NSW Debt Recovery Chasing Me for Corporate Credit Card Transactions?

[DMQC]

Hi Rostos,

In relation to your second last message - the chargeback has nothing to do with your liability for the AMEX card. I think it is best to forget what is and isn’t appropriate about the chargeback since it is between the other director and the bank. It would only be relevant if you were sent funds by the director, which you used to pay the AMEX from your bank account.

In relation to your most recent message - I don’t imagine FOS will be much help to you, AMEX are within their rights to chase you or the Company. Rather the main dispute is between you and the Company you were director.

If you like I can provide you with some information on how I would resolve the situation if I were in your shoes?

Regards

 

[Rostos]

Thanks DM

So what is the point of FOS here? If they decide in my favor, is AMEX then forced to stop going after me? If not then what is the point of FOS?

Also, the charge back imo is central to this argument. The company did pay for it. There was nothing illegal or untoward that payment. It was charged back for with no justification. So the company gets its money back and even though me and the company are both still liable, AMEX is still going after me?

I am sorry if I am coming across strongly, but my blood is boiling. I did nothing wrong, acted in good faith and followed orders in accordance with my conditions of employment. Payment legally was arranged, now a director for whatever reason raises a dispute and the bank for no valid reason and reverses such a transaction and now AMEX is chasing me?

I forgot to mention, I had a lawyer call AMEX and he spoke to a manager in the credit department and the lawyer communicated back me that the manager said that he does not know why they are chasing me.

This is all very confusing....let's not forget the company is also liable at this moment.

What would you do?

 

[DMQC]

No problem Rostos, and please don't apologise. I understand this must be incredibly frustrating, particularly since you have followed the rules and it has been thrown back at you for no good reason.

If you have made a complaint with FOS in relation to AMEX contacting you about "the debt", I cannot imagine FOS instructing AMEX to cease with their recovery action. At the end of the day, through no fault of you (or AMEX it would seem) AMEX is out of pocket and an account which you are partially liable for remains unpaid, despite it being paid previously.

It is probably worth noting again that AMEX would not have had a choice or any input in relation to the chargeback, it is between the Director and the Company's bank, both you and AMEX are powerless in this regard. It is probably best to view AMEX as another innocent party to this situation, with the main "culprit" being the Comany/Director A/B. Since AMEX is an "innocent party" I think FOS will not be of much use to you, rather you may have more luck reporting the Bank that processed the chargeback to FOS or APRA, although this would not be my chosen method to resolve the situation.

It is good to hear you had a lawyer contact AMEX, although I think it is quite clear that if you were named on the account then it is quite straightforward why they would chase you for an unpaid account. I agree the Company is also liable, and should be held solely liable for the debt.

Anyway, in order to resolve this I would -

1. Contact the Directors if you are still on speaking terms with them and see what the issue is, alternatively send an email so there is a paper trail.

2. Send AMEX a letter outlining your position, why you're not liable and include a cease and desist letter in relation to the recovery action. Don't forget AMEX likely (given them seem quite useless) are probably not aware you are no longer a director of the business, once this is made clear to them in writing it may see them stop with the recovery action.

3. Failing that, and if AMEX continue to pursue the debt I would bring an action against the Company in the local magistrates Court to recover the balance of the account. Depending if the amount was less than $10000 and if I were not a lawyer I would go to the Court unrepresented since it is quite straightforward if you bring it as a minor claim.

You are also not liable for the other parties cost if you bring it as a minor claim. I am unsure on the exact rules for each state however if you tell me what state you're in I will gladly explain the process. If it is more than $10,000 consider applying to legal aid for assistance with a civil dispute, this is usually means tested and depending on your income they may agree to represent you for free. If not, you would need to contact a lawyer.

At the hearing in the Magistrates Court you could present the evidence you have that the Company agreed to pay the AMEX account (which you said you have) and the Court will hopefully make an order for the Company to pay you the amount of the AMEX account which you can then use to pay AMEX and end this fiasco.

Hope that helps

 

[Rostos]

Appreciate this heaps....Thanks

Just on a side note, what is the point of FOS here? Can they force AMEX to cease chasing me or force me to pay?

 

[DMQC]

No problem Rostos, it is just a run through of how I would approach it, by no means the only or probably the best way to resolve it, but it is how I would approach it.

FOS is, in my view, a toothless tiger, they are great for situations where “decisions” are involved I.e insurance claims being declined etc but not so great, in my experience, at investigating situations such as yours. Given the complexity of this situation, the unknown information (such as what was said to have the chargeback raised) and other aspects, I don’t hold much hope that they would have the resources or powers to investigate this properly.

Also this situations spans several areas of law, from employment law, to fiduciary duties of directors, Credit and Banking law, and if the chargeback was fraudulent, maybe even criminal law (which is a no go area for FOS anyway), so it is for that reason I don’t imagine they will be much help, and ultimately they only make recommendations anyway, not “orders” like a Court or tribunal.

All the best, let me know if you need more information.

 

[Rostos]

Oh ok. Thanks again.

The FOS hearing is on Monday. My best bet here initially with this meeting is to convince AMEX to go after the company. As I said earlier, the lawyer that originally spoke to the credit manager said that he does not know why they are chasing me.

 

[Rob Legat - SBPL]

Be aware that a determination by FOS is binding on the financial services provider, but not on the consumer. If they don't abide by it, you can register it with a court, and it can be grounds for expulsion from the scheme. When you're required to have external dispute resolution membership to keep your credit licence, that's a decent stick.

 

[Rostos]

Interesting, thanks SB

The more I think about it, by AMEX going after me, they are rewarding the party that acted contrary against their best by taking money away from them and punishing the party that acted in their best interests.

 

[Rostos]

I can't believe I did not remember this. It has been a fair while (1 year) since I worked there.

I used to receive charge back requests from WESTPAC (same bank) where disputes were raised by our customers. Not many, but we did receive them.

The letters that we would receive show which customer raised the dispute and i had 5 days to reply otherwise Westpac to charge back the money that was in our account back to the customer.

So WE the company would be in the same position AMEX are in right now. Money came into our account from another account like it did into AMEX's account.

I would then investigate the nature of the dispute. Some customers (elderly) simply forgot who there telco provider was. When i called them and discussed it with them, they realize. I would then contact the bank and they would close the chargeback.

This is the crux of the issue, just because someone raises a dispute does not mean that they are in the right and have NO BASIS or JUSTIFICATION to have there money returned.

Now, I think this is where the issue could be. There were a few times, I did not respond to the request in time and Westpac reversed the money even though there was no justification to reverse it. Whose fault is that? Well it was mine simply because of my lack of action on my behalf. I would then chase the customer to get the money back.

SO it seems like AMEX did not investigate the nature of the request (as I did when I received chargeback requests from the bank) and just assumed the person who raised the dispute was right (which he actually was not) OR they did send a request to the company and no one responded or AMEX did not respond to it in time. Why is that my fault?


Surely that is enough grounds for AMEX to chase the company which is also jointly liable instead of me?

 

[Rob Legat - SBPL]

Go back and read one of my first replies, where I said they might not have received enough time to respond. I know for a fact that Westpac always post out chargebacks, and due to the current delivery time frames for Australia Post - they are often received after the due date for response.