Closed For Business?

Here's what you can do when a company skips town with your money

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Six weeks ago, you paid an $800 deposit to the XYZ Carpet Mart for new living and dining room carpeting that was supposed to be delivered within a month. You go to the store and see that the windows are opaque and the doors are boarded up. A million questions go through your mind, but what you really want to know is how to get your money back. If you’ve kept your receipts and invoices, you have a good starting point. Now, take the following steps to help you recover what’s owed to you.

Neighboring businesses in the area can give you clues about the store. Here are some questions to ask: Can you remember when/why it closed? Did the business relocate and leave a forwarding phone number or address? You may be surprised at what you can find out by word of mouth.

If that fails, call the state Office of Corporations if you suspect the business is incorporated, or if you found a corporate name on your receipt. Search the corporate owners by name; they could have started a new company.

Call or write to the postmaster general of your local post office for the forwarding address of the business or the owners. They could have moved and failed to notify customers.
If you’re still stuck and the amount of money is worth it to you, hire a detective to perform a “skip trace,” a search of sources that are most likely to give information on that company. The search will probably cost about $150, and should give you current addresses.

Examine the reverse side of your canceled check to find out where your money was deposited. If you want to sue, the account can be attached before trial to secure any potential judgment you might win in court.

Call the bankruptcy court to find out if the business has filed for bankruptcy. A review of court papers will reveal if it has any valuable assets. If you find none, stop here. You will probably not recover the money you lost.

If you find there are assets, consider the time and financial cost of recovering your loss. You could hire an attorney on a contingent basis if you feel the amount owed is worth it. Note that attorneys will take these cases only if they are assured of recovering their fees.

If you were unsuccessful, or don’t have time, a detective can do an asset search. Be sure to get an estimate of fees before hiring a detective.

If no bankruptcy occurred and there was no intent to cheat you, just a lack of communication, send the store owners a certified letter, giving them 10 days to deliver your carpet or a complete refund, whichever you now want. Without delivery or refund, you may sue them yourself in small claims court (only if there is no bankruptcy). You might recover multiple damages and your costs, with proof of consumer protection violations.

If there is

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