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Elite Recovery Services, a Buffalo, N.Y.-based collection agency and credit card debt buyer, closed suddenly late last week, citing cash flow problems. The company, which laid off all 73 employees without offering severance pay or any other benefits, did not file for bankruptcy protection. Instead, management is talking with an unidentified third party in hopes of saving the company. Details on those negotiations were unavailable because of confidentiality agreements. Elite Recovery is the second Buffalo-based collection agency to shut down abruptly in recent weeks, following First American Recovery Services' Chapter 11 bankruptcy filing in November. First American blamed its closure on a slowdown in payments from consumers and the decision by its lender to shut off a credit line. Elite Recovery officials stated simply the company's expenses are higher than its revenues, but the company ultimately hopes to provide severance packages, according to Richard Corica, company president and CEO. Elite Recovery manages more than 650,000 accounts, primarily bankcard and private-label card accounts. It also manages consumer loans and auto deficiencies. The total account face value is more than $1.2 billion.
