Can a collection agency make me pay a debt that the previous business owner had created on an AmEx card?

Question

Apparently, its an AmEx business credit card and both the previous owner's name and the business name is associated with it. I had purchased the business, but the previous owner did not fully disclose his debt.

Yes, the business was and still is a sole proprietorship.

Answer 1

It depends on the structure of the business.

Was it a sole propietorship before you purchased it? If so, you did not purchase the "business" per se, but you purchased the assets of the business. If you're also a sole proprietorship, then you just need to inform the American Express folks that you purchased some of the assets, including the name, of the business from the previous owner, but they should contact the previous owner for collection of this debt.

If it's an LLC or a corporation that you actually purchased ownership of, then the LLC or corporation may actually be liable for that debt. If that's the case, depending on the size of the debt and the corporation's ability to pay it, you may wish to consult an attorney concerning your options.

Good luck.

Answer 2

Generally, the purchase of a business includes assumption of debt.

I'd go back to the seller. Threaten to sue if if need be.

Answer 3

Look up the term 'due diligence'.

It means doing all the research necessary before committing to a business deal.

To have debts outstanding on a business you bought, and not know about those debts when you bought the business was negligent on your part.

You bought the business, you bought the debts.

Answer 4

i am not sure seek legal advice from a lawyer and check the sale papers for the business it might be in the fine print

Answer 5

I personnaly don't think so, but I would suggest you get a lawyer, cause it sounds like they are trying to stick it to you.