default on a business cash advance

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default on a business cash advance

i tiook a business loan from a company tht loans you mopney bases on master card visa sales for 5000. i defaulted because i am out of business. but the collection agency prelegal is threating criminal and civil because the electronicpayments they tried to debit out of my bank account were returned nsf stop pay then account closed..can they hold me criminally responsible in nj the loan co was in new york

Asked on May 1, 2009 under Criminal Law, New Jersey

Answers:

LAR, Member CA State Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

First, if your situation is pre-legal, it is not clear how the collection agency, as opposed to the company that loaned you the money, could get access to your bank account to deduct money for this loan money that you owe to another company.   The collection agency can't sue you just because you owe money - it is only the entity that owns the debt that can sue - your question is not clear as to whether the loan company still owns the loan or the collection agency purchased this debt and is collecting it on its own behalf.   Second, on the facts you present, it does not sound like you would be criminally responsible because it does not appear that you did anything other than have insufficient funds and then closed the account.  If your business was not incorporated, you could be personally responsible for the debt, but again, based on your facts, there is no criminal responsibility. 


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