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$200k+ ... Ch 7? Fight? Help?!

Submitted by berg4103 on Tue, 06/23/2009 - 16:19
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I need some advice, if anyone would be so kind...

Stopped paying two Amex bills in Jan '08. I was a victim of fraud by a business associate who I let use Amex cards for business transactions, he started to pay the debt but then split town. He did this to 6 other associates, I came to find out later. Basically we were all victims of his ponzi scheme.

I am stuck with over $230,000 in Amex debt that I could not dispute with Amex because he dragged out paying me little by little until the SOL to dispute with Amex was up. Did I call the police, the feds? No, I was told by numerous atty's that they will not do a thing, as I gave him full authority to do the charging and it is a civil matter that he did not pay the debts off.

Thus, I contacted a BK atty Jan '08, seeing no other options. He said not to file BK/Ch 7 just yet, and to stop paying all other cc's and save my cash to live. My business was radically affected and I technically am unemployed now due to the losses and lack of business from all of my credit being turned off.

He said to dispute every collection attempt until anything could get validated. I retained him initially and to this day he's there for BK advice but no consumer affairs advice.

Starting in Nov '08, I received a hit on my credit reports of an inquiry by a law firm/Coll Agency in regards to Amex. They contacted the BK atty, asked for a settlement of $50k, he told them to pound sand. They sold the debt to First Source Adv in March. They wrote me in April sending a demand letter. I asked for debt validation and heard nothing back (sent CMRRR).

10 days ago, I got a phone call from Trauner, Cohen & Thomas. I informed them I had retained a BK atty, and told them to call him. 2 days later and dated the same date as our phone conversation, I received a letter from TCT stating that they represent CACH LLC, in reference to an original account with Amex. It also states that "no atty with our firm has personally reviewed the particular circumstances of your account," and that, "if they do not hear from me, the account will be returned to their client for further disposition." Everything I read about CACH and TCT are negative, so I need to be ready to fight this tooth and nail.

Considering they've contacted my BK atty who told them that I have retained him to file BK, should I still send a debt validation letter? If so, how do I structure the validation letter?

I don't want to file BK as these debts within Amex are not technically mine and I will/cannot pay them back. I have no other options except to put the burden of proof on them... no atty I've contacted in 2 years has helped me or wanted to help me, seeing no $$$ in it for them. The only atty who listened is the BK atty, who now won't help me unless I want to file.

Any help is GREATLY appreciated!


I would ALWAYS send a DV letter to a CA...if they can't validate, they can't collect (which mean sue as well as report on your CRA).

Technically, you are ultimately responsible for the AMEX cards...the only other recourse I see is to sue your partner. If you are the authority signer on the card and you gave one to your partner, AMEX will still hold you responsible. Sorry to say.

Unless you are able to settle your debts, chances are, for $230K, AMEX WILL sue you. Without a source of income, there is no way you can pay this back. I would talk with several BK attorneys. Sorry to say (again) that this is probably your best avenue. I don't know your whole situation...so please, talk with the attorneys.

Sometimes, the hardest thing to realize is when to give up the fight.


Submitted by desperatelyseekingsanity on Wed, 06/24/2009 - 08:19

desperatelyseekingsanity

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Considering Amex has sold this off 3 previous times to other CA's who have been told either to validate or to contact my bk atty, and Amex even resent me normal "let's work this out" bills just 2 months ago, I think it's safe to say they have no validation to speak of. But, I need to have my ducks in a row before I speak out of turn.

We're already at almost 2 years and the sol here in CA is 4... my bk atty said to drag this out as long as possible, he didn't just rush me into filing bk. I have to trust that a little don't I?

What is the best form of validation letter to send? There are several in here, and several I've seen elsewhere... any guidance would be much appreciated.


Submitted by berg4103 on Wed, 06/24/2009 - 08:52

berg4103

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Sounds to me that AMEX still owns the debt...they didn't sell it off...so the CA were just collecting on it...when you DV'd them, they sent it back to AMEX...IMHO.

Don't know what to tell you...if you have advice from several attorneys and they are all telling you the same thing...I would think that would be the way to go.

Since you already have a few DV letters, modify them to your needs...there is no one cookie cutter DV letter...just make sure it fits your needs.


Submitted by desperatelyseekingsanity on Wed, 06/24/2009 - 09:17

desperatelyseekingsanity

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