Question about corporate credit card

[BROKEDED]

This is great (not). My wife's company wants her to fill out an app for an AMEX Corporate card. AMEX is one of the two CCs that we will be including when we file here shortly. The app appears to use her credit info, which is probably in the toilet right now, I assume in case she were to use the card to make unauthorized purchases. This will also allow the company rep to receive her denial.

1. IF she were to fill out the app and IF it were to be APPROVED, what problems could this create?

2. Would we have to include the Corporate account on any paperwork when filing?

Also, I told her that she might be able to simply say that for personal reasons she can't accept any more credit responsibility at this time and simply pay out of pocket. The card app was for travel purposes during the 3 or 4 times a year that she'll be required to fly and stay for a few days. I would guess costs would be around $1000-1500 per trip.

3. We CAN come up with the cash but if she had to travel before we filed or before we had our 341, would the outstanding balance due back to her for repayment be seen as a sitting duck by the Trustee?

4. What problems could THIS approach create?

Need help fast as they want the app to be filled out by tomorrow.

[tcreegan]

Hi BROKEDED,

...how about "I can't apply for AMEX right now as I am involved in litigation with them."

If asked for details "I am not at liberty to discuss the case until it is resolved"

....might be better than applying and getting denied, or applying and getting the acct closed as soon as the BK is filed.

Saw some post awhile ago on AMEX, can't remember if they were bent on closing the minute you file or they were OK w/ leaving no balance credit lines open....maybe a quick search?

...oh well, not much of an answer, just some thoughts bouncing around ....

Tom in Colo

[BROKEDED]

Tom, I found that post about the AMEX corporate card and it appeared the concensus was that in a 13 they would leave it open but close it in a 7. I heard back from our BK paralegal just a minute ago. Her main concern was mainly our business becoming someone else's by either being denied or being approved and then closed. She didn't seem to be concerned with preferential payments as long as they were required business expenses and there was a paper trail to justify them.

However, I think we're going to stick with, "I can't accept any more credit responsibility at this time." The paralegal liked that response but if push comes to shove then I like your response. I don't think it would come to that but if it does then that should be enough to stop any further pressure. I told my wife that we can get VISA Gift Cards throught the Credit Union for $1 that hold up to $500 and don't show up on bank statements but purchases can be printed out from the website if needed. That may be the way to go.

Thanks for your response.

[Kasey13]

Hello,

I read your post and had to respond. I work for a company that it is almost a requirement to have a corporate card too...

I had an AMEX and it had a 0 balance, but as Tom from Colo stated, they closed that account within days of me filing Chapt 7. I had to explain that it was closed to my boss and the reason, so it was mildly embarassing. I would go with your current statement to the company, but keep in mind...sometimes large companies make it mandatory to have the corp card and make it a condition of employment(but I don't think that is legal in all states). I would handle it the way you are and if pushed use tcreegan's response...

Just thought I would offer my 2 cents

[Flamingo]

With those in our company who are required to have a Corporate AMEX card (those that travel and have a travel profile on hand or all upper management/executive level), the employee is required to fill out a form from HR which is sent by HR directly to AMEX. It is stated right on the form that the card depends on the employee's credit. The card will be in the employee's name and home address.

You would need to check with your HR section as to how they handle their cards but it is probably the same way. So if you personally included AMEX in your filing, you will probably be denied for the corporate card. You may want to check with your HR office first before applying and getting denied.

[meateater]

If amex has a policy that people who have BK'd are not eligible for a corporate card, and a company has a policy requiring that the employee have a corporate amex card, isn't that an easy way for a company to not hire/fire people who have filed? Wouldn't this be illegal (at least the firing part, and maybe the hiring part for a government employer)? I'm hoping someone more knowledgeable chimes in. I thought of this after the lawsuit for credit report post - it seems like making eligibility for amex a condition of employment a short-hand way of getting anyone with a BK off the payroll.

I understand a policy that an employee have the ability to travel (which generally requires money up front or credit), but can't understand why having a particular credit card (that's BK unfriendly) could be a legitimate employment requirement.

[Flamingo]

If amex has a policy that people who have BK'd are not eligible for a corporate card, and a company has a policy requiring that the employee have a corporate amex card, isn't that an easy way for a company to not hire/fire people who have filed? Wouldn't this be illegal (at least the firing part, and maybe the hiring part for a government employer)? I'm hoping someone more knowledgeable chimes in. I thought of this after the lawsuit for credit report post - it seems like making eligibility for amex a condition of employment a short-hand way of getting anyone with a BK off the payroll.

I understand a policy that an employee have the ability to travel (which generally requires money up front or credit), but can't understand why having a particular credit card (that's BK unfriendly) could be a legitimate employment requirement.

As to your second sentence above, one would have to discuss with their employer why that company utilizes a specific corporate card carrier. Most companies require their employees that travel to have a corporate card and there are types that are guaranteed by the company or that utilize the credit of the applicant. Those that do not travel usually don't need one and can utililze their own credit cards for minor business expenses and submit an expense report for reimbursement. If granted by the company, all charges are sent in directly to the company for payment; if the card is granted on the credit of the applicant, the card is in the applicant's name and the bill goes to the applicant's house and the applicant makes the payments after submitting an expense report for reimbursement to pay the bill.

An employee cannot be fired for being denied a corporate credit card due to BK or bad credit. However, to avoid embarrassment in a situation such as this, it is always best to discuss the situation with an HR rep or one's boss to either not apply and/or deal with any expenses in another way.

[DesdemonaB]

Corporate CC

Hello

I work for a company that requires a corporate cc to be used on what they call T&E - Travel and Entertainment which is issued by Citibank. I can tell you from my personal experience the following:

While the application asks for personal information this card does not report, and is guaranteed by the corporation only. Our company pays our T&E cards twice a month, as long as I submit my report on time there is never a balance. The only way it would ever affect your credit is if you were issued a card, went out and spent your limit on personal items then quit your job walking away from the balance owed.

There is no credit check on a corporate issued card, unless you are the corporation meaning you start your own business, since there is no reporting, and as long as you follow the rules of your company travel policy you should have no issue.

As for telling the trustee, I did not include or brought to the attention to the fact I have a corporate issued Citibank card with a 10,000 limit. As it against company policy to use the card for personal items – I would not use anyway I happen to like my job and don’t want to lose it.

I had a personal Citibank card included in my BK and when I was issued the card back in 2005 I had a charge off of a second Citibank card that went in to collection and I was not declined for the corporate card. I know people who filed BK from my company who were issued the card without a blink of the eye.

I don’t believe it should be an issue as card is paid for by your company, not you.

[BROKEDED]

I don’t believe it should be an issue as card is paid for by your company, not you.

Well, there is the question. There were two members (kb584, olivies) in a different thread, specifically about AMEX corporate cards, where the card holders submitted expense reports, the employer cut them a check, and then the employee paid the AMEX bill. The AMEX cards were tied to the employees SSN which is what my wife is asked for, to also include home and billing address, home phone, employee ID, etc...

Here is the fine print at the bottom of the app.

-----------------------------
The Applicant and the undersigned Company, through its authorizing officer, (a) request that a Card be issued on the Company's account to the Applicant, and (b) authorize the receipt and exchange of credit information on both the Company and the Applicant, and (c) agree to be bound by the terms and conditions of the Agreement(s) received with each Card ("Agreement"). The individual Applicant (a) authorizes American Express to notify the Company if American Express decides to decline this application, (b) agrees to use the Card issued in connection with a business account opened in the Company's name, and (c) agrees to be liable for payment of all charges to the Card in accordance with the terms of the Agreement. All applications require countersignature of an authorizing offcer of the Company to authorize issuance of the Card even if the same individual signs twice. TITLE MUST BE INDICATED. Payment For charges on your Card account is due in Full upon receipt of your monthly statement. If an amount is past due For two billing cycles a late fee will be assessed. Late Fees vary From state to state, and range from 1.5% to 2.75% of the delinquency amount(s) per month. Court costs plus attorney's fees of up to 15% of the then unpaid balance of the Card account may be added to your account iF we must reFer it to an attorney For collection. Appiicant hereby represents that the Corporate Card will be used for business or commercial purposes.
-------------------------------

I think that Citi and AMEX may operate differently with corporate accounts. I'll have to get my wife to carefully ask about the billing, credit, and payment procedures but if you read above, it states that the individual applicant agrees to be liable for payments.

[tcreegan]

Hi all,

Back in the day when I was in business, corporate cards were treated like your company desdemona. Basically the employee was no more than an 'authorized user' I still can't wrap my head around the 'its a corporate card but in your name, credit, and ssn'

...but then I can also remember getting per diem of $45 a day, in cash.

Tom in Colo

[DesdemonaB]

Hi Brokeded

The question is.. will she have to pay the balance then submit of reminbursment?

My corporate cc is "tied" to my ss number as well as my employee number, I have never in 5 years cut a check to Citibank - but then again I never charged a single personal item to my card. As for your remark that the individual applicant agrees to be liable for payments - do they mean all or just personal?

[justbroke]

As for your remark that the individual applicant agrees to be liable for payments - do they mean all or just personal?

It's actually joint and several liability. The company and you are responsible. However, and beware, the company can file an affidavit of no liability should you incur expenses that are not business expenses. The reason why these cards enjoy such a high credit limit, mine was $100K, is due to the joint liability of the business and you personally, but mostly because of the business' guarantee of payment on business expenses.

[Charlie777]

My employer started an Amex Corporate Card requirement after I had been working there for about two years. I had previously defaulted on Amex years earlier but they thoroughly blacklist and wouldn't give me the card. My employee guaranteed the card for a $4K limit and after six months or a year the limit became unspecified and the guarantee was released. There was, as far as I can recall, no credit check, and never any reporting.

A couple of years later they started a system where all charges on the Amex flow to the expense reporting system and are paid directly to Amex (after I document them in the expense system - items I don't put on Amex are reimbursed.

Move forward four more years, and I filed Chapoter 7. The Amex Corporate Card was not included in the filing and Amex didn't touch it. Amex knew about the BK because they entered an appearance in Pacer, and they were the only creditor to send me a 1099 - for that now 17 year old chargeoff I never paid. My corporate account remains in full effect and was a godsend because I couldn't have fronted up to $5K a month which I sometimes have to spend on business expenses.

[Peeps]

My organization went with Citi and USBank for both Travel Cards and Purchasing Cards. I was part of the team that worked with HR to make the decision and we specifically ruled out Amex because we didn't want to put our employees in a position where they had to be uncomfortable with putting their own financial info on the table just to be able to do their jobs.

We were able to negotiate different levels of background checking. With the purchasing cards, employee personal credit info never came into play. The corporate travel card DID involve employee personal credit info. But at least with Citi and USBank we were able to unconditionally "back" the employee. Since it was assumed that the corporation took responsibility for all of the card's charges we never actually knew if there was a problem with an individual's credit check. Amex didn't offer anything like that.

I think for our OP, the fact that they're dealing with Amex will make a difference here. It's interesting to see how CCds handle essentially the same processes so differently.

[BROKEDED]

Well that makes it about as clear as mud! hahaha Man, just when I thought I had it figured out, too. After looking at the AMEX corporate site I see they have several options for repayment either by the individual or the company. I called a general number for corporate and was told the credit app depended on the company options as well and how the charges were guaranteed but strangely told me that credit info was NOT reported against the applicant. The guy did give me another number to call tomorrow, though.

Anyway, I guess if my wife is asked for the app tomorrow, she's just gonna have to go with the can't except any more credit responsibility/litigation excuse. From most of my reading it appears that the card would be based on my wife's credit as far as approval/denial with her and the company guaranteeing the payments. It also appears that if she were approved, it would not survive BK7 especially since they will be included in our personal filing AND she would have to ask the administrator to have the company guarantee the card for reactivation.

I think it's going to be easier to find an alternative solution until we're out of BK7 instead of complicating the issue right before we file. Why is nothing ever simple???

On a side note, this is a new position/promotion (2nd one in 6 months...u go girl ) and I thought she would have to travel 3-4 times per year but to my surprise it may be 10 times per year! aACKKK!!! If we have to go the pay first/get reimbursed route, I sure hope they are expediant about cutting checks!