The Credit Guy

Laid off, but stuck with corporate card bill

The Credit Guy columnist Todd Ossenfort

Todd Ossenfort has been chief operating officer for Pioneer Credit Counseling since 1998. He writes our weekly “The Credit Guy” column, answering reader questions about credit counseling and debt issues.

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Question for the expert

Dear Credit Guy,
I was employed with a large corporation and was given a corporate credit card for business expenses and to entertain clients. I was recently laid off due to corporate cutbacks and was required to hand in company property. I handed in my credit card and now have started receiving credit card bills for the corporate card. Am I liable for a corporate credit card that I never applied for or requested? And will this damage my personal credit if I don’t pay the bill? I am confused and concerned about the legal ramifications. Hope you may have an answer. — Chris

Answer for the expert

Dear Chris,
Hindsight is always 20/20. Let’s hope that the corporate credit card you received and used is a card on which you were only an authorized user and, therefore, not financially responsible for the balance on the account. First, I would communicate with your former employer and let them know you are receiving statements. It could be as simple as the company apologizing and correcting the billing information so that the statements are sent to the correct place. However, to cover all the bases, I would check your credit report and see if the corporate card account is included among your personal accounts. My thought is that it will not appear on your credit report.    

If for some reason the card is listed on your credit report, the report will list what type of account it is — whether it is listed as your account, a joint account or an authorized user account. If it is listed as your account or a joint account, then you need to start worrying because you are responsible. If listed as an authorized user account, it can still affect your credit, but you are not responsible for any unpaid balance.

How much you need to worry about how the corporate card will affect your personal credit history depends a great deal on how the billing and payment of the card was handled. From your letter, it sounds like you did not personally pay this bill and then get reimbursed. If you did, however, pay the bill and then get reimbursed, you may have more trouble explaining to the creditor that you are not responsible for payment. I’m not suggesting that you not try and explain it, but in this case, I would seek help of an attorney to be heard.

I’m hoping that you have never received a statement before and have never paid the bill, but you’re still not out of the woods. If the account appears on your credit report, I would recommend that you dispute the item with the credit bureaus using the reason that the account is the company’s and not yours. You may not have any luck getting it removed, and if that is the case, I recommend you add a 100-word statement to your credit file that explains the account is a company account and not your responsibility.

The worst case scenario is that the company may have used your personal information that it has readily available, mainly your Social Security number and date of birth, to open an account in your name. This is not legal, but you will have to prove that the company opened the account using your information without your permission. You will need to hire an attorney to help you get the account and information removed from your name and from your financial responsibility.

Take care of your credit!

See related:Using corporate credit cards wisely, How corporate credit cards can affect personal credit scores 

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