Prefer to read? (Transcript)
Speaker 1 00:13 Hey, good morning everybody. Happy Saturday. Welcome to another show. You’re listening to business illegal talk with Leah and Claudia. Erin and I am your host Leah Landa. Virta shout out to my cohost, Claudine. Hello. What’s up?
Speaker 2 00:28 Super glad to be back and super glad to be done moving.
Speaker 1 00:31 I know you just moved to from, you have this palatial state office now.
Speaker 2 00:36 We’re very excited so we, we will still be keeping a presence in Turlock. We are not, we’re not moving out of Turlock by any means. Um, but we did move to a bigger office space up in Modesto on Standiford. So we’re really excited. Beautiful office. I’m ready to start the, I would say start the new year. We feel like we’re starting a new year. Of course. It’s no, you know, middle of the year. Um, but it’s a whole new program and we’re, we’re excited. Um, and uh, really, really looking forward to getting back to business and, and you know, just no matter how much you plan, no matter how much you try moving just is terrible. It’s just terrible. You can’t get around it. You know, we, we, we tried to, you know, plan and, and luckily shout out to our it guys. We had some great it folks helping us get, you know, set back up, unplugging the computers and all of the stuff is easy. It’s uh, when you go to turn it on, when you get to the new location and things turn on, sometimes they turn on for three minutes and then they turn back off again and um, and expect the unexpected, right? Yeah. Shout out to a tech heroes down in, uh, in the central Valley. Really appreciate you guys helping us out. Getting us back to work. Um, and the phones ring and the computers work. So amen.
Speaker 1 01:51 Hey, so my producer is laughing at me. I think the longer we are in the show, the goofy or will you get whatever it takes for some laughs. Right, right. So shout out to our producer too. Yes. What’s up? Look
Speaker 2 02:02 what it looks like. That, forget that I was moving. He thought I just abandoned you for two weeks.
Speaker 1 02:06 Yeah. He felt sorry for me. I did a couple of shows on by myself and let me tell you this, um, radio business and talk show business does not meant to just one person. So I was literally crawling in a fetal position on the edge of the studio and look, had to come and rescue me and had to give me a pep talk. Leo, you can do this. And he’s laughing. No, I did it. I mean I was, but I am so much appreciative of what you do and how this show with the two of us, cause he’s just yin and yang. It’s just the energy of, you know, you doing your thing and talking about your, you know, complimentary angle on the legal side. And so that’s why we do the show together. I mean, that’s why it’s business illegal talk and that’s just not business.
Speaker 1 02:51 I mean, I could do it. It’s just emotionally draining when you’re sitting in front of the Mike for 60 minutes at a time. I don’t know. We were talking before show started. How do people do it for three hours? I know, I know. It’s a lot. And especially when you’re, there’s no interaction yourself. You must have a lot to say. I’m not sure I have that much to say. I’m a talker, but I don’t have that much to say. So anyway, so great. Great to have your back. Lots going on. But that’s a good stuff. Um, we’re gonna be talking today about cybersecurity and data breach. So, um, for those of you listening to, if you’ve forgotten, uh, the 10 o’clock as you’re going to the, uh, home Depot and buy stuff, we talk to business owners, right? Our primary audience, our, um, is business owners who are either, uh, running and growing a business, you know, a going concern with 10 to 50 employees or, but we also speak to those who are just starting out, you know, just, just started a business and, and they have a questions about, well, where do I go for it?
Speaker 1 03:55 You know, insurance or general liability, professional liability and health insurance and worker’s comp and in, um, you know, do I incorporate, when do I do that in day? You know, of course all things legal. Claudine is the reigning queen of legal stuff. So that’s funny. But if you want to know how to plot your way to a multimillion dollar valuation and you want to figure it out, how to set up your accounting systems to do that and really come up with the, uh, the, the great indicators for growth and then you come to me, right. So, um, you know, we [email protected] on hq.com and thanks for the shadows that are the emails that we get and, and aware are you Claudine? We are on the [email protected] and that’s S H E R R O n-law.com and a of course now, as I mentioned now located on Stanford Avenue. Yes, beautiful office.
Speaker 1 04:47 Wow. I actually got a chance to, to, um, to, to, to visit it, um, just recently in huge, just a great building. But you know, we’ve had shows and we’ve talked about the perils of not doing leases, right. So, yeah. And it’s, you know, this one thing you don’t want to go out alone is dealing with a 25 page lease without having the watchful eye of somebody who knows what they’re doing. And that’s one thing, Claudine, that I, I love how you guys, you love real estate and commercial and how you guys are able to, you know, negotiate on behalf of the, um, of the tenants. Right? We are, we do, we do quite a bit of real estate work. Um, and we have recently been doing a lot more buying and selling on behalf of clients. So we are acting in the capacity as realtors and I’m, I’m a licensed broker and um, my associates are licensed broker and paralegals, also a licensed realtor. So we’re able to help them on that. So if people, um, if you need assistance, we’re certainly here for that. But I have to tell you, um, prior to us making the decision to move into this particular building, we, um, I had looked at a number of places and you know,
Speaker 2 05:58 I know that going just going through the regular process that everybody goes through, you call on the ad and you make an appointment and you go look at it. And I have to tell you that we, we really got lucky. We, we failing into communications with the agent that was, um, the listing agent on this particular property and he made the job so much nicer and so much easier. He immediately assessed my needs and said, okay, wait a minute. The building you’re calling on, I really don’t think it’s going to be the best for you, but I’ve got these, you know, let’s line up four of them. Let’s take two hours. We’ll run through them. And then I was able to bring my husband back who’s a contractor to determine, you know, what kind of improvements we were going to need to make and what we were looking at cost wise there.
Speaker 2 06:37 But you know, having somebody who is willing to be proactive and jump in and I didn’t have to ask, I didn’t have to ask for any of that. He just saw it. He’s, he knew what I was needing and jumped in and took care of it. So, um, just the lucky, I can’t tell you people on the bus, I can’t tell you about when you, when you come into contact with somebody who gets proactive about helping you solve your problems. You know, I just, it’s, that’s what we try to be for our clients. I know that’s what you try to do for your clients. And when I come across other business owners in the community that, that, that’s what they’re trying to do. Um, man, Oh man, it makes life a lot easier.
Speaker 1 07:12 You know, it just goes to show that you get what you pay for. Absolutely. A lot of people want to get stuff for free, you know, and, and there’s nothing wrong with going in and looking things up on Google and trying to piece meal something. But when it comes to your business, it might be fine to do it on your own for your personal finances. But when it comes to your business, you get what you pay for. There’s so much unqualified advice out there. And, um, professionals who they’re not really up to snuff, they don’t know. And then it has a domino effect. If they lack on some piece of knowledge that your CPA or your accountant needs or you know, or your lawyer is missing something. Indeed, we don’t have the right board of advisors, if you will, for your business. And one person misses the Mark and the other ones don’t catch a year in a world of trouble because you’re the one stuck with the bill.
Speaker 2 08:08 It is true. It is true. And I’ll tell you, we, you, you and I have talked about this on the radio and I think this is, you know, it’s never gonna be not important. Um, understanding the value of your hour, what, what your value is, man. Because it’s something that’s always running through my brain. And, and in our industry, we bill by the hour and there’s only so many hours in a day. So if I do spend six hours running around, looking at, you know, new office spaces, that six hours, I’m not actually working and I can’t get that six hours back. So, you know, when, when you’re out and you’re doing things and it’s taking forever and forever to get it done. And because you know, maybe you’re not in the right spot, don’t have maybe the right resources. And then when you come across somebody who can jump in and all of a sudden it happens so quickly, you think, Oh for goodness we took so long. So knowing the value of your time and your hour, um, what, what your value is. And that helps you know when to start to delegate to somebody who maybe can get it done quicker or you know.
Speaker 1 09:09 Yes. And you know what, about a year ago, you and I first started working together and I remember saying that right about a year ago and I remember saying, what is, how much is that, you know, an hour worth of your time. And then the, and the thing that you really got right away is like what happens if I give this, you know, if I’m doing things that are what I would be willing, you know, charging clients. And so you basically, you’re taking all those jobs that you could be assigned to somebody else at a much lesser rate. Um, and then you’re losing out, right? So anyway, so there, there we’re going to be talking about cyber security and there’s just big data breach that happened at capital one. And how would that affect your business? You’re listening to business, illegal talk with Leah and Claudia. Stay tuned. We’ll be right back.
Speaker 0 09:54
Speaker 3 10:07
Speaker 1 11:06 alright, all we’ll come back. I would just enjoined us on too much. Thunderstruck why don’t we wait. We’ll get you a shot at it started right? Little old school. All those. All school, they ACE called all rock still. Come on. Hey, welcome back everybody. You’re listening to business and legal talk with your, Claudine, you got a little carried away. I was doing my air guitar right now. So you, are you musically musically inclined? Yes. Used to be, um, I used to be in a band in college. Really? Um, rhythm, guitar and vocals. Really? Yes. I’m dating myself. This was in early nineties, eighties and uh, I used to do a performance at a school. Wow. I am super not inclined at all. Oh, that would be the kind of, it’ll be the kind of guy with a microphone throwing myself, you know, from one side of the stage to the other on my knees and just do back flips and stuff and look at you now.
Speaker 1 11:56 Look at me now. I turned into a CFO so would’ve thought, right. Not a rock star. That’s right. Anyway. Hey, so listen, we got a lot to cover so let’s get to it. Um, what’s the deal with capital one, right? If you’ve been watching the news, it’s all over it. Hello? Over. What happened? Well data breach, somebody hacked into their system and managed to get 140,000 social security numbers. How many hundred and 40,000 social security? No, that doesn’t count it. And I heard about a hundred million records. Well and another 80,000 link bank account numbers were exposed. So this happens so many with capital one. I do have an account with capital one. Um, and, and I, I’ll tell you this happened so much now that, I mean, how many of us just go, Oh, okay, data breach and, and what’s for lunch? What do I do about it?
Speaker 1 12:48 Nothing. That’s like, I super can’t do anything about it. Um, so, you know, kinda thought it would be good to talk about it and see what, you know, what other people are thinking about doing, um, or have, you know, have they been affected and have you had, have you been affected by a data breach that you know, not, I suspect that all of our data has been breached at some point. But have you ever had a negative effect over it? No. You know what, and knocking with vinyl, the what is all the wood in the studio. I mean, but we’re not going to, not, not directly. Um, but I, we had a couple of close calls. Really? Yeah. So it’s a close call, uh, when you’re notified by your it department. So we’ll just trying to hack into our website and they didn’t quite get in.
Speaker 1 13:31 Right. So that was somebody from a different country was trying to hack into the website and uh, I was notified. So w w was your website, is it just an informational website or a, didn’t have any, nothing to be taken that they had nothing sensitive on it. Okay. So, but they didn’t get in, but we were notified that somebody was trying to, um, get behind a code or something. And I have nothing to offer. I mean, there’s mood, not selling anything. There’s no credit cards on their website. But that brings up this whole topic that we’re going to talk about today. What if you did have, right. All this information that you’re supposed to protect, right? Um, uh, so, so, so I guarantee, I mean, if you’re a business owner at some point you’re going to be dealing with credit cards. They need electronic transfers and ACH and auto debits. Uh, think about the responsibility that this company’s have and to some degree the responsibility that we have to protect that information. We deal, we do have, we do. And I, I recall, um, you know, part of the conversation that we had with, um, with Deanna from Heartland, um, merchant services, she was talking about that trusted partners. I know, I just love him. I love Heartland, but there is, there is responsibility on us
Speaker 2 14:52 as business owners and in how we treat the data. When we take credit cards. Now for us take, we don’t take credit cards like over websites or anything like that. So we’ve minimized our, you know, exposure. But there are a lot of companies, especially in this, um, you know, this age of, um, you know, selling products online. Um, and so people are, are set up to take credit cards over the phone or take them, you know, through a website. And that does provide a little bit more exposure, but, you know, capital one, um, you know, has said that it has fixed the, the exploit or the, the hole that the hacker used to get in. Um, you know, and I, I just hackers from Russia, uh, you know, don’t know. I don’t know. Who knows? I mean, I suppose,
Speaker 1 15:39 I know, I’m just saying that kind of kind of making fun of it, but that’s what’s hot in that. And right now if you’re looking at political realm, right? All this compromised, uh, uh, um, the, the election, right? It’s the 16 election, um, pay, but the numbers are staggering. So let me read to you from this article. A data breach of capital one servers this month, exposing personal information of a hundred and of nearly 106 million. Wow. So that’s the personal impact. The banks, customers and applicants, not just the customers, but people who would actually applying in. And so we, we mentioned that the social security numbers were 140,000. That’s true. And about 80,000, 80,000. This is all big stuff, right? Um, a hundred and just let just land there 160, 106 million records and we have 310 million people in the U S and assuming that were all from the U S we’re saying one out of every third person.
Speaker 1 16:39 Yeah. Had some stuff. That’s how big this company is. Well, and the interesting part is what are the hackers going to do with that much information on the black market? So you know that here’s an interesting thing and it has nothing to do with the topic right now, but the dark web, have you heard about it? I haven’t heard about it. I have no clue. Like what is other than what you and I look up when we go, you know, the portals, the Google, the Facebook, the CNN and we, we browsed it all this carefully manicured websites for where you, where you re where you get information and you buy sir products or services that’s but less than 10% of what’s available in the web. Right. The other 90% it’s under the radar. You have to have special ways to get in. It’s like the underworld.
Speaker 1 17:31 So this hackers, you know, um, weapons, um, stolen information gets transacted. You know, the, the, it is transacted in this dark black market, right? It’s like a digital black market, black market. And the best way to describe it and what it is, is people that want to be remaining. I mean, if you know what you’re doing as a software person, you’re, you’re, you’re dangerous. I mean, it’s, you know, do you know that, um, I was watching the news the other day and um, nothing is more valuable now. The hottest commodity in the world. It’s not gold. It’s not oil, it’s data.
Speaker 2 18:14 Yo, there’s no question. It’s, it’s, it’s crazy to think when you start to realize how many companies, um, you know, are perhaps, or they’re selling some service on the internet. They are not there to sell the service. They’re there to collect your data and then they sell your data. And so things that you think are pretty innocuous or just, you know, benign random and you, you go on and you buy some product and they, they’re selling the product is just a way to get you to give up your data and then they sell your data. So it’s all about data mining.
Speaker 1 18:47 Facebook, well, let’s just think about this, the analogy, right? Some of the most, um, highly capitalized or most valuable in terms of, you know, that market capitalization, some of the largest companies in the world that the top 10 are all technology companies, right? And what is the product that they serve that they, they, they sell information data, right? Uh, it’s a frame, you know, basically Facebook and you know, you can have a Gmail account. It doesn’t cost anything for you to have it. No. And they can Bombardia because they’re willing to data world, right? They collect your information, they sell you, you know, here’s what’s creepy about this whole data thing. And have you ever been, um, your phone is off, right? And not to get conspiracy, but this is, this is, this is the power information. It happened. And then you think about, Oh gosh, you would be, um, I’m, I’m, I’m, I’m craving some Haagen. DAAs right. Or I wish I had a pole and that, see, you know, you get into your Facebook or anywhere you’re browsing in Indus ads, just pop, right. Pop this is not gonna freaky.
Speaker 2 19:50 It is. And it’s happened. And I know so many people who it’s happened to and they’ve done self. Oh my God. Ha. You know, and so I personally will not have, I’m one of those Alexis in my, in my house at first for me, I already have one in the office. They already heard everything that’s, and there’s so many people that I’ve talked to. I have a friend of mine who who he, he, one day I was joking with him cause he loves his Alexa and I was joking, I said, Oh come on, aren’t you afraid to recording you? He goes, I really don’t care. What am I like? Who cares if they’re recording me? Like on one hand I get it. That, yeah, okay, who cares? But on one hand I go, Oh, I don’t know.
Speaker 1 20:27 It shows through the door and you were thinking about buying it by the already in your mind, every person shows up. That’s not, that has to happen, but that’s the future. That’s the minority report, right? You’re going to be convicted of a crime before you think about it. Oh wait, I just thought about that. I never really did anything.
Speaker 2 20:41 What do you think about the free email server services that record and scan your emails?
Speaker 1 20:47 Like what? Like Gmail, those, I mean it’s free, right?
Speaker 2 20:53 You know how many business, you know how many attorneys use Gmail
Speaker 1 20:56 a lot.
Speaker 2 20:58 it makes me nervous because that is attorney client privilege. We could be breaching.
Speaker 1 21:02 Yeah, so you have to out here and even I have, so I, I have at Gmail for my personal, but I at this point who’s to say if you don’t have a Gmail account that is free side by side by a, know that account that is not free, that is controlled by your service. Who’s to say that information is not creeping back and forth? I don’t know that, but that’s beyond our grade because we would PR pretty great. It’d be great to have an it person in our R R as a guest to talk about these things. Great day. Hey, how about that? Let’s make a note. So we do have some great shows coming up and Oh, this shows a state, you know, we’ve got to have a great health insurance. Um, health insurance costs. I keep rising, right? What do we do? How does a business owner protect themselves?
Speaker 1 21:42 Stay tuned that we are, we’re actually doing a show next week on health insurance and we’re doing a show on state planning. So we’re out there looking out for you guys as business owners. So, so back to this. So what do we do in YT shoe? You care as a business owner, right? Um, capital one has the, the financial wherewithal to deal, to have a room full of it. Experts and software engineers fixing it. But what happens to the little guys? What happens to the rest of us? Well for sure. If, if we have a data breach for sure
Speaker 2 22:15 business owner and you have a data breach, um, I would say immediately, immediately take a deep breath. Um, and, and, and don’t do anything public immediately. What you really need to do is you need to assess the situation. You need to make sure that whatever you are going to say to customers or if you’re going to make a public statement, some companies were bigger and they would maybe make a statement, um, in a local newspaper or something along those lines. Whatever you do, you do not want to say the wrong thing and you definitely don’t want to lie or attempt to cover something up. Um, and so you need to take that break. You need to breathe for a second and you need to reach out to your resources, whether it’s your it person. Um, if you don’t have an it person, then you need to find one immediately to do an investigation.
Speaker 2 23:01 You should also, um, inform legal counsel. Um, a lot of times and this is some advice that we give business owners a lot, whether it be something like, um, an it breach or let’s just say it’s a harassment, um, claim from one employee to another. We’re going to do an internal investigation. You want to involve your attorney in that because what that does is it does create an attorney client privilege over a lot of information that maybe would not be, um, it would not be favorable if it got out. So if it was just a regular person who is conducting the interview, um, that information may or may not be privileged.
Speaker 1 23:39 So that’s a huge thing you bring to the table. I mean, I never really understood, um, that, uh, attorney client privilege until you actually had an a need to use it. And it is, it’s such a wonderful thing in our free world to be able to have that in the service that you provide. If people really understood, people usually go to attorneys, why don’t you, one, they’re too expensive. Well, if you really think in big and if you got into business, you got to do, you know, remember what I was saying, you get what you pay for, right? Free advice. It’s going to cost you millions in the future. Pay for their ride. One idea, one info type of information protected can help you end to hundreds of thousands of dollars in the future. So anyway, so you’re saying, so what do we do when there, so let’s assume that there is, so let’s, let’s walk through a business owner to what happens if there is a data breach.
Speaker 1 24:32 Uh, and we’re going to be covered covering a lot of that in the next couple of segments. But first, number one, don’t freak out. Don’t breathe. Breathe, okay, clean. I’m breathing and breathe. And then we’re going to start to create a plan. And when you create a plan, okay, I’m breathing you reach out to your resources. Okay? All right. Well, okay, so we’re to keep you on a waiting and guessing what’s going to happen, right? If we have to go to break a, you are listening to business and legal talk with Leah and Claudia, stay tuned. We’ll be right back.
Speaker 4 25:02
Speaker 0 25:17
Speaker 1 25:29 alright, what’s up everybody? Welcome back. Happy Saturday. Hope the weather, the street in unites today. So welcome back. You’re listening to business. Illegal talk with Leah. Claudia, we’re having so much fun today talking about cyber security stuff that happens that is so super
Speaker 2 25:44 Wharton, but it happened so often. It’s like so much of what’s going on I guess in society right now. As you know, we, we just hear about it happening all the time. Right? I mean w Equifax I think was so huge when the Equifax breach happened that even after that now, now capital one and you think how many millions of people, and I think everybody just presumes that they have already had their data breached anyway.
Speaker 1 26:09 Right? And he happened in 2017 and the numbers were staggering. Even then what 147 million records compromised. So you would think, Oh, 106 million is not that much. I mean it’s, it’s just no matter what, that’s what it was 147 million equity Fox, um, situation here. The Equifax, when was the 17 and the 17. So two years later we have, so is it going to keep happening and clothing?
Speaker 2 26:34 I, I can’t, I can’t
Speaker 1 26:38 look into your crystal ball right now. Right now, here I go. Okay, here we tap my powers.
Speaker 2 26:44 Um, no, but I can’t, I mean, unless they were in, unless these companies were not allowed to keep our data right. You know, you apply for a card and say, you know, a credit card through capital one or whatever, cartridge agency, and then they were required to destroy our data way on required or apparently not because they are getting it stolen.
Speaker 1 27:06 So, but let’s just go along with that. So the person that actually did this, you know, the person responds. Yeah.
Speaker 2 27:13 Right. What’s a U S person right in as a software person? One person, I think if I’m not mistaken, and I could be, but I thought that they said it was an ex employee. I don’t know. I may, I could be wrong one gal by herself, but think about the, it wasn’t even organized crime, right? Right. Yep.
Speaker 1 27:34 But if one person is able to do damage damage, what does it mean for the rest of us? And for the ones that are really know how to do this, you know, years back, somebody tried to get into the DOD, our department of defense, right?
Speaker 2 27:47 So no one is immune. No. And w what is really, really frustrating is that an over all of these years, and I say all these years, we’re talking what, you know, five to 10 years of of having data breaches and used to be really important and Oh my God, they’ve got my social social security number every single time. It’s still seems to be, um, the response is reactionary. I personally have heard nothing about what are we going to do going forward? You know, how do we stop this? Because it seems that from, um, a software or it or hacker position, there is no system that’s totally impermeable. Correct. There, there’s, there’s always going to be a waste for somebody to hack if they work at it hard enough and long enough. Um, so why are they even keeping our data?
Speaker 1 28:39 Well, okay, so I’m gonna before I forget, we public service announcement. I mean if, if you are affected, right, if you were one of those who actually in the last 24 months as applied to, you know, capital one and I think one of every three Americans has, right. Number one thing I would do is freeze your credit right now. Right. Um, they are, are, you know, they’re offering this free monitoring. I would take it, I mean, I guarantee you this is not going to be just a slap on the wrist kind of situation. I guarantee you that the insurance carrier for capital one is already tried. They’re already tapping into their, their legal team figured out because this is going to be a pretty good sized payout. Oh yeah. But before Ryan now to plaque eight and you know, the media they’re saying that they’re willing to, so you get on the phone or you email them and says, Hey, you need to freeze.
Speaker 1 29:27 You know, I would get into the fight co, you know, the, the experience th th all of the credit reporting agencies, because right now, you know, I may seem some seemingly disconnected, but if you’re trying to get a line of credit for business and you FICA drops and everything else looks fine, but you phaco drops a lot of the credit rating, uh, for underwriters, for loans in business or personal are piko driven. Yes, absolutely. So something happens to your credit score. Um, years and years ago I had a situation that we were obsessed. You know, I, I think I got my FICA almost to nearly, I think like eight Oh five, which is a 40 is the Holy grail. You’re walking on water at a 40, right? Nothing happens. You’re the best thing that has ever happened and everybody just gives you this a hundred thousand dollars. No. Now basically free, uh, loans, loans, loans, loans.
Speaker 1 30:17 No, but but um, non guarantee, which means signature loans, right? Until my FICO dropped and I had to pull the report and there was this account that I had that I didn’t know I had that a $5,000 line of credit and somebody’s been making payments on it. Of course they did. You know what happens? Somebody found it, somebody, my information in person impersonated me, got a credit card used to and was making payments on it. But because they, they risk the, the, you know, the top into the limit, right? And what we’ve been saying about how to manage your credit, you want to see your FICA go up, right? Don’t ever use your lines of credit 100% for months on end without paying it down. What credit card or loan companies or banks want to see is the kind of an even flow right up and down, up. And I know we don’t need it off the Sargent, but freeze your credit now if you to avoid any damage or farther damage.
Speaker 2 31:11 So freezing your credit just means that that no new accounts are going to be open. It doesn’t mean you’re closing accounts. No, that doesn’t mean you’re closer, but be clear on that.
Speaker 1 31:19 Yes. Thank you. So you notify the credit bureaus, right? Hey, uh, I want completely freeze my account means nobody can apply for credit, right? Not even me. No credits, no, it’s nothing. You freeze it. Where is that? No extended credits. Um, do you put alerts, you know, like, I need you to meet me. No. Be fired when anything happens. If somebody calls in and tries to apply it, even though it’s already frozen, you get the information and needs to be reported to you because it is your credit.
Speaker 2 31:50 Right? No, and it’s super, super important too that you’re working with banks that are proactive. Um, I know just from a banking and not even a credit card standpoint, but just from a banking perspective, I know that my bank, um, caught a really big, Oh, it could’ve been a really, really big one. And it happened to be, uh, with our client trust account where, you know, client trusts accounts are very, they’re very protected. It’s a very tightly regulated, highly regulated. It’s a very tricky thing. Number one reason why attorneys lose their licenses is not managing the account correctly. And so we had written a check to a client, um, it was their settlement and that the check was mailed to the client. The client, you know, had the check, whatever. Um, bank calls me three or four days later and says, um, there was a payment, a debit coming through my trust account and I said, debit, we, you know, there’s, there is no debits in a trust account.
Speaker 2 32:46 It’s, we write checks and we track the money very closely. And she said, no, it’s like an online debit. Somebody went online and paid a bill using your, using the um, um, the trust account information and they had taken the check at customer. Of course our client course source it had was not her, um, but they had taken the check, got the routing number, got the account number and went online and paid um, a credit card bill for like $40,000 with my trust account information. Oh my God, man. I’ll tell you what, my bank was so awesome. They called me before while it was still pending. And because they knew enough about client trust accounts to know that, you know, we just don’t debit out of trust accounts like that. This is just that that would be a very strange thing to have happened. Wow.
Speaker 2 33:38 And they stopped it. And I’ll tell you another couple of weeks ago, I went to a gas station to use my business, um, uh, debit card to purchase some fuel and it declined me. And I thought, well that’s kind of crazy. I mean, I know there’s money there. And um, came to the office Monday morning called my bank and she said, Oh yeah, there we had some suspicious charges on your car. And I said, well, I have my card. I didn’t lose it. Um, no, somebody in Vegas was, um, I had bought two, um, $125 purchases of fuel at a gas station in Vegas and I still had my card. So somebody somehow got my information or you know how they do it? They do it with those little card readers. They walk by you and had it right there. Yeah. I mean, so I know this happens to everybody though. It’s such a huge problem.
Speaker 1 34:32 So the whole point in this talk today, your or, or the topic of our talk show is not necessarily to fear the fear mongering and scare you. I think you should be well informed, but we’re all about helping you build a business that is profitable and sustainable. And nowadays with the market turning around, um, the, you know, the interest rates going down, you know, there’s going to be a credit available. You need credit. It’s unavoidable. You need to have in your arsenal as a business, the ability to borrow. Yes. And we’ve talked, we have talked plenty. There’s multiple ways you can raise capital and you don’t want to go to the private equity route in which I spent two shows talking about it last couple of weeks ago. And equity is expensive. It’s very expensive, the most expensive money you’ll ever part with, right? So why not just capitalize on a good credit score and get all the money that you need?
Speaker 1 35:29 Because when it, when did we say that we go to the back when we don’t even write down, because when we need it. That’s right. It’s too late. It’s too late. Um, I wasn’t listening to a talk show, um, uh, today on the way, um, you know, on the way to the studio. Right? And, uh, this is has to do with people that do, you know, I have a lot of my clients do government contracting, so, so we do government contracting and you know, the, the, the, the government does all these programs, you know, um, um, oldest government assistance to help businesses. Right. But it’s all predicated on the fact that you’re actually running a profitable business. Right? It behooves the government, when they give you a concert that you are profitable, right? They’re there. They’re in the same shoes as the bank. They’re not wanting to lose money here and there.
Speaker 1 36:18 They’re wanting to, you know, make money and if they’re going to loan you money, they, the, the, you need to be able to pay the money back. And so when you’re sliding downhill, um, is not the time that you can pay your money back. So here’s some actionable things. So you know, as, as you are, um, on your Saturday going around is if you feel the Cuban compromise, freeze your credit, right? Number two, if you haven’t been compromised, you need to know what your FICO is. There are ways that you can actually pull your credit score without affecting, you know, cause the score gets affected multiple ways. Credit usage or new accounts, but also inquiries, right? Can make your so many inquiries over so many months. Can you can drop 10 points. No, and it’s important because there’s a lot of mail theft that goes on.
Speaker 1 37:05 That’s why we have ring the ring bells and doorbells and all of that stuff. I’m mail theft. And what a lot of people are doing is they’re getting those credit card offers and they’re filling them out or they’re going online. If they get your social security number, they go online, they use your social and they fill out the credit card, put their address on it. Like what happened to you? Somebody using your social and then actually having an account and actually paying on it and actually making payments on it. Yeah, you will see that it’s helping my credit, but this is stuff that keeps me up at night. So in another note, check your mail every day, every day. You never gonna. Okay? Companies make billions of dollars of credit. I mean, you get this, it’s a multibillion dollar industry, right? You’re going to get stuff in the mail every day.
Speaker 1 37:47 What do you do? You need to go to your mailbox, pick up your mail, shred, whatever. But you can’t just neglect. And if you’re going to be out of town for any length of time, somebody needs to, you need to deputize somebody. Here’s a telltale sign to somebody who’s not home, the mailbox spilling with mail, right? There’s just, there’s just nobody. It’s just a bad sign. Newspapers on the era if you’re not doing that. Anyway. So those are the kinds of things do you need to freeze your credit? You need to contact fraud to contact fraud departments. You need to empty your mailbox and you need to get your FICA score. And you need to know if you’re using credit for, you know, if it is, if, and this is a little bit of accounting sidebar, if you’re using a credit card that you’re thinking about using for the business, both use it just for the business and stop commingling. Right? You know it’s going to happen, right? You’re going to get, well, gosh, I went to save out to buy groceries and on the business credit card. I don’t, you don’t do that, right? Nobody I w I mean I don’t ever intentionally, never intentionally. Anyway, so, Hey, so we could, we, we have to go to break. We’re gonna come back and kind of bring this home. So I hope this is helpful. Credit is key. You’re listening to business, illegal talk with and Claudine, we’ll be right back.
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Speaker 1 39:35 all right. All right. All right. We’ll come back. They said it’s a business illegal talk with Leo, Claudia, Andrew. We’re bringing it home. Hope you having some fun. I hope it will give you some actionable content. We are all about action and all about doing, you know, this is not theoretical stuff. We’re not reading from books. We’re doing this stuff every day. We’re helping business owners. We know what’s going on on a day to day basis. And you should pay attention to, to your business, you know, and there’ll be different times talking about different things. But today it’s, it’s very important. There is a huge uptick in the market. There’s a lot of opportunities to be had and whether it’s, whether you’re a government contractor on the private side, there is a lot of, I mean I’m dealing a lot with a lot of government contractors. You know, they, interesting. Yeah.
Speaker 2 40:17 We’re not, we’re not. I’ve got, I’ve got one client who, who is, um, and, and working through the, um, it’s kind of a, it’s a system through the government where they can bid on, once you qualify, you can bid for particular jobs. Um, but we’re not what type of industry or their, um, construction.
Speaker 1 40:37 It’s huge. I mean, you know, some of my, the companies that I work with in construction, they do a fair amount of government work. And we know that is through, um, um, RFI. RFQ is RFPs. Uh, we’re not talking small jobs. I mean, it’s really helping me to take a second look as to there is a, the government is a great payer. You know, that government is not going out of business. Theoretically
Speaker 2 41:03 we, I think there’s some rumblings, but in any event, I’m all good. Yeah,
Speaker 1 41:07 no, don’t, I don’t go there. I won’t go there. Walk into the light. Stop. Get out of there. That’s it. I’ll run. Let me turn around. Okay. So back to us. Back to credit. So you have some thoughts that he thinks that you wanted to share.
Speaker 2 41:19 Yeah, I think it’s, I think it’s important that people realize, particularly business owners. Let’s, let’s kind of move away from the consumer perspective. Let’s talk about it from a business owner perspective. Yeah. Credit is a tool. It’s the tool. Just like any tool that we have. There’s times where, um, you know, uh, speaking about government being a good payer, those who have done a lot of government work also realized that the government is a slow pair. I can be a very slow pair. And so, so sometimes you have credit to, you know, bridge the gap, so to speak. Um, and so you recognized credit as being a tool if you’re going to use it, if you’re going to have it, if you’re going to keep yourself exposed to some extent, um, for data breaches and all the rest of it, well then it should be a tool that works for you.
Speaker 2 42:03 I mean, there’s no sense in have an exposure if you’re, if the tools have zero value to you. So, you know, how do you use credit? What’s the best way to use credit, what we know, embrace it. If you’re gonna do it, embrace it and do it right. So that means you really do need to manage your credit. Um, in terms of keeping it monitored, you do need to look at it. So I’ve been lucky in that I’ve had my bank, you know, really, really, really proactive. Um, and they’ve caught some things, but had they not caught it, would I have caught it within that 24 hours or would I, how long would it have been before I caught, um, you know, money being out of my account and so forth. So it is important that you use credit monitoring services, whether it’s credit karma, you know, there’s a whole number, a whole host of them, um, that are available.
Speaker 2 42:50 But you really should be checking in on that periodically. I know a lot of credit card companies now even, um, allow or they provide you your like your credit score. And so if somebody gets your social security number and goes and applies for a car under or alone, uh, or some sort of a credit card and that hard inquiry will be reflected, you know, so that’s an indicator. You may look at your credit and go, my goodness, my credit score has gone down and I don’t, I don’t even know why I don’t have a new account here. Oh, it’s that hard inquiry. Well, wait a minute. I didn’t make, I didn’t make an inquiry. Um, so those things are really, really important for you to know.
Speaker 1 43:27 Speaking of which, so I’m going to tell you, um, your FICA score. Uh, by the way, there is a, there’s a, there’s a credit score for your business. Uh, and there’s a credit score for you personally correct. For four businesses, dun and Bradstreet, DNB, that is becoming even more prevalent. So you can actually, this is never too early for you to start your business credit, right? Um, large companies fully take advantage of it. Um, the difference is that one is guaranteed by the corporation and the other one is guaranteed by you, right? But what makes up the FICA score? Your payment history is 35%. Your credit utilization is actually 30%. Right? Um, your, the length of credit is only 15% not. Yeah, it’s all trusting, right?
Speaker 2 44:11 People think, Oh, I haven’t had credit for very long, or I can’t buy a house, or you know, something along that’s not true. New, new, they’re looking for new people in the market,
Speaker 1 44:19 right? So you can have, so then you credit is 10%. So if you’re, if you never really get any credit and you’re not, so they’re actually, you actually being rewarded by getting new credit, by managing, right, right. And then, and then as a credit mix, right? And that’s 10%. So the top two are 65% payment. History is everything. And it starts with your bookkeeping, you know, and, and, and, and you gotta do it. You gotta be on top of it. Nobody cares if you’re a sole proprietorship, an LLC, or you don’t have a lot of, um, um, anybody minding your bookkeeping, you should be able to do it yourself. But if your credit is shot you, you’re dead on arrival.
Speaker 2 45:07 Hey, I’ll tell you. And a lot of times people’s credit is shot just because they haven’t got good control over the bookkeeping. And it’s not that you don’t have the money, she just didn’t get the payment in on time. Well, you can’t afford to be neglectful when it comes to that kind of stuff. No. And absolutely. I would highly recommend that you put at least the minimum payment on auto, you know, payment, if that’s, if that’s your life. I know that’s a great point. Yeah. I know a lot of people particularly let’s say for example, the construction industry of folks who are not working in a regular, um, like office work environment. They’re out on the road and it gets very difficult to come home after work and then sit down and pay all your bills or you know, this and those types of things kind of end up falling through the cracks. So if, if that is, you know, know yourself best and understand that that’s the lifestyle you have and that’s the impediment that you made, maybe you have put your minimum payment on auto pay. So at least the minimum goes because the minimum is typically really pretty small. So those two interests. Yeah. And it’s fine, but that’s right.
Speaker 1 46:08 So here’s a good practical, and I’ve seen it in bigger companies, the ones that you’re able to have multiple um, high limit, you know, the American express, which is a great tool to when you’re doing a lot of traveling and you have a, say you have a B of a or Wells Fargo in a CD card and you know, you have for, well be careful. A lot of companies will say, we’ll give you this discount. If you give us a, a number of people that are medically give their debit card number to have an auto, be careful who you give access to, your think about their exposures. Something somebody gets a hold of that vendor and they fall into your debit card, falls into the wrong hands and you have $300,000 in your checking the business checking account and somebody compromises you have, you’re going to have a hard time getting that money back. This
Speaker 2 46:55 is a mistake I’ve made. Just don’t do that. Right? Yeah. And I’ll be honest with, with you and, and the folks listening, we have made a lot of mistakes in business and w we heard that’s what you are, what you are willing to make mistakes. Right. And we would like to maybe circumvent some of the decisions that we’ve made in bumps and bruises we’ve had in the past and and help people. Um, this is a mistake that I’ve made is attaching it to my bank debit card and not a credit card. And I highly, highly recommend if you are that person who does, um, put things on auto pay or auto renewal, whatever it is,
Speaker 1 47:30 use a credit card and not your bank debit card. So how you, how you gained the system to your advantage. Have all your credit cards beyond auto with you know, with you, with your back, but 90 all the other purchases, your product cards. Yeah. So what the world sees, it’s your credit cards, right? And behind the C is how you pay is with your bank account. That’s correct. And that’s how you gained the system and your fine. And, and I’ve seen it when he works, he works great. Um, if you have the ability and if you know, if boy, if you’re doing your cash management right, you should know where your cash position is six weeks from now. Sure you can anticipate this purchases. Anyways. So what else do we wanna um, uh, remind our listeners too. So if you have any legal matters, if you have a question, um, you know, I, I want to put it out there.
Speaker 1 48:20 I mean I’m sure to Claudia and if, if somebody has a question you within turn somebody away because they have a question. Um, you want them to come to you. If you are, if you’re a business owner or, or somebody who is dealing with multiple businesses, you want to opinion on anything coil and call Claudine’s office. What’s your office number? Our office is area code two, nine four two seven 2200. And again, we are now on Sanford Avenue here in Modesto. Come on. We are also in Turlock, so I’m, but you service clients in multiple places, right? We, you serve as a client in LA. Absolutely, yes. LA back then was, we were in LA three weeks ago, I think in long beach, down in long beach. And, and our associates are, um, we will travel. So it’s not just me, we have other associate attorneys in the office and they will travel and um, are just happier.
Speaker 1 49:07 Awesome to those. Oh that attorneys are awesome. Yes. Hooray. So anyway, so if you, if you really want quantitative analysis and you want to be the business, do you know the, the one that could become worth millions, then you need to talk to us. Yeah. And you can reach [email protected] or call our office five, five nine two Oh seven three one four eight. We are in for eczema. We serve as the entire state of California. Mighty ad is, it is. It’s right. So, Hey, I want to thank everybody for listening and this being a great time and I hope we will. The permission that we provided to you was valuable and we want to hear from you. Email us, call us anytime you have been listening to business and legal talk with Lee and Claudine. Thank you so long.
Speaker 0 49:54 .