cards” in the subject line.

Rich,

This PSA statement seems to indicate they are now looking to simply return ungraded cards to Marx customers, and only charge them a return shipping fee. However, in that Sports Collectors Daily article you earlier provided the link to, it pretty clearly stated in that article that, I quote, "PSA has pledged to complete the process of grading the thousands of cards collectors had sent to Marx at no cost". That reported statement doesn't seem to jive exactly with the PSA one you just posted. So, is the SCD article full of crap or am I misinterpreting something?

In an earlier post I was lauding the now privately owned PSA for doing such a great thing, based on that article, and wondering if the former publicly traded PSA would have been so benevolent. It seems my earlier post and question may now be mute. Hmmmm!

[Rich Klein]

I think one of the confusing aspects was one of the vendors who used Marx Cards as their group submitter flew out to PSA and on his own dime paid (for a second time) to get those cards graded by PSA.

I'm not sure what the conclusion of this saga was but I do feel comfortable in saying everyone goofed up in this but PSA by not processing a payment ended up with collectors in a precarious position not of their own choice.

[bobbyw8469]

I repeat....the fault lies with Marx cards collecting money and not escrowing it to pay PSA. They HAD to have known that bill was going to come due. Instead, they chose to treat the money as their own personal piggybank. That was 100% on them. I do group subs here. Granted, not on the scale that they do. But the money I collect, is NOT spent on fancy dinners out. It is earmarked for PSA. Marx Cards sounds like a hack operation.

Originally Posted by Rich Klein

I think one of the confusing aspects was one of the vendors who used Marx Cards as their group submitter flew out to PSA and on his own dime paid (for a second time) to get those cards graded by PSA.

I'm not sure what the conclusion of this saga was but I do feel comfortable in saying everyone goofed up in this but PSA by not processing a payment ended up with collectors in a precarious position not of their own choice.

[drcy]

The upfront payment is fine. The 19 months wait is not. That's closing in on two years! I know of the waits in card grading, but in any other industry these delays would result in lawsuits and perhaps even State Attorney General intervention. It's bordering on that this almost isn't a legitimate business model.

[55koufax]

Somehow I missed this Marx debacle....

That said, with all the changes in this industry, bulk rate submissions are history.

Looks like there is an opening for a grading company who is willing to service bulk rate clients.

[BobC]

Originally Posted by Rich Klein

19 months is a long time but in Beckett's defense on charging cards earlier -- let me remind you of the Marx Card debacle earlier this year with PSA

https://www.sportscollectorsdaily.co...or-bankruptcy/

I get the card should be charged closer to when the cards are, you know, graded. But the TPG's have to protect themselves as well and the Marx card story was a heck of a wake up call

Rich

Wow! Wasn't aware of this till just now reading that link. As others have noted, Marx was in a sort of fiduciary capacity in that they collected grading fees on behalf of customers, which was never their money. They were also paid their service fees, up front in most cases apparently, which should have been the only money they were using to cover their ongoing costs. So, I would hope that bankruptcy be damned, and that the Marx owner(s) can be held personally liable to some extent for those customer's grading fees they should have never spent.

Probably the way the customer contracts/agreements are worded will be vague enough, or otherwise worded, to get them out of any normal personal liability for the bankrupt company's debts though. This is assuming of course that the company was set up in such a way that it afforded personal liability protection to the owner(s) in the first place.

Regardless, glad to hear that PSA stepped up and will not charge the customers the grading fees they had already paid to Marx. I wonder if the old, publicly held, PSA would have been so generous? A few very well off, private owners getting together to make such an image positive decision is one thing. Getting thousands and thousands of shareholders to think that is the right thing to do is quite another though.

[CurtisFlood]

Originally Posted by Rich Klein

19 months is a long time but in Beckett's defense on charging cards earlier -- let me remind you of the Marx Card debacle earlier this year with PSA

https://www.sportscollectorsdaily.co...or-bankruptcy/

I get the card should be charged closer to when the cards are, you know, graded. But the TPG's have to protect themselves as well and the Marx card story was a heck of a wake up call

Rich

Wow Rich! Marx must have been doing a lot of skimming.

[Exhibitman]

"Marx, which had been approved by PSA as a group submission outlet, indicated it had taken in over $954,000 in 2020, had $4.4 million in revenue during 2021 but because of its debts, ran out of money in August."

"the company says the suspension of PSA’s lower cost services last year resulted in a disruption of its revenue. After ramping up its business in 2020 including the opening of a storefront, Marx says it “was in so much debt that all revenues were being absorbed by the daily and weekly payments to merchant banks which made loans to the business.”

"In the bankruptcy documents, Marx blamed PSA’s 2021 shutdown of most service levels on much of its troubles, but also cited another business’ failure to pay some $60,000 it was owed and two bookkeepers it hired. In its filing, Marx indicated the bookkeeper paid herself about $50,000 more than the $48,000 per year salary she was supposed to receive. Both of the company’s bookkeepers left their jobs in November of last year. It also says a customer failed to pay a $60,000 debt to the company related to card grading."

So, gross revenue quadrupled but a $110K loss ate the customer money? Suuure. The Marx guys should be going to jail for theft for what they did. Lots of businesses get money from customers in advance. Whether you call it a deposit or a retainer or an advance, it is still money paid in trust for a service. That money should have been there held in a segregated account regardless of the company's financial woes. Instead, it sounds like Marx treated it like a piggy bank and in effect ended up running a ponzi scheme.

[BobC]

Originally Posted by Exhibitman

"Marx, which had been approved by PSA as a group submission outlet, indicated it had taken in over $954,000 in 2020, had $4.4 million in revenue during 2021 but because of its debts, ran out of money in August."

"the company says the suspension of PSA’s lower cost services last year resulted in a disruption of its revenue. After ramping up its business in 2020 including the opening of a storefront, Marx says it “was in so much debt that all revenues were being absorbed by the daily and weekly payments to merchant banks which made loans to the business.”

"In the bankruptcy documents, Marx blamed PSA’s 2021 shutdown of most service levels on much of its troubles, but also cited another business’ failure to pay some $60,000 it was owed and two bookkeepers it hired. In its filing, Marx indicated the bookkeeper paid herself about $50,000 more than the $48,000 per year salary she was supposed to receive. Both of the company’s bookkeepers left their jobs in November of last year. It also says a customer failed to pay a $60,000 debt to the company related to card grading."

So, gross revenue quadrupled but a $110K loss ate the customer money? Suuure. The Marx guys should be going to jail for theft for what they did. Lots of businesses get money from customers in advance. Whether you call it a deposit or a retainer or an advance, it is still money paid in trust for a service. That money should have been there held in a segregated account regardless of the company's financial woes. Instead, it sounds like Marx treated it like a piggy bank and in effect ended up running a ponzi scheme.

Adam,

I thought the exact same thing you did. This bankruptcy filing is either due to complete business stupidity, or tantamount to intentional criminal theft, or a combination of both. Otherwise, how after more than quadrupling your business in a single year can you suddenly end up with assets less than $100K, and debts exceeding $1M. There is no major inventory or capital investments required for what they were doing. You could literally run the type of service business from your house/garage if you really had to. So, what were the monies from the debts they incurred used for? This doesn't add up at all.

For one thing, the bookkeeper that paid him/herself the extra $50K, that is embezzlement. I wonder if they pressed charges and are looking to recover at least some of that embezzled money. I would certainly expect the bankruptcy court to ask such a question. And why did they suddenly have to open up a storefront? I don't really think you'd be expecting a steady stream of customers to come walking through the door for this type of service. If so, during the pandemic and all, you're a complete idiot. And the one outfit that stiffed them for $60K, as with the embezzling bookkeeper, I'm fairly certain the bankruptcy court will be interested in the status of that potential claim as well.

I've been involved with businesses and accounting for long enough to know that this Marx bankruptcy stinks to high heaven. Just from the few details put forth in this thread, the situations screams as to the owner(s) or somebody draining money from the Marx company to put them in their current bankrupt position. And yes, I have personal experience over the years dealing with businesses and people that have embezzled or misused funds, or that have run themselves into the ground (and bankruptcy) for stupid and intentional reasons. As I had stated in an earlier post, I would hope the Marx owner(s) can be held to at least some personal liability in this case, if not potentially some criminal charges as well. Unfortunately, the way our legal system is set up, people very often walk away from such bankruptcies with little to no damage or consequences, and no liabilities to themselves personally. Many supposed great business minds seemingly use bankruptcy as an ongoing tool to get, and stay, ahead. All the while damaging and hurting countless other people and businesses, while they walk away virtually unscathed. I just wonder now what the underlying case is with this Marx company, and how that will end up?

[Exhibitman]

The way BK can be manipulated is ugly AF. For example, one of my landlord clients had a deadbeat tenant that kept filing BK without doing the supporting schedules. The court would toss it out after 60 days but it would derail the eviction case each time. My client finally had to get a court order prohibiting it, which took months and cost $10K. The tenant ultimately skated on a year of rent before filing BK for real. My client got $0 as an unsecured creditor.

[Michael B]

Originally Posted by Exhibitman

The way BK can be manipulated is ugly AF. For example, one of my landlord clients had a deadbeat tenant that kept filing BK without doing the supporting schedules. The court would toss it out after 60 days but it would derail the eviction case each time. My client finally had to get a court order prohibiting it, which took months and cost $10K. The tenant ultimately skated on a year of rent before filing BK for real. My client got $0 as an unsecured creditor.

Adam,

So true. I have run into people with multiple bankruptcies that keep getting dismissed. How I dread running PACER (Public Access to Court Electronic Records for those who do not know) for one of those people. They have learned to play the game using legal stall tactics. It takes a judge to say no and threaten criminal prosecution to stop it in some cases.

As to this Marx case, I suspect a smart DA could argue criminal charges under RICO. Interstate business activity to defraud investors. It does not matter what they intended to do it is what they did do. Additionally, if they used the USPS to send the items to PSA there could be possible mail fraud.

If PSA first came out and said that they would return the items to the individual owners at no charge and then issued a statement saying that they would return at no charge except for shipping they may run into problems. I suspect that the first statement would hold, especially if it was in writing (implied contract?), as an offer that each owner could accept. I would defer to you on contract law.

[BobC]

Originally Posted by Exhibitman

The way BK can be manipulated is ugly AF. For example, one of my landlord clients had a deadbeat tenant that kept filing BK without doing the supporting schedules. The court would toss it out after 60 days but it would derail the eviction case each time. My client finally had to get a court order prohibiting it, which took months and cost $10K. The tenant ultimately skated on a year of rent before filing BK for real. My client got $0 as an unsecured creditor.

True dat!

Heck, our former President who touts his business acumen and the "art of the deal" has successfully filed bankruptcy SIX times in the 90s and 00s. Never personally though, so he always walks away free and clear. Can only imagine the number of people and businesses hurt.

I fully understand the need and purpose for bankruptcy laws, but like as in your case, very smart attorneys can take advantage of those laws in some seemingly very unethical ways. And they are perfectly legal and able to do so. Nothing personal towards you, but that is a perfect example of why many people absolutely hate attorneys.

Judges and courts have to abide by the laws in place, and though even they may agree the actions were egregious and morally/ethically wrong, they can't really do anything about it till the relevant legislative authority changes the current laws, and the relevant executive authority signs off on the changes.

I'll have to share some of my bankruptcy horror stories with you. Just a little late in the evening right now.

[chalupacollects]

[QUOTE=Exhibitman;2212771]"Marx, which had been approved by PSA as a group submission outlet, indicated it had taken in over $954,000 in 2020, had $4.4 million in revenue during 2021 but because of its debts, ran out of money in August."

"the company says the suspension of PSA’s lower cost services last year resulted in a disruption of its revenue. After ramping up its business in 2020 including the opening of a storefront, Marx says it “was in so much debt that all revenues were being absorbed by the daily and weekly payments to merchant banks which made loans to the business.”


There in bold lies the rub. These Marx people were funding their business off of loans secured by their daily credit card receipts. How it works is the processor loans you money off of your daily or monthly average of projected (read future) card dollars processed for a higher rate than something secured and then the card processor pays themselves back on a daily basis by deducting the payment from the daily receipts sent back to Marx. So if you processed $1000 per day and your loan payment is $200 per day. They would fund you $800. It actually can also work on a daily percentage.

That said, once PSA shut down, Marx could not take payments or make payments hence the cash flow problem. At least a good part of it.

[Rich Klein]

One thing to remember, and this will NOT alleviate the pain of the OP, is the grading companies are working to catch up and should be caught up by the end of the year if not earlier.

These delays in processing should be concluded and the money held should be back to pre-pandemic levels by January 2023. Little comfort to the OP but an better news FYI going forward.

[rjackson44]

This is insane

[BobC]

[QUOTE=chalupacollects;2213106]

Originally Posted by Exhibitman

"Marx, which had been approved by PSA as a group submission outlet, indicated it had taken in over $954,000 in 2020, had $4.4 million in revenue during 2021 but because of its debts, ran out of money in August."

"the company says the suspension of PSA’s lower cost services last year resulted in a disruption of its revenue. After ramping up its business in 2020 including the opening of a storefront, Marx says it “was in so much debt that all revenues were being absorbed by the daily and weekly payments to merchant banks which made loans to the business.”


There in bold lies the rub. These Marx people were funding their business off of loans secured by their daily credit card receipts. How it works is the processor loans you money off of your daily or monthly average of projected (read future) card dollars processed for a higher rate than something secured and then the card processor pays themselves back on a daily basis by deducting the payment from the daily receipts sent back to Marx. So if you processed $1000 per day and your loan payment is $200 per day. They would fund you $800. It actually can also work on a daily percentage.

That said, once PSA shut down, Marx could not take payments or make payments hence the cash flow problem. At least a good part of it.

Tim,

Here's the unanswered $64,000 question, WTF did they do with all this money they borrowed? It obviously wasn't left in the Marx business or used to buy assets still in the business. So, did they intentionally plan this to pull out or use the funds personally, and then file bankruptcy to get out of paying it back? Or maybe they made some stupid investing ot business decision(s) that led them to lose the money. As Adam pointed out before, the $60K of bad debt from one customer, plus the $50K allegedly stolen by the one bookkeeper, doesn't begin to explain the over $1M in outstanding debts they reported in their bankruptcy filing. I'm assuming (actually hoping) the court requires at least some fundamental forensic accounting be performed on the Marx company books to maybe find out what was done to really get the company in the position it is now in, and to determine to what extent the owner(s) were intentionally involved so as to decide if there are any potential civil or criminal charges or penalties they may be liable for.

[D. Bergin]

Originally Posted by BobC

Tim,

Here's the unanswered $64,000 question, WTF did they do with all this money they borrowed? It obviously wasn't left in the Marx business or used to buy assets still in the business. So, did they intentionally plan this to pull out or use the funds personally, and then file bankruptcy to get out of paying it back? Or maybe they made some stupid investing ot business decision(s) that led them to lose the money. As Adam pointed out before, the $60K of bad debt from one customer, plus the $50K allegedly stolen by the one bookkeeper, doesn't begin to explain the over $1M in outstanding debts they reported in their bankruptcy filing. I'm assuming (actually hoping) the court requires at least some fundamental forensic accounting be performed on the Marx company books to maybe find out what was done to really get the company in the position it is now in, and to determine to what extent the owner(s) were intentionally involved so as to decide if there are any potential civil or criminal charges or penalties they may be liable for.

Bob, you're the accountant, but stating they had $4.4 Million in revenue (not profit) doesn't really mean a whole lot, if as a bulk submitter they are working on tiny margins, and of that 4.4 million, they owe PSA 4.2 million in fees, their employees money, lousy book-keeping and getting skimmed from the inside, and also trying to float loans while PSA is taking close to two years to make their customers happy.

Not saying they're innocent in any way. Just that it was very likely a very poorly thought out business model. They also probably skimmed a lot of salary at the top before they filed for bankruptcy also...so don't mistake this for sympathy for them either.

[Jay Wolt]

Originally Posted by Bobbycee

Ask for your money back ASAP. Send your cards to SGC.

He paid $7300. at $8 each for his +850 cards
W/ SGC's $30 cost, it would cost him in excess of $25,500
Either way, its a tough pill to swallow

[mrreality68]

Originally Posted by Jay Wolt

He paid $7300. at $8 each for his +850 cards
W/ SGC's $30 cost, it would cost him in excess of $25,500
Either way, its a tough pill to swallow

+ 1 agreed.

Huge price difference but super long wait

[glchen]

Originally Posted by Jay Wolt

He paid $7300. at $8 each for his +850 cards
W/ SGC's $30 cost, it would cost him in excess of $25,500
Either way, its a tough pill to swallow

I know it's difficult, but I'm of the opinion that the OP should just continue to wait even if it's another year before he sees his cards back (after they are graded). The $8/card grading fee is most likely a thing of the past, and I wouldn't be surprised if it's at least $15/card in the future. I completely understand that it's very difficult to continue waiting but hopefully the value of the cards at Beckett has appreciated in the meantime.

[doug.goodman]

Hahahahahahahahahahahaha

I love the opinion sellers, they are always worth a laugh

[Snowman]

Originally Posted by doug.goodman

Hahahahahahahahahahahaha

I love the opinion sellers, they are always worth a laugh

Yep, pretty funny. Perhaps almost as funny as the raw-only sellers...

"My Hank Aaron RC is NM-MT! I'll take $85k for it please."

"But it's not graded. Is there something wrong with it? Why isn't it graded?"

"Grading is a SCAM! That'll be $85k please."

"I love the card, but I just can't offer you graded prices for a raw card, I'm sorry. Best I can do is $4,225."

[Deertick]

Originally Posted by Snowman

Yep, pretty funny. Perhaps almost as funny as the raw-only sellers...

"My Hank Aaron RC is NM-MT! I'll take $85k for it please."

"But it's not graded. Is there something wrong with it? Why isn't it graded?"

"Grading is a SCAM! That'll be $85k please."

"I love the card, but I just can't offer you graded prices for a raw card, I'm sorry. Best I can do is $4,225."

I think the point is that the card hasn't changed whether it is entombed or not. With the exception of $0.17 of plastic, the cards value is the same. Like it or not, the premium assigned is due to laziness, lack of knowledge, and /or the need for affirmation.

Comparable to an appraisal for my grandfather's ring. I will never sell it, but an heir might. The insurance company required pictures, measurements, and a description. The accompanying piece of paper changes nothing in regards to it's value. But the size of the stone, weight of the gold, age, etc. has now been defined for my ignorant ass and for my lazy kids.

Or maybe a bucket of dirt with a pound of gold in it. Separate and melt into a bar and, voila! You have a more marketable item that will sell for more than it's intrinsic value.

Disclosure: I once refused a free PSA service at a card show. I have never submitted to a grader (as yet). I have had less than a dozen in my possession for a very short period of time. I have probably held less than two dozen.