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Brandon M.
Brandon M., Counselor at Law
Category: Legal
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Experience:  Attorney experienced in numerous areas of law.
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i found a company online that offererd business loans with

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i found a company online that offererd business loans with no personal guarentes. i signed up a client fortheir services. they took $7500 for their services and never delivererd i refunded the clien the fee he paid to my company ($1400) and offererd him credit at my company for the $7500 his lawer called me on friday and said that i am responsibile for the money that i passed on to that scam company and i legally have to pay him back. i personnally lost close to $30,000 with that company and i dont have money to pay him the $7500 which i dont believe i owe him. what i need to know is if there is a legal basis where i would be responsibile for the money even if the contracts he signed were with that company not mine. btw he paid me in cash
Submitted: 6 years ago.
Category: Legal
Expert:  Brandon M. replied 6 years ago.
What is your business relationship to the client? In other words, what services did you provide to the client that resulted in you signing them up for this loan?
Customer: replied 6 years ago.
i own a credit repair company and the client asked me when i met with him for a intial consultation he told me he was looking for a business loan at that time i had found this loan company a week before and had submitted another client for their services. i explained to this client about the program they offer he said he wants to go ahead with it i told him their fee that they need to do the loan was $7500 and mine would be $1400 for reffering him to them. i submitted the app and the docs and after a week they approved him and sent me his contract for him to sign and send back along with their fee. well after a couple of weeks relized it was a scam. they sent him a refund by check and it bounced. so i gave him a refund of the $1400 and told him the rest althogh i dont have it i will give him a credit toward other services. and then his attorney called me friday and told me i have to by law pay him back the money..
Expert:  Brandon M. replied 6 years ago.
Hello again:

I have to be honest and let you know that I am generally inclined to agree with the client's attorney, but I do not believe that it is as clear cut as I am sure that attorney has presented the law to you and it depends very much on the details.

Under any scenario, the client paid you $1,400 in exchange for a referral to a company that would assess his risk in contemplation of a loan. You failed to perform this task (because the company just took his money), so you were right in refunding the client's money.

The question then becomes what sort of explicit or implicit assurances were made to the client. If the client was assured that the company was legitimate and relied on your assurance, or if (as the client's agent) you recommended this company and the client relied on your expertise, you would ordinarily be responsible for the full amount. If neither of these scenarios played out, you would ordinarily not be liable to the client for the $7,500.

Had you not taken or charged the fee, my opinion would probably be different.

Maybe something else can still be worked out; perhaps, for example, you can work out a repayment schedule or a situation where you pay back 1/2 and give the client credit toward other services for the remaining 1/2. The expression is that you can't get blood from a turnip... it is one thing to have the law on your side, but being right doesn't mean that there is money to get back.

If the client wanted to receive the full amount, he would have to initiate a lawsuit which is expensive in and of itself, so it would probably not be worth it to pursue if he could get at least something back from you without litigation, and there is always the chance that he would not be able to make his case or persuade a jury that he was entitled to the full amount.

I realize that this is probably not what you had wanted to hear, but I do hope that you understand my philosophy that I cannot help customers unless I give them the truth, regardless of whether it is "good" news or "bad" news. Thank you, XXXXX XXXXX me know if I may be of further assistance.
Customer: replied 6 years ago.
i appreciate your honesty. but do u think criminal charges can arise from this case by him saying that i commited fraud since i was an agent of that company? even though i wasnt an official agent?
Expert:  Brandon M. replied 6 years ago.
No way. Criminal charges against you are not a possibility. It would be strictly civil. You and your client are both victims here; you are not criminally responsible for what happened.
Customer: replied 6 years ago.
ok one more question i had . i wasnt clear before about the $1400 that i recieved wasnt for the loan it was for other credit related services performed succsesfully i just refunded it out of good will.i as supposed to get percentage of the loan after he recieved it. does that change the sitchuation in any way??
Expert:  Brandon M. replied 6 years ago.
It does not. It was the right thing to do to refund the money, but it does not change the outcome.
Customer: replied 6 years ago.
Thanks again for your help. should i call the attorney back or wait for him to call me. when i spoke to him on friday i said i need over the weekend to think about it. and i will call back monday. do u think its better if i wait he should call me?
Expert:  Brandon M. replied 6 years ago.
I am sorry; for some reason, my answer did not post. It really does not matter who calls who first; personally, I would let the attorney call me.

Edited by B. T. Mayer, Counselor at Law on 2/1/2010 at 7:01 AM EST
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