Sunday, September 04, 2011

What to do when your money is on the line?

It's Saturday afternoon, and I receive an email request from a professional acquaintance who directs an English program at an Indonesian university. I'd already heard that he was coming to Singapore for a professional visit with nearly 30 teachers from various Indonesian universities. I'd also heard that he'd made reservations for his group at a local budget hotel. What I didn't expect was what he would ask me to do.

He was in panic mode. According to his missive, he had not been able to secure his reservation because he didn't have a credit card, and the visit was just two weeks away. His request was this: Would I be willing to use my credit card to secure the reservation and pay up front for 15 hotel rooms? The tab would be in the thousands of dollars, but he assured me (and I believed him) that as soon as he received the bill from me he would have the money wired to my account.

Generally, I would not have even considered getting involved. But the fellow making the request was a person who had helped organize for me a workshop tour of various Indon universities. He had also invited me to do a presentation skills workshop at his school. In addition, he had made it possible for me to get a book chapter published, and we had also collaborated in project work. In a very real sense, I owed him.

At the same time, I was wary of putting so much cash up front. What would happen if something went awry? I really wanted to avoid a situation that tested our professional friendship.

So how to avoid a conflict in this situation?


EricLeeJiaYuan said...

I usually don't lend money to people I don't know very well. I will politely decline, saying " I'm sorry, but as a rule, i don't lend money to friends."With very close friends, you would think i would be less of a scrooge. In actual fact,I am less willing to be a "friend bank".

One of the best pieces of advice that i have ever received: Allowing a friend to borrow your money is not the best way to help your friend.Till today,I follow that advice to the latter. In fact, it usually takes even more effort to help a friend some other way.

In your case, i would usually tell that friend "Hey, i only have a debit card and i don't think i have sufficient money in that bank account because it is not connected to my main account.But if you want i can facilitate your booking for you by loaning you the use of my debit account,just need you to $XXX (make a safe estimation) to my account. I'll take care of the rest"

Yes, i know that's a white lie, but sometimes the truth may not be the best answer.

Eric said...

*just need you to transfer $XXX

$ W?h0w $ said...

How about asking for a partial deposit via telegraphic transfer / bank draft? DBS, OCBC, HSBC, UOB have branches in both Indonesia and Singapore.

Anonymous said...
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Ai Lin said...

I think you should sign an agreement letter with him. Even though you are very grateful for the things that he offered you in the past(eg publishing a chapter in a book), but you cannot just lend him the money to show your gratitude towards him. Yes you can lend him the money but let him know that despite the friendship, agreement must be signed.

Bernard Lim said...

Hi Brad,

I guessed it's always a tricky situation when large amounts of cash are involved, especially when it's not a close friend.

In your scenario, I would suggest that you request a quotation from the hotel, send the quotation to your friend and suggest that he wires the amount to your account before you perform the reservations. This way you avoid putting the large amount of cash up front, but will still be able to do your friend the favour.

It would be wise to express your honest concerns to your friend too. After all it is a sizeable sum of money. As a fellow professional, I believe he will understand the cause of your concerns. With your assurance that his money is in safe hands, I'm sure he would not object to this solution. (:

Png Ning said...

Money is a very sensitive issue, especially when someone you know well is involved in it. I don't think I would lend him the money if I feel uncomfortable about it. I would propose another solution and tell him that there is another way to solve this problem. I thought the idea of telegraphic transfer is excellent. If needed, you may offer to help him facilitate the payment to the hotel once he has sent you the money. Given your close relationship with him, he should be able to trust you to pay the hotel when you receive the money.

I don't think that telling him a white lie, as Eric calls it, is necessary in this case. It doesn't sound convincing enough for me and I wouldn't want to jeopardize a relationship with someone, especially whom I might be working closely again in the future by telling a lie. It just doesn't seem right.

noelle said...

This really sounds like a tricky situation as Bernard has mentioned..

Personally, given what I know of him in the past/in previous experiences, I would have already decided whether he is trustworthy or not. And if he has proved it, I believe I would go ahead with his request, even if it involved a large sum of money.

There's a fine line between being wise (to politely decline his request/find another option for him) or naive (to agree to it readily), but I guess it boils down to what your own values are.

Though if the outcome really went awry, the next time I encounter such situations I would definitely be much more wary. After all, "once bitten, twice shy"!

Brad Blackstone said...
This comment has been removed by the author.
Brad Blackstone said...

Thanks to everyone for reading this post and considering the problem. Your comments are very insightful, and range from not loaning to loaning with conditions.

What I actually did was go online to try and solve the issue. I managed to find a website that would allow me to book the rooms at the hotel of his choice (and others, which were cheaper) with my credit card as a mere means of securing the place, but without that same card being required for pre-payment.

In short, through, I was able to book 15 rooms at a reasonable rate that could be paid for in cash by my friend when he checked out later. It was a win-win solution for me and him. He gets his rooms, and I do the booking without having to pay.

So far so good.

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