Reply
Frequent Contributor
Posts: 328
Registered: ‎05-18-2007
0

AU's aren't responsible for the accounts... or are they?

[ Edited ]
I noticed this on my Amex Card member agreement and thought it was interesting.  Everyone seems to think that AU's have no responsibility on the account however, at least for AMEX they do.
 
According to the member agreement:
 
An additional cardmember is not liable for charges incurred by the basic cardmember or by other additional cardmembers.  However by each use of the additonal card to incur charges, the additional cardmember indicates his or her agreement to pay us for the charge if you(basic card holder) fail to our refuse to pay it and we may, at our discretion, pursue additional cardmembers for payment of charges they incur or authorize. 
 
It also says that AMEX can pull CR's for additional card members.


Message Edited by princessofpink on 07-27-2007 06:51 PM
Moderator Emeritus
Posts: 16,379
Registered: ‎03-12-2007
0

Re: AU's aren't responsible for the accounts... or are they?



princessofpink wrote:
I noticed this on my Amex Card member agreement and thought it was interesting.  Everyone seems to think that AU's have no responsibility on the account however, at least for AMEX they do.
 
According to the member agreement:
 
An additional cardmember is not liable for charges incurred by the basic cardmember or by other additional cardmembers.  However by each use of the additonal card to incur charges, the additional cardmember indicates his or her agreement to pay us for the charge if you(basic card holder) fail to our refuse to pay it and we may, at our discretion, pursue additional cardmembers for payment of charges they incur or authorize. 
 
It also says that AMEX can pull CR's for additional card members.


Message Edited by princessofpink on 07-27-2007 06:51 PM

AUs are never responsible for any balances or payments. I suspect Amex does not pull hard inqs (maybe a softy) on AUs seeing as they are not financially liable but I'm not 100% sure. Good question!
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Frequent Contributor
Posts: 328
Registered: ‎05-18-2007
0

Re: AU's aren't responsible for the accounts... or are they?

That's the thing. According to Amex they can be liable for the charges they make.  I thought, like you that they had no responsibility, not so according to the cardmember agreement.   
Moderator Emeritus
Posts: 7,326
Registered: ‎06-18-2007
0

Re: AU's aren't responsible for the accounts... or are they?

Can you just see them trying to sue a 14 year old kid!!!  Maybe this is what AMEX is adding to their cards  now, but I think that they would have a very hard time inforcing it. Many AUs have no idea that they are AUs.
Moderator Emeritus
Posts: 16,379
Registered: ‎03-12-2007
0

Re: AU's aren't responsible for the accounts... or are they?



princessofpink wrote:
That's the thing. According to Amex they can be liable for the charges they make.  I thought, like you that they had no responsibility, not so according to the cardmember agreement.   



No way! That will never stand up in court.
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Frequent Contributor
Posts: 328
Registered: ‎05-18-2007
0

Re: AU's aren't responsible for the accounts... or are they?

Just curious as to why you think it wouldn't hold up in court.   When the AU signs for a purchase they are agreeing to paying according card issuers agreed terms.  In this case those terms state that the AU can be held responsible.  It seems pretty clear to me.  Now if they were trying to say the AU was liable for the primary card holders charges, then that would be another matter.


fused111 wrote:

 
No way! That will never stand up in court.



  
Moderator Emeritus
Posts: 16,379
Registered: ‎03-12-2007
0

Re: AU's aren't responsible for the accounts... or are they?



princessofpink wrote:
Just curious as to why you think it wouldn't hold up in court.   When the AU signs for a purchase they are agreeing to paying according card issuers agreed terms.  In this case those terms state that the AU can be held responsible.  It seems pretty clear to me.  Now if they were trying to say the AU was liable for the primary card holders charges, then that would be another matter.


fused111 wrote:

 
No way! That will never stand up in court.



  


An AU does not sign any document with Amex (or any other CCC) agreeing to be responsible for anything. In fact, AUs don't even have to go through an app process to have a CC issued to them.
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Senior Contributor
Posts: 4,635
Registered: ‎03-11-2007
0

Re: AU's aren't responsible for the accounts... or are they?

AU's are an interesting phenomenon. In a nutshell, it's going to vary by state.
 
If one is in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington or Wisconsin), and the AU is a spouse, and the CC goes into default, then the CCC can go after the AU (even if divorced) if the CC debt was incurred "within the marital community". I know, I know. Simple, clear and easy to understand. NOT! And not all community property states are created equal.
 
I suspect AMEX is doing what it can to collect on defaulted debts in community property states. They are stretching the definition and liability from AU spouses to any AUs, but they ain't gonna be able to go after an AU unless it fits the narrow and sometimes confusing definition of debt in a "martial community" in the particular state.
 
On the flip side, if you ain't in a community property state, and you have an adverse AU TL on your CRs, that's an easy dispute and remove. Reason is because there's rock solid caselaw on the subject. Johnson v. MBNA. Linda Johnson sued in District Court, won a $90K award, and the Fourth Circuit affirmed.
 
Just my opinion, but I suspect the net effect of AMEX's provision means that if you're an AU, and the CC goes into default, even if you're not a spouse and not in a community property state, while AMEX won't be able to report it on your CRs and won't be able to sue over the debt, they will blacklist you.
 
Super Contributor
Posts: 8,195
Registered: ‎03-25-2007
0

Re: AU's aren't responsible for the accounts... or are they?

Don't know if this will hold up, but the actual thing one signs says:
 
I understand that I must provide all the information requested in this application and I certify that such information is accurate. I authorize you to verify the information on this application and to receive and exchange information about me including requesting reports from consumer reporting agencies. If I ask whether or not a consumer report was requested, you will tell me, and if you received a report, you will give me the name and address of the agency that furnished it. I authorize you and your affiliates and subsidiaries to contact these sources for information at any time and to use any information obtained about me for marketing and administrative purposes.

Additional Cards: I have advised Additional Card applicant(s) that you may obtain, verify, exchange, and use information about them in the same manner as described above, that they may be responsible for payment of their own charges if I fail to pay them, and that their own credit records may be affected by non-payment of the account. I understand that Additional Card(s) will not be issued to me if I have an unsatisfactory account with American Express or if the Additional Card applicant(s) have ever had an unsatisfactory account with American Express
.

The slide from grace is really more like gliding
And I've found the trick is not to stop the sliding
But to find a graceful way of staying slid
Moderator Emeritus
Posts: 16,379
Registered: ‎03-12-2007
0

Re: AU's aren't responsible for the accounts... or are they?



MidnightVoice wrote:
Don't know if this will hold up, but the actual thing one signs says:
 
I understand that I must provide all the information requested in this application and I certify that such information is accurate. I authorize you to verify the information on this application and to receive and exchange information about me including requesting reports from consumer reporting agencies. If I ask whether or not a consumer report was requested, you will tell me, and if you received a report, you will give me the name and address of the agency that furnished it. I authorize you and your affiliates and subsidiaries to contact these sources for information at any time and to use any information obtained about me for marketing and administrative purposes.

Additional Cards: I have advised Additional Card applicant(s) that you may obtain, verify, exchange, and use information about them in the same manner as described above, that they may be responsible for payment of their own charges if I fail to pay them, and that their own credit records may be affected by non-payment of the account. I understand that Additional Card(s) will not be issued to me if I have an unsatisfactory account with American Express or if the Additional Card applicant(s) have ever had an unsatisfactory account with American Express
.



The issue here is simple, an AU does not sign something this.
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
† Credit cards for FICO Score ranges: The score ranges are guidelines based on actual applicant approvals and having a FICO Score in a particular range does not guarantee you will be approved for credit cards recommended in that range.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.