Expert: Christine Janklow - 3/4/2010

Question
My wife was the ExDir of a 3 person non-profit.  They received a small grant from Amex in 2004 and she was led to believe they had to take out a corporate card.  She and the bookkeeper were the 2 cardholders.  They hardly used it and so in 2006 my wife destroyed her card and instructed the bookkeeper to to the same.  My wife retired from the organization in 2007.  Recently the new ExDir caught the bookkeeper trying to pay a charge on the account from the corporate bank account.  She stopped the check and fired the bookkeeper and called my wife to inform her.  My wife immediately called Amex and asked to close the account.  They told her she couldn't as there was an outstanding balance of $17K.

It turns out the bookkeeper has been using the card all along but when my wife retired the account was paid up.

The police are investigating a fraud charge against the bookkeeper (very slowly).  She had been intercepting all correspondence from Amex and doctoring the accounts so nothing showed up. What is my wife's liability and what's the best way to deal with Amex who call daily and are threatening to send the account to collection?

Answer
Frank:
Thank you for your question. First of all, your wife is or was an employee of a not for profit, and unless she personally guaranteed the card with her social security number the account should not be deemed as her debt. The account will be closed if no one makes payments on it, and until you get the damages straightened out will likely be sent to collections. Let them, it may be easier to dispute or settle with once whomever the responsible party is deemed to be is acknowledged. Your wife should do a couple of things, she should contact the creditor in writing explaining her situation, timeframe, association with the organization whose name was on the card, etc. The purpose of the certified/mailed letter should be to dispute her role as authorized user only, not guarantor. This claim should place her in a 30 day reprieve from collections while they check out the claim. Also she should tell them that all communications should be made in writing (no calls). She should also contact or cc the grant company/dept. at Amex so they know what happened too, perhaps they can assist. That will at least buy you some time to figure out what happened and go from there. Screen calls, you have no obligation at this point to explain anything to a telemarketing style collection agent who is only trying to get anyone associated with the card to pay up. Once you have more concrete information, you can address the matter with a supervisor in Amex collections to rectify. Good luck and if you found this answer helpful take a moment to provide a positive rating.

Respectfully,

Christine Janklow