<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
CREDIT MANAGEMENT SOLUTIONS, INC.
---------------------------------
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
----------------------------
(Title of Class of Securities)
224905109
---------
(CUSIP Number)
K. Tucker Andersen
Cumberland Associates LLC
1114 Avenue of the Americas
New York, New York 10036
(212) 536-9700
---------------------------------------
(Name, Address and Telephone Number
of Person Authorized to Receive Notices
and Communications)
January 29, 1998
-------------------------------------
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
<PAGE>
SCHEDULE 13D
CUSIP No. 224905109
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CUMBERLAND ASSOCIATES LLC
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[X]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
WC,00
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
7. SOLE VOTING POWER
396,500
NUMBER OF 8. SHARED VOTING POWER
SHARES
BENEFICIALLY 80,500
OWNED BY
EACH 9. SOLE DISPOSITIVE POWER
REPORTING
PERSON 396,500
WITH
10. SHARED DISPOSITIVE POWER
80,500
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
477,000
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.3%
14. TYPE OF REPORTING PERSON*
OO, IA
2
<PAGE>
Item 1. Security and Issuer.
This statement relates to the common stock, $.01 par value per
share (the "Common Stock" or the "Shares"), of Credit Management Solutions, Inc.
(the "Company"), which has its principal executive offices at 5950 Symphony
Woods Road, Columbia, Maryland 21044.
Item 2. Identity and Background.
This statement is being filed by Cumberland Associates LLC.
Cumberland Associates LLC is a limited liability company organized under the
laws of the State of New York, and is engaged in the business of managing, on a
discretionary basis, twelve securities accounts, the principal one of which is
Cumberland Partners. The address of the principal business and office of
Cumberland Associates LLC is 1114 Avenue of the Americas, New York, New York
10036.
K. Tucker Andersen, Gary Tynes, Oscar S. Schafer, Bruce G.
Wilcox, Glenn Krevlin, Andrew Wallach and Eleanor Poppe are the members (the
"Members") of Cumberland Associates LLC. The business address of each of the
Members is the same as that of Cumberland Associates LLC. Each of the Members is
a citizen of the United States.
Neither Cumberland Associates LLC nor any of the Members have,
during the last five years, been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors), nor has any such person, during the
last five years, been a party to a civil proceeding of a judicial or
3
<PAGE>
administrative body of competent jurisdiction as a result of which any such
person was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
As of the date hereof, Cumberland Associates LLC held and
beneficially owned 477,000 shares of Common Stock. The aggregate purchase price
of the Common Stock purchased by Cumberland Associates LLC on behalf of
Cumberland Partners, LongView Partners, LongView B, LongView C and the other
managed accounts was $4,777,124. Of this amount, Cumberland Associates LLC
invested approximately $2,839,609 on behalf of Cumberland Partners, $679,765 on
behalf of LongView Partners, $319,375 on behalf of LongView B, $102,063 on
behalf of LongView C and $836,312 on behalf of eight of Cumberland Associates
LLC's other account holders. The source of funds for the purchase of all such
Common Stock of Cumberland Associates LLC was a combination of investment
capital contributed by Cumberland Partners, LongView Partners, LongView B,
LongView C and the eight other managed accounts and margin borrowings through
the margin accounts of the account holders maintained with Morgan Stanley & Co.
Incorporated.
By virtue of Rule 13d-3 under the Exchange Act, each of the
Members may be deemed the beneficial owner of all of the Common Stock purchased
by Cumberland Associates LLC on behalf of
4
<PAGE>
Cumberland Partners, LongView Partners, LongView B, LongView C and the other
managed accounts, and therefore each Member may be deemed to have invested the
aggregate amount of funds noted above. None of the Members has independently
invested any of his or her funds for the purpose of purchasing the Common Stock.
Item 4. Purpose of Transaction.
Cumberland Associates LLC has purchased, on behalf of its
discretionary accounts, the Common Stock in order to acquire an equity interest
in the Company. As of the date hereof, Cumberland Associates LLC is holding such
Common Stock solely for investment and it has no present plans or proposals with
respect to any material change in the Company's business or corporate structure
or, generally, any other action referred to in instructions (a) through (j) of
Item 4 of the form of Schedule 13D. Depending on market conditions and other
factors, Cumberland Associates LLC may continue purchases of Common Stock or may
sell or otherwise dispose of all or portions of such Common Stock, if such sales
and purchases would be desirable investments for the portfolios of its accounts.
5
<PAGE>
Item 5. Interest in Securities of the Issuer.
As of the date hereof, Cumberland Associates LLC beneficially
owned 477,000(1) shares of Common Stock representing 6.3%(2) of the Common Stock
deemed outstanding on the date hereof.
Set forth in Appendix A attached hereto and incorporated herein
by reference are descriptions of the transactions in the Common Stock effected
by Cumberland Associates LLC within the 60 day period prior to the date of this
filing.
In addition, each of the Members may, by virtue of his position
as a member of Cumberland Associates LLC, be deemed, pursuant to Rule 13d-3
under the Act, to own beneficially the Common Stock of which Cumberland
Associates LLC would possess beneficial ownership. Other than in their
respective capacities as members of Cumberland Associates LLC and except as set
forth above, none of the Members is the beneficial owner of any Common Stock.
- ---------------
(1) As to 396,500 Shares of which, there is sole voting power and sole power
to dispose or to direct the disposition of such Shares; as to 80,500
Shares of which, there is shared voting power and shared power to
dispose or to direct the disposition of such Shares because the eight
other account holders may be deemed beneficial owners of such Shares
pursuant to Rule 13d-3 under the Act as a result of their right to
terminate their discretionary accounts within a period of 60 days.
(2) Based on 7,615,510 shares of Common Stock outstanding, as indicated in
the Company's Form 10-Q for the quarterly period ended September 30,
1997, as filed with the Securities and Exchange Commission.
6
<PAGE>
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
Pursuant to management agreements with all of its accounts except
Cumberland Partners, LongView Partners, LongView B and LongView C, Cumberland
Associates LLC receives (i) an annual management fee from some of its account
holders and (ii) an incentive fee from all of its account holders based, in the
case of some of the account holders, on the net appreciation during the
preceding fiscal or calendar year in the value of the securities in the account
and, in the case of other account holders, on the account's taxable income
during the preceding fiscal or calendar year. In the case of the accounts of
Cumberland Partners, LongView Partners, LongView B and LongView C, Cumberland
Associates LLC receives an annual management fee from each such account holders
which does not include an incentive fee.
Except as otherwise set forth in this statement, to the best
knowledge of the undersigned, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) among or between the
undersigned, the Members and any other person with respect to any securities of
the Company, including but not limited to transfer or voting of any of the
securities, finder's fees, joint ventures, loan or option arrangements, puts or
calls, guarantees of profits, division of profits or loss, or the giving or
withholding of proxies.
7
<PAGE>
Item 7. Material to be Filed as Exhibits.
No Exhibits are filed herewith.
After reasonable inquiry and to the best knowledge and belief of
the undersigned, the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: February 6, 1998
CUMBERLAND ASSOCIATES LLC
By: /s/ K. Tucker Andersen
K. Tucker Andersen
Member
8
<PAGE>
APPENDIX A*
1. TRANSACTIONS EFFECTED BY CUMBERLAND ASSOCIATES LLC
DATE OF NO. OF UNITS NO. OF UNITS PRICE PER
TRANSACTION PURCHASED SOLD UNIT
----------- ------------ ------------ ---------
2/4/98 45,000 $7-3/8
1/29/98 80,000 $8-7/8
- ---------------
* Each of the transactions set forth in this Appendix was a
regular way transaction.
