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Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
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In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
Forget Growth for Growth’s Sake. Scale Your Company With Purpose!
Every business owner dreams of growth—the big contracts, the expanding team, the larger facility. Growth is exciting, but what happens when it outpaces your ability to sustain it? For small to mid-sized business owners, the challenge isn’t just getting bigger—it’s growing profitably. Scale too quickly, and you could find yourself losing control of your business. Scale too cautiously, and you risk stagnation. So, how do you strike the right balance?
The Growth Trap: A Cautionary Tale
Imagine you own a manufacturing company, and a massive order comes in. It’s a dream deal—10,000 units instead of the usual 1,000. You scramble to increase production, hiring new employees, ordering more materials, even taking on debt to finance the expansion. But a few months later, you realize you’re barely breaking even. The new employees aren’t fully trained yet, production costs have skyrocketed, and cash flow is tight. Your profit margins, which seemed healthy before, are now razor-thin. Worse, your suppliers have increased their prices due to the larger volume, but you didn’t adjust your pricing in time. You’re now operating at a loss, despite the influx of new business.
This scenario is all too common. Growth, if not managed wisely, can erode profits instead of increasing them. The key? Strategic scaling.
Profitability First, Expansion Second
In the early days, you might not be profitable, and that’s okay. Many businesses start in the red, investing in marketing, product development, and hiring. However, you must ensure you’re not losing money per product. If each unit costs $12 to make and you sell it for $10, no amount of scaling will save you—you’re just multiplying losses.
Similarly, new employees take time to become profitable. Hiring is an investment in growth, but it often takes months before an employee generates more revenue than they cost. Business owners must anticipate this ramp-up period and avoid over-hiring too soon.
Where to Focus Your Growth
Not all growth is created equal. The most efficient areas of expansion are those where costs scale more slowly than revenue. Prioritize these strategies:
Controlled Growth vs. Losing Control
Growth is exhilarating, but it must be controlled. Many business owners get so caught up in expansion that they give up too much equity, bringing in investors who eventually take control. Others overextend, running out of cash when things don’t go as planned.
Instead, keep growth sustainable:
Avoid Growth for Growth’s Sake
It’s easy to get caught up in vanity metrics—chasing higher sales, expanding into new markets, or acquiring more customers—without asking whether that growth actually benefits the business. But growth is not a goal in itself; it should be a means to an end. Every expansion initiative should answer a fundamental question: Will this make my business stronger in the long run? If the answer isn’t clear, it may be a sign to reassess.
Strategic growth means planning ahead. Before you leap, have a roadmap. Set clear, measurable goals, such as: “We aim to increase production by 50% over the next 18 months, which should yield a 20% revenue increase while maintaining a 15% profit margin.” This approach ensures that growth aligns with financial health, rather than just inflating top-line revenue while squeezing profits.
Smart business owners don’t just chase expansion; they balance growth with profitability. They scale strategically, ensuring each step forward is sustainable, and never lose sight of their core business strengths. With a steady hand, you can grow your company without losing control of it—and that’s the real measure of success.
This is the first of a new series of fictional case study articles. The business principles are applicable to all industries, not just the industry mentioned below.
Mike had spent years building his commercial construction company from the ground up. He took pride in his work, bidding on high-profile projects and assembling what he thought was a solid team. But as his company grew, so did his hiring challenges—especially when it came to leadership positions.
One project in particular—a multi-million dollar office complex—pushed his business to the edge. Under pressure to meet deadlines, Mike rushed to hire a new project manager, Tom, who came with an impressive résumé and glowing recommendations. But within weeks, cracks began to show.
Tom cut corners, ordered cheaper materials to save costs (without approval), and ignored safety protocols. Worse, he treated crew members poorly, causing skilled workers to quit mid-project. By the time Mike caught on, the damage was done. The project was behind schedule, client trust had eroded, and fixing Tom’s mistakes cost the company thousands.
Determined not to repeat the mistake, Mike changed his hiring approach. He thoroughly vetted new hires, conducted trial periods for leadership roles, and built a workplace culture that rewarded integrity and reliability. Within a year, his company had a team of dedicated leaders who took pride in their work—and it showed in their projects.
For businesses like Mike’s, hiring the right leadership isn’t just about filling roles—it’s about protecting the company's reputation, profitability, and long-term success.
A business can only succeed if its leadership is competent, ethical, and aligned with company values. A poor leadership hire can derail entire teams, weaken morale, and ultimately cost the company in lost productivity and damaged relationships.
The problem isn’t just finding someone with the right credentials. Many executives, managers, and directors look great on paper but fail to lead effectively. Worse, some take advantage of their positions, making decisions that benefit themselves at the expense of the company.
Avoiding these pitfalls requires a thoughtful hiring strategy that goes beyond skills and experience to assess character, leadership style, and long-term commitment.
When hiring for leadership roles, businesses should focus on finding ethical, capable, and accountable individuals. Here’s how:
Even the best leadership hire won’t stick around if they feel undervalued or unsupported. To keep strong leaders, businesses should:
Hiring and retaining the right leaders is just as critical—if not more so—than hiring the right employees. Leaders set the tone for company culture, influence productivity, and ultimately determine business success.
If your company has struggled with hiring leadership roles, it’s time to refine your hiring process, emphasize integrity, and invest in leadership development. By learning from mistakes—like Mike did—and implementing better hiring and retention practices, businesses can build a team of strong, ethical leaders who drive long-term success.
For more pratical information on hiring for a leadership position, check out this recent episode of the Expandable Show. https://www.youtube.com/watch?v=NtRezs5v4oA
Cash flow is the lifeblood of any business. Whether you're managing a commercial construction firm or running a retail operation, understanding how money moves in and out of your business is key to long-term success. Poor cash flow management can leave businesses scrambling to cover expenses, even when profits look good on paper.
A recent episode of the Expandable Series discussed this in detail, but here are some fundamental cash flow principles, using commercial construction as an example, that apply to businesses across all industries.
1. Understand Your Cash Outflows
In commercial construction, significant cash outlays are required upfront for raw materials, permits, and labor. These costs must be covered well before payments from clients arrive. Similarly, in retail, manufacturers need to purchase inventory long before customers make a purchase.
A business must have enough cash on hand to cover these expenses. Without it, operations may stall, delaying projects and impacting profitability. Understanding your cash needs ahead of time ensures smoother financial management.
Example: Imagine a mid-sized construction firm, Apex Builders, takes on a new commercial office project. Before the first payment arrives, they must pay for steel beams, concrete, and skilled labor. Without proper cash reserves or a well-structured payment schedule, Apex Builders could struggle to cover these costs, potentially halting the project and damaging their reputation.
2. Time Your Cash Inflows Strategically
Revenue in commercial construction typically comes from milestone payments throughout a project or upon completion. However, these payments can be delayed due to contract terms, client approvals, or unexpected issues.
For any business, it’s essential to analyze how long it takes to convert expenses into revenue. Are you waiting 30, 60, or even 90 days to get paid? If so, your business must be structured to withstand these gaps. Ensuring that your contract terms align with your cash flow needs can prevent unnecessary financial strain.
Example: Apex Builders structures their contracts to ensure payments are received at key milestones—such as after the foundation is laid, after framing is completed, and upon final inspection. By planning these payment intervals, they reduce financial stress and ensure they always have working capital.
3. Build a Cash Buffer
One of the best strategies for managing cash flow is to build a buffer that accounts for timing discrepancies. In construction, this means having enough reserves to cover payroll and material costs while waiting for payments. The same principle applies to any business with delayed payments.
This buffer should be built into your pricing. Instead of operating on razor-thin margins, factor in potential delays and unexpected costs when setting your rates. This ensures financial stability even during slower payment periods.
Example: Apex Builders includes a 10% contingency in their project bids, ensuring that if a client delays payment or unexpected costs arise, they have the liquidity to keep operations running smoothly.
4. Plan for Payroll and Fixed Expenses
Payroll is a non-negotiable expense in any business. Employees expect timely paychecks, and failure to meet payroll obligations can lead to operational disruptions and even legal consequences.
Since payroll and other fixed expenses (like rent, utilities, and insurance) don’t change based on revenue fluctuations, they must be accounted for in advance. Forecasting these expenses over the next quarter will help ensure you always have the necessary funds available.
Example: Apex Builders schedules payments from previous projects to help cover payroll during slow months, ensuring that employees are always paid on time.
5. Look Ahead to the Next Quarter
Successful businesses don’t just think about today’s cash flow—they plan for the next quarter and beyond. What projects are in the pipeline? When will revenue from those projects be realized? What expenses need to be covered in the meantime?
By forecasting cash flow and preparing for potential shortfalls, businesses can make informed decisions about when to invest, when to hold back, and when to seek additional financing options to bridge any gaps.
Example: Apex Builders maintain a rolling cash flow projection, helping them anticipate slow periods and ensuring they never take on more projects than they can financially support at one time.
The Bottom Line
Cash flow management isn’t just about tracking numbers—it’s about planning ahead, building flexibility into your pricing, and ensuring your business can withstand the natural ebbs and flows of financial cycles. Whether you’re in commercial construction, retail, or any other industry, mastering cash flow is essential for long-term success. Surety Bank is here to help businesses navigate these challenges with financial solutions designed to keep operations running smoothly.
In the spring of 1994, Cindy walked into Surety Bank—not to apply for a job, but to apply for a mortgage. She and her family had recently moved from Michigan, and Surety was simply the place she trusted to help them settle into their new home. What she didn’t expect was that the bank would also offer her something even more life-changing—a career that would span more than three decades.
“I didn’t have to look very hard for a job,” Cindy recalls with a laugh. “They saw that I had banking experience and called me up because they needed a teller.”
It was the start of a journey that would see Cindy grow from a front-line teller to a key part of the bank’s payroll and HR team. Over the years, she became a steady presence in the bank’s evolving landscape, witnessing firsthand how technology transformed the industry. When she first started, many processes were still manual—checks were physically run through proof machines, reconciliations were done by hand, and not everyone even had a computer at their desk.
“I remember when we had to share computers,” she says. “That didn’t last too long, but things were a lot different back then.”
Cindy’s career path took her from teller to bookkeeping, then into accounting, and eventually into payroll and HR, where she found her niche. She describes her work as being part of a team that always pulled together to solve challenges—a culture of collaboration and adaptability that made Surety Bank feel like home.
“We always worked together to find solutions,” Cindy reflects. “Even though my role became more specialized over the years, it was always about teamwork.”
For Cindy, working at Surety Bank wasn’t just about the job—it was about the life it allowed her to build. Living just three miles from the bank, she was able to balance her career while staying closely involved in raising her children, supporting her husband, and nurturing her faith.
“I’ve been able to have my life at home and my life here at work,” she says. “It’s been a blessing to have a career that allowed me to be present for the things that mattered most—my family, my husband, and my faith.”
As much as she dedicated herself to her work, Cindy never lost sight of what was most important. She is deeply grateful that her time at Surety allowed her to grow professionally while still prioritizing the people she loved.
Looking back, Cindy remembers the many friendships, the changes that brought new ideas, and the way she adapted alongside the bank. Perhaps most of all, she values the relationships she built—with colleagues who became like family and customers who left a lasting impression.
Now, as she steps into retirement, Cindy is ready for a new chapter—one that revolves around her grandchildren, travel, and time with family in Michigan. It’s a bittersweet transition, but one that feels right.
“I never dreamed I’d be working someplace for 31 years,” she admits. “But as it turns out, it really went by fast.”
For those just starting their careers in banking, Cindy offers a simple but powerful piece of advice: “Be open to learning all aspects of the job. Take your time, think things through, and just go with the flow.”
After 31 years of steady dedication, Cindy leaves behind a legacy of resilience, kindness, and adaptability—a perfect reflection of the values that make Surety Bank so special. While she may be stepping away from her desk, the impact she’s made at Surety Bank will remain for years to come.
Thank you, Cindy, for 31 incredible years. Your Surety Bank family will miss you!
Durable Medical Equipment (DME) is defined as any medical equipment used in the home to aid in a better quality of living. The term includes wheelchairs, knee braces, hospital beds, nebulizers, walkers, etc. DME is a benefit included in most insurances including Medicare Part B which covers medically necessary DME that is prescribed by a physician for use in a patient’s home.
According to an AARP Bulletin titled “Medicare Under Assault From Fraudsters”, “roughly 10 cents of every dollar budgeted for the giant health insurance program is stolen or misdirected before it helps any enrollee. Malcom Sparrow, a Harvard University professor and leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.” See below a graphic that puts the scale of Medicare fraud into perspective.
As you can see, DME fraud has become a huge business for criminals, and they are increasingly using MSBs to provide illegal kickbacks to physicians, launder their illegal proceeds, and take advantage of fraud victims. This behavior should disgust any American taxpayer, if not morally, think about how much of our hard-earned money over the years goes straight into these fraudsters’ pockets.
How it works:
See below an excerpt from a February 4, 2021, Department of Justice Press release titled “Florida Businesswoman Pleads Guilty to Criminal Health Care and Tax Fraud Charges and Agrees to $20.3 Million Civil False Claims Act Settlement”
[According to court documents, Wolfe and her conspirators used Regency to establish dozens of DME supply companies — or, rather, DME fronts — using trickery and deception. The scheme involved placing the DME fronts in the names of straw owners. By concealing the true ownership, Wolfe’s conspirators secretly gained control of multiple companies. With such control, they collectively submitted well over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. The conspirators claimed that the unusually high volume of claims reflected the use of telemedicine procedures, when, in fact, they had simply bribed doctors to approve them. Almost always, the doctors had no telehealth interaction with the beneficiaries.]
As you can see Wolfe established multiple shell companies and submitted over $400 million in illegal DME claims to Medicare and the Civilian Health and Medical Program of the VA. Another crucial element of the scheme is she bribed doctors to approve these fraudulent invoices stating they conducted telehealth services for the beneficiaries. The illegal kickbacks to doctors is what check cashing MSBs will encounter. A pattern we have picked up on is checks from companies with “Medical Equipment, DME, Braces, Devices, etc.” made payable to individuals that turn out to be physicians or money mules are likely illegal kickbacks to doctors for signing off on fraudulent DME claims.
Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b)]
The AKS is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients). Remuneration includes anything of value and can take many forms besides cash, such as free rent, expensive hotel stays and meals, and excessive compensation for medical directorships or consultancies. In some industries, it is acceptable to reward those who refer business to you. However, in the Federal health care programs, paying for referrals is a crime. The statute covers the payers of kickbacks-those who offer or pay remuneration- as well as the recipients of kickbacks-those who solicit or receive remuneration. Each party’s intent is a key element of their liability under the AKS.
Criminal penalties and administrative sanctions for violating the AKS include fines, jail terms, and exclusion from participation in the Federal health care programs. Under the CMPL, physicians who pay or accept kickbacks also face penalties of up to $50,000 per kickback plus three times the amount of the remuneration.
Other Examples:
Red flags we have identified relating to DME fraud kickbacks are as follows:
• Maker names related to medical equipment writing checks out to individuals. The dollar amount can be random, but we see a lot in the $2,000 – $9,000 range. Less sophisticated actors will structure these payments to remain under the $10,000 CTR threshold.
• When you look up the registered agents of these DME companies on publicly available databases such as Sunbiz.org in Florida, they often control several other companies related to medical equipment that have been recently established. This is indicative of shell companies just like we saw in the above example from the DOJ press release.
• A payee that comes into the check cashing store and regularly cashes checks made payable from DME related companies. You may want to conduct and internet search of these individuals and determine if they are a physician.
What to do if you suspect DME fraudsters are taking advantage of your business to facilitate payments?
If you suspect a potential customer or customer is involved in DME fraud you should investigate to determine if any of the above red flags are involved. As always, you should ask yourself does this activity make sense given the nature of the alleged business? If you determine an existing customer is involved in DME fraud and has conducted transactions aggregating over the SAR dollar volume threshold, file a SAR. As always if you suspect a customer is involved in illegal activity you need to block them from doing business with you. No matter how profitable the relationship is, it’s not worth being fined, losing your license, or ending up in a Department of Justice press release.
Sources:
https://www.aarp.org/money/scams-fraud/info-2018/medicare-scams-fraud-identity-theft.html
https://oig.hhs.gov/compliance/physician-education/01laws.asp
Better Monitoring
Per federal and state guidelines, MSBs are required to monitor their customers’ transactions for suspicious and illegal activity.
Over the past year and a half, the Federal and State governments have issued a huge amount of money to individuals and businesses in the form of Covid-19 stimulus packages. Criminals have been exploiting this situation by committing financial crimes at an unprecedented rate. See a few examples below.
“IRVINE, Calif. (KABC) — An Irvine man allegedly obtained about $5 million in federal coronavirus-relief loans for his fake businesses and then spent the funds on himself, including buying Ferrari, Bentley and Lamborghini sports cars, according to federal authorities.”
“BOSTON — The owner of a Massachusetts pizza parlor lied about the number of employees he had to fraudulently obtain more than $660,000 in federal coronavirus relief funds, then used some of the money to buy and stock an alpaca farm in Vermont, federal prosecutors said Tuesday.”
“According to the report by the Times, Abidemi Rufai, of Lekki, Nigeria, was charged Saturday in federal court with using the identities of more than 100 Washington residents to steal more than $350,000 in unemployment benefits from the Washington state Employment Security Department (ESD) during the COVID-19 pandemic last year.”
How can you improve your quality of monitoring?
Here are some tips on how to get better:
Better Reporting
Reporting should be a natural extension of your monitoring practices. If you are making your monitoring a high priority, good reporting will naturally flow from those activities.
It is very important to file CTRs on a timely basis, within 15 days.
If you are using your check cashing software fully, it will help with the practice of reporting. Especially with CTRs, when a suspicious activity is identified, your software will trigger a CTR. In addition, it will aggregate the data on a customer, pulling all their transactions together if they have made multiple transactions at different times of the day.
Investing in additional features like these and learning how to use them minimizes mistakes.
For example, if a customer comes in three separate times during a day and cashes a $5,000 check each time, will your employees know to aggregate all of those transactions? If not, this is where the software can minimize mistakes.
We understand that your team is most likely not trying to intentionally ignore possible suspicious activity. However, if they get busy and are rushed, without these extra measures in place to catch mistakes they are more likely to make a human error that could cost you.
Our Commitment to You
One of our highest priorities and commitments to you is to make sure our BSA staff is highly qualified and properly trained.
As we seek to be a resource for you, we hold ourselves to the highest standard as well. We are in the business of compliance, so we take employee training, monitoring, and reporting very seriously.
If you have questions for our team and would like to connect, you can reach us here.
RESOURCES
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