Legal Question in Credit and Debt Law in Massachusetts
credit card debt and collections
I owed a small business and opened a credit card with American Express, at the time they asked if I wanted to add a second card, I did, and had the name on it in an employees name. I did not give any personal information on this employee, just their name on the card so they could pick things up if I was tied up. I had to close the business, and the account is now in collections. Couple of questions, can they go after the employee for the debt? If I sent certified notice to the collection agency asking that all future contact be made via mail, are they in violation calling me and/or my realitives looking for me? my original plan was to bite the bullet and file for bankruptcy, unfortunately I did not realize how much it would cost, and now I am trying to save money, in the meantimewant to make sure my rights are not violated.
3 Answers from Attorneys
Re: credit card debt and collections
Both the Fair Debt Collection Practices Act as well as the Massachusetts Consumer Protection Act give you as the debtor a myriad of rights against both creditors and collectors.;)These laws are only applicable to "consumer debtors" and, as such, are not applicable to transactions where the debt was incurred for commercial or business purposes. Please feel free to contact my office for a free initial consult based upon the facts of your specific situation.:)))
Re: credit card debt and collections
I don't think the credit card company would have any luck going after the employee. Employee's defense might simply be that you are ultimately liable because s/he was only acting as an agent and incurred the debt for your benefit.
You may send a demand for validation to the collection agency requesting validation of the debt and requesting that further communications cease. My office charges a flat rate for these letters. The collection agency must provide validation within 30 days, or it's rights are limited.
My office represents debtors in your situation, and successfully defends against or settles claims against you on favorable terms. In my experience, American Express (acting as an original creditor) is extremely aggressive, organized, and always prepares to litigate (unlike some other creditors). Please don't hesitate to contact my office.
Re: credit card debt and collections
Although the federal and state ( Massachusetts) consumer protection laws are geared principally to individuals, you may indeed find relief ( particularly if your business was a sole preprietorship - i.e. conducted as an individual using a registered fictitious business name - a dba). Under M.G.L. Chapter 93A, businesses conducted in other entities (i.e. corporations, partnerships, and limited liability companies) may also obtain relief from debt collectors who use unfair and deceptive means to collect debts. The law of contracts and torts in most states in the hands of your attorney offer additional legal tools to bring about a favorable outcome for a debtor. The Fair Debt Collections Practices Act has very defined actions that if violated by a debt collector, will offer you and your former employee relief.
This Office specializes in certain consumer matters. All initial consultations are free.
Good Luck!
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