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Home >> Lending >> Credit Cards
Partner Abuses Company Credit Card
I opened a business credit card in 2006 at my branch bank with partner, where we were both guarantors on each other's card. We closed the business in April of 2007(no balance on this account: I forgot to close). She charged personal debt to this card without my knowledge. I found out in Jan. '08, when the bank contacted me and I brought the delinquent account up to date. She continued not to pay her debt and the bank took $8942.03 out of my personal account in March of '09 (with a ten day phone notice demanding payment in full). I was unaware that she remained delinquent; she led me to believe she was making her payments. I have been a long term customer of this bank with excellent credit. Was this a legal move by the bank?
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 Legal? Yes, absolutely! Each of you guaranteed the other's obligation on the account.
Ask yourself why, after forgetting to close the account in April 2007, you failed to do so again after bailing out your former partner in January, 2008. That should have been your wake-up call that there were problems. As guarantor, you could or should have, taken it upon yourself to follow up each month on the obligation if you remained "on the hook" as guarantor.
If you haven't already done so, free yourself of future liability. Inform the bank that you want the account closed or a release of your guaranty on any future indebtedness. Otherwise, you will certainly be called upon again to cover for your former partner's delinquencies.
Published on BankingQuestions.com 12/08/09
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