More on Internet appraisal ‘scams’

BVWireIssue #57-3
June 20, 2007

In response to our recent item on “Bogus BV sites” (BVWire #  57-1), Chuck Engle CPA/ABV/CBI writes “that these inexpensive appraisals are not targeted at our client base.  Many business brokers recommend an independent appraisal to aid in setting price expectations for many ‘Main Street’ (mom and pop) businesses.  It may be that the $399 appraisals are targeted to this market and perform a service.”  And while “I do agree that there is plenty of room for misunderstanding, it would be great if we could have a term for what we do in valuation…that could only be used by accredited valuators.”

We agree on both points: Legitimate sites may perform a viable service to help price small, family-owned businesses.  However, their use of appraisal terminology—and false or exaggerated credentials—cast a confusing if not tarnishing shadow on the entire business valuation profession.  For example, we still have not heard back from either of two sites professing to use the “CSBA” credential from the “Association of Certified Small Business Appraisers” (ASCBA).  But we DID learn that the owner of Arrow Appraisers, Robert Malt, lists on his sample Summary Appraisal that he is “Founder and President of the…ASCBA.”  Moreover, the “Certification” specifies:

My analyses, opinion and conclusions were developed, and this report has been prepared, in conformity with appraisal guidelines endorsed by the Association of Certified Small Business Appraisers (ACSBA) and other widely accepted and recognized valuation methods.

Another site professing to produce “CSBA-certified” appraisals: Biz Specialists.  Once again, though the services they provide may be legitimate, the so-far unsubstantiated credentialing is misleading to consumers (at best) and damaging to the legitimate, hard-working practitioners in the BV profession.

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