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Old American Express Debt

Daniel Cohen
UpdatedOct 15, 2010
Key Takeaways:
  • A credit card issuer can do business with whomever it chooses.
  • American Express may have reserved a right to collect from you later.
  • Refer to your settlement contract for your liability for the debt.

I settled an American Express debt 17 years ago. If I open a new account today, do I expose myself to liability for my old American Express debt?

Had an AMEX dispute in 1993. They closed the account in 1994 - made payments through consumer credit counseling group; believe they negotiated discount; not sure. Over the years I have had a few collection agencies try to collect (assume they bought receivable from AMEX) but never paid as statute of limitations applied. My credit is great (and has been for the last 8-10 years and only shows AMEX account was "paid" and "closed by grantor". I swore I'd never do business with them again so it's never really been an issue Reason this is coming up now. Employer solicited a corp card on my behalf last week. AMEX sent me adverse action letter saying my "app" was declined because previous account was closed for 'derogatory reasons.' DNB subsequently guaranteed the app and AMEX has now issued me a new corp card Question for you is: If I accept the corporate card can they come after me for the old debt? I mean even though the statute of limitations is long gone, can they take my acceptance of the new corp card and re-set the clock and come after me? Any info would be greatly appreciated… I spent sooo much time way-back-when clearing this up and dealing with the nightmare afterwards that I really don't want to open myself up. If you don't know, maybe you can refer me to someone or some web site?

If you or an agent working on your behalf negotiated a settlement with American Express, then the company violated your settlement contract when it sold your collection account to a collection agent. If that happened, you had a cause of action against American Express.

A credit card issuer can do business with whomever it chooses. If you and American Express parted ways less than amicably either or both of you can choose not to do business with each other again.

You ask for an opinion on a settlement contract that may or may not have existed. Let us assume for the sake of argument it never did. Can American Express try to collect the money it believes you owe it? No, because it sold your collection account to a collection agent. Can American Express refuse to do business with you. Yes it can. By opening an account with American Express do you expose yourself to liability? Unlikely, but given that you believed you settled the debt, and then American Express sold your collection account, it appears there is some confusion over the status of your account.

Readers have written to me stating American Express has written into settlement contracts a clause stipulating that if the consumer applies for an American Express account in the future, the application will be granted if the consumer makes American Express whole for the deficiency. Is such a contract legally enforceable? I do not know. Did you sign a contract containing that clause? I cannot say.

More About American Express Debt

I answered questions about American Express debt for other readers. See American Express Bill and AMEX Debt where a small business owner had $60,000 AMEX debt in collections and needed to know the debt resolution options; American Express Debt Settlement where a reader asked if he or she could trust an unsigned faxed settlement offer from a collection agent; Negotiate American Express Debt where a reader wondered why an American Express collection agent required a hardship letter when negotiating a settlement; American Express Company Debt, where a reader asked if he or she was responsible for American Express debt incurred during the course of employment and the employer is now defunct; and Deceased's American Express Debt where an authorized user of an American Express account holder who died recently has liability for the debt.

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