AMEX Debt Sent to CA - Need Guidance

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Hi, I'm brand new to the boards. Great info here. Hoping to get some help with a small dilemma. My son (age 23) got an Amex Platinum card a couple of years ago. He cancelled the card about a month ago and then used the card on a Blockbuster discount program application thinking that the charge (for $10) wouldn't go through (but it did) and Amex slapped him with their $395 membership fee.

My son has been disputing the fee with Amex ever since and now Amex sent over to CA who has started harassing him on the phone.

Son wants to pay the whole thing and forget about it. I told him to hold on, let's figure this out so you don't ding your credit report.

Experian credit report shows Amex account status as in collections since Sept 06 for $770 - although my son just paid $300+ to Amex a couple of weeks ago. No CA is listed on the credit report. We are in process of getting credit reports from other 2 CRA.

He has not DV the CA yet. Should we wait and see how his other CRs look? Should we contact AMEX? Although he recently got a statement from Amex stating "contact your collection agency for account information, this is not a bill." It was a statement saying $425 was owed ($395 plus late fee).

I was hoping that he could settle for about $125 with the CA and get status changed to Paid as agreed. But, since the account is listed as Amex on the CR and not as the CA I am sure the CA will say they can't change anything on the Amex account listing.

Long story short - what is best way to get account to show paid as agreed on his credit report - and is there a way to do that with a settlement?

Thanks if you have read this far - appreciate any pointers.

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*shaking head*--unbelievable

If the card had been cancelled, why did Amex approve the transaction? When the clerk at Blockbuster was processing the transaction, "cancelled" should have popped up in his little window. The credit industry is out of control.

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