Is stopping payment on a check considered fraud if the company did not fulfill the contract?

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Is stopping payment on a check considered fraud if the company did not fulfill the contract?

We paid for additional insurance in our deposit for a moving company to move our items. They damaged many of the items, but refused to leave the information for the insurance, overcharged the balance due. My husband paid them anyway. When I returned home to discover this, I called and told them if they did not rectify the situation, I would stop payment on the check. They did not call by my deadline, so I stopped payment as a joint account holder. I highly suspected that they had no insurance or would never give me the info if they did. As it turns out, they don’t have it. Is this legal?

Asked on August 10, 2011 Virginia

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

It is not legal for this company to not have insurance and definitely fraudulent for it to refuse to give you its information and overcharge you for services not given and for damages it caused. This is the whole point of having insurance when hiring a moving company. So at this point, you want to file a complaint with your state attorney general and any agency your state has to license these individuals and then consider whether these agencies can get your money back for you quickly. If they cannot promise this, file the small claims action to at least preserve your rights in the court of law.


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