Morse
& Morse, PLLC
1400
Old Country Road, Suite 302
Westbury,
NY 11590
Tel:
516-487-1446
Fax:
516-487-1452
Email:
morgold@aol.com
[Portions
of this response have been omitted and separately submitted to the SEC with
a
request for confidential treatment under Rule 83. The location of those
omissions have been noted by [**].
Paul Fischer,
Staff Attorney Division
of Corporation Finance July
18,
2007
Telephone
Number: 202-551-3415
Facsimile
Number. 202-7729205
Mail
Stop 3720
Re: Anchor
Funding Services, Inc.
Registration
Statement on Form 10-SB/A No. 1
Filed
on
July 3, 2007
File
No.
0-52589
Dear
Mr.
Fischer:
As
counsel to the above captioned corporation, the following letter is in response
to comment no. 2 to the Staff’s comment letter with respect to Anchor
Funding Services, Inc.’s Form 10-SB/A Registration Statement. We have both
electronically filed this response letter and have provided you with hard copy
to your mail stop via overnight courier.
2.
Comment
In
your
response to prior comment 18 of our letter dated May 25, 2007, you state that
you complied with our comment. We are unable to locate the disclosure requested
in the first part of the comment in the two sections of the document that you
reference. We also note that you did not tell us whether any other clients
represented 10% or more of your accounts receivable portfolio. Please advise.
Response
As
of
June 30, 2007, Anchor’s accounts receivable portfolio totaled $1,107,181. Of the
1,107,181, $276,049 or 24.9% are accounts receivable of [**1], a staffing
corporation located in New Jersey; $205,551 or 18.5% are accounts receivable
of
[**2], a medical staffing company located in New York; $184,927 or 16.7% are
accounts receivable of [**3], an intellectual technology consulting company
located in Maryland; and $155,424 or 14% are accounts receivable of [**4]
another medical staffing corporation located in New York. We propose to amend
the Management’s Discussion under Client Accounts to read as
follows:
[**]
- Confidential or proprietary information redacted.
Paul Fischer,
Staff Attorney Division
of Corporation Finance
July
18,
2007
Page
2
[Portions
of this response have been omitted and separately submitted to the SEC with
a
request for confidential treatment under Rule 83. The location of those
omissions have been noted by [**].
“Client
Accounts
As
of
June 30, 2007, we have four clients that each account for at least 10% of our
accounts receivable portfolio. This includes a staffing company located in
New
Jersey, which accounts for 24.9% of our accounts receivable portfolio, a medical
staffing corporation located in New York, which accounts for 18.5% of our
accounts receivable portfolio, a second medical staffing corporation located
in
New York, which accounts for 14.0% of our accounts receivable portfolio and
an
intellectual technology consulting firm located in Maryland, which accounts
for
16.7% of our accounts receivable portfolio. These four clients, as of June
30,
2007, account for 74.1% of our total accounts receivable portfolio. A client’s
fraud could cause us to suffer material losses.”
We
also
propose to amend the relevant risk factor to read as follows:
“A
client’s fraud could cause us to suffer material losses. A
client
could defraud us by, among other things:
· directing
the proceeds of collections of its accounts receivable to bank accounts other
than
our
established lockboxes;
· failing
to accurately record accounts receivable aging;
· overstating
or falsifying records showing accounts receivable or
inventory; or
· providing
inaccurate reporting of other financial information.
As
of
June 30, 2007, we have four clients that each account for at least 10% of our
accounts receivable portfolio. This includes a staffing company located in
New
Jersey, which accounts for 24.9% of our accounts receivable portfolio, a medical
staffing corporation located in New York, which accounts for 18.5% of our
accounts receivable portfolio, a second medical staffing corporation located
in
New York, which accounts for 14.0% of our accounts receivable portfolio and
an
intellectual technology consulting firm located in Maryland, which accounts
for
16.7% of our accounts receivable portfolio. These four clients, as of June
30,
2007, account for 74.1% of our total accounts receivable portfolio. A client’s
fraud could cause us to suffer material losses.”
We
are
writing this letter to you in anticipation of our filing Amendment No. 2 within
a few business days. It is our contention that the foregoing disclosures in
response to comment no. 2 should satisfy your concerns with respect to
identifying any client that accounts for more than 10% of the total outstanding
accounts receivable without actually naming the companies. Anchor’s Management
believes that to provide the specific names of its four largest clients could
materially damage its business as its competitors could access these public
filings, obtain their names and seek to provide the same services to them at
potentially a lower cost. We submit to the Staff that the actual names are
meaningless to the public, that more than likely have never been heard of by
the
Staff, and are only
[**]
- Confidential or proprietary information redacted.
Paul Fischer,
Staff Attorney Division
of Corporation Finance
July
18,
2007
Page
3
[Portions
of this response have been omitted and separately submitted to the SEC with
a
request for confidential treatment under Rule 83. The location of those
omissions have been noted by [**].
relevant
information to our competitors. We believe that we have provided sufficient
information in substitution of the respective names so that the reader knows
the
industry of concentration and the general location of the respective clients,
without putting Anchor at a competitive disadvantage as almost all the 2000
small business companies that it competes with are privately held companies
that
are not required to divulge the names of their principal clients to their
competitors.
We
would
appreciate hearing from the Staff as to its position on our intended response
before we file Amendment No. 2. Kindly note that the information we gave in
Amendment No. 1 was client information given as of June 24, 2007 and it was
not
the correct information as of the date specified therein.
|
Very truly yours,
MORSE & MORSE, PLLC
|
||
| |
|
|
| By: | /s/ Steven Morse | |
|
Steven Morse, Managing Member |
||
[**]
- Confidential or proprietary information redacted.