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  1. #1

    Default Owner of a Closed Business Sued Over Unpaid Debts

    My question involves business law in the state of: Florida

    I have received a summons from Wells Fargo Merchant Services that demands I pay 12,432.00 for a merchant account that was closed due to chargebacks. Not only did they close the merchant account down for chargebacks they put myself and the company name on the TMF List (Terminated Merchant File LIst) causing our company and myself not able to open another merchant account to conduct business.

    More importantly, we had hardly any merchant chargebacks when they decided to go to the extreme and terminate our account and blacklist us from obtaining a merchant account again. I see this online all the time when it comes to Wells Fargo.

    More importantly, I was planning to goto the court house myself and respond with an answer tomorrow being the 2nd to last day. However, I just noticed that it said the company MUST be represented by an attorney and I can represent myself.

    What options do I have to not receive a default judgement against me individually. The company is closed down and I do not care what files against it but I have prefect credit and I want to maintain my credit rating.

    The courthouse is Broward County Satellite Courthouse.

    The complaint states that these customers charged back their payment to the company and they want to be repaid. The merchant account was opened on May 1st 2012 on or about and closed within three months of having charges pass through the account.

    I do not mind paying them because I do have a 200k line of credit with the bank individually and want to keep that in good standings. They haven't done anything to me personally and I would like to keep it that way. Can anyone give any advice or help me respond quickly. I am availalble all night and would appreciate your response.

    Will an affirmative defense stop them from doing anything? The only income I have now is social security and a small pension from when I retired. I also have a IRA that is paying me $400 a month.

    Do I have any options? If so, whats the best one? And Fast ! Help

  2. #2
    Join Date
    Apr 2009
    Location
    Inland Empire
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    1,410

    Default Re: Wells Fargo Merchant Services vs My Company and Individually (Closed Business)

    Quote Quoting benjamincardozo
    View Post
    My question involves business law in the state of: Florida

    I have received a summons from Wells Fargo Merchant Services that demands I pay 12,432.00 for a merchant account that was closed due to chargebacks. Not only did they close the merchant account down for chargebacks they put myself and the company name on the TMF List (Terminated Merchant File LIst) causing our company and myself not able to open another merchant account to conduct business.

    More importantly, we had hardly any merchant chargebacks when they decided to go to the extreme and terminate our account and blacklist us from obtaining a merchant account again. I see this online all the time when it comes to Wells Fargo.

    More importantly, I was planning to goto the court house myself and respond with an answer tomorrow being the 2nd to last day. However, I just noticed that it said the company MUST be represented by an attorney and I can represent myself.

    What options do I have to not receive a default judgement against me individually. The company is closed down and I do not care what files against it but I have prefect credit and I want to maintain my credit rating.

    The courthouse is Broward County Satellite Courthouse.

    The complaint states that these customers charged back their payment to the company and they want to be repaid. The merchant account was opened on May 1st 2012 on or about and closed within three months of having charges pass through the account.

    I do not mind paying them because I do have a 200k line of credit with the bank individually and want to keep that in good standings. They haven't done anything to me personally and I would like to keep it that way. Can anyone give any advice or help me respond quickly. I am availalble all night and would appreciate your response.

    Will an affirmative defense stop them from doing anything? The only income I have now is social security and a small pension from when I retired. I also have a IRA that is paying me $400 a month.

    Do I have any options? If so, whats the best one? And Fast ! Help
    How is it that you have a line of credit available if the business is closed?

  3. #3
    Join Date
    Sep 2005
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    Default Re: Owner of a Closed Business Sued Over Unpaid Debts

    Quote Quoting benjamincardozo
    View Post
    I have received a summons from Wells Fargo Merchant Services that demands I pay 12,432.00 for a merchant account that was closed due to chargebacks. Not only did they close the merchant account down for chargebacks they put myself and the company name on the TMF List (Terminated Merchant File LIst) causing our company and myself not able to open another merchant account to conduct business.
    If you had a negative balance of $12,432.00 in your merchant account due to charge-backs, without an incoming stream of sales to cover that debt, I can't blame them for cutting you off. The fact that you still haven't paid off that debt makes that seem like good judgment on their part, lest they end up with you owing even more money.
    Quote Quoting benjamincardozo
    More importantly, we had hardly any merchant chargebacks when they decided to go to the extreme and terminate our account and blacklist us from obtaining a merchant account again. I see this online all the time when it comes to Wells Fargo.
    If you can rack up a five figure debt from a small number of chargebacks, it's easy to see why they would see you as a bad risk.
    Quote Quoting benjamincardozo
    More importantly, I was planning to goto the court house myself and respond with an answer tomorrow being the 2nd to last day. However, I just noticed that it said the company MUST be represented by an attorney and I can represent myself.
    You can represent yourself as an individual. If the business does not appear and defend, they'll presumably get a default judgment against the business. You can expect that they'll promptly start looking for any assets that arguably belong to the business to help satisfy that debt.
    Quote Quoting benjamincardozo
    What options do I have to not receive a default judgement against me individually. The company is closed down and I do not care what files against it but I have prefect credit and I want to maintain my credit rating.
    If you personally guaranteed the debt, it's mere luck that you don't have the default on your credit report. If you did not, it's not clear why you would have been individually sued, and it would be helpful if you shared their theory of your liability. If you are personally responsible for the debt and a judgment is entered against you, that judgment will go onto your credit report.
    Quote Quoting benjamincardozo
    I do not mind paying them because I do have a 200k line of credit with the bank individually and want to keep that in good standings.
    Then what are you waiting for?
    Quote Quoting benjamincardozo
    They haven't done anything to me personally and I would like to keep it that way.
    You suggested that they sued you as an individual. Perhaps you could do a better job explaining what is happening.

  4. #4
    Join Date
    Feb 2010
    Location
    CT & IL
    Posts
    5,273

    Default Re: Owner of a Closed Business Sued Over Unpaid Debts

    While an individual may represent her or his interest in court without an attorney, a corporation is not permitted to do so through non-lawyer employees, officers, or shareholders. See Richter v. Higdon Homes, Inc., 544 So.2d 300 (Fla. 1st DCA 1989); Nicholson Supply Co. vs. First Federal Savings & Loan Assoc. of Hardee County, 184 So. 2d 438 (Fla. 2d DCA 1966)


    So your business may get a default .. but can vacate it if it files an answer quickly.

    I assume you are not a lawyer.

  5. #5

    Default Re: Owner of a Closed Business Sued Over Unpaid Debts

    [QUOTE=Mr. Knowitall;737350]If you had a negative balance of $12,432.00 in your merchant account due to charge-backs, without an incoming stream of sales to cover that debt, I can't blame them for cutting you off. The fact that you still haven't paid off that debt makes that seem like good judgment on their part, lest they end up with you owing even more money.

    Did I suggest that I did not have an incoming stream of sales to cover that debt? Of course not.

    What I had was a few charge backs with over $30,000 in sales or 400 actual tickets, making a TMF list was uncalled for and absolutely ridiculous considering that I had 2.5MM in sales the year before with an online merchant that understand the friendly charge-back fraud game online.

    As you can see here with another gentleman made an identical claim - ripoffreport

    My chargebacks were at a bear minimum considering the sales but Wells Fargo is known to do this so I found out.

    Now to my point, If I wanted to respond because that business is dissolved how would I do so?

  6. #6
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    Apr 2009
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    Inland Empire
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    Default Re: Owner of a Closed Business Sued Over Unpaid Debts

    [QUOTE=benjamincardozo;737832]
    Quote Quoting Mr. Knowitall
    View Post
    If you had a negative balance of $12,432.00 in your merchant account due to charge-backs, without an incoming stream of sales to cover that debt, I can't blame them for cutting you off. The fact that you still haven't paid off that debt makes that seem like good judgment on their part, lest they end up with you owing even more money.

    Did I suggest that I did not have an incoming stream of sales to cover that debt? Of course not.

    What I had was a few charge backs with over $30,000 in sales or 400 actual tickets, making a TMF list was uncalled for and absolutely ridiculous considering that I had 2.5MM in sales the year before with an online merchant that understand the friendly charge-back fraud game online.

    As you can see here with another gentleman made an identical claim - ripoffreport

    My chargebacks were at a bear minimum considering the sales but Wells Fargo is known to do this so I found out.

    Now to my point, If I wanted to respond because that business is dissolved how would I do so?
    You don't seem to get it. Your chargebacks were not at a bare minimum if they exceed $12k. The fact that you were not able to pay the $12k is a clear indication of not enough cash flow.

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