AT&T Telling Me iPhone I Purchased is Locked

I recently purchased an iPhone XS Max from an online market. The seller claimed that the phone was clean, clean IMEI, not blacklisted or iCloud locked, paid off, etc. I did some research to check the IMEI status and it appeared to be clean, and there was nothing indicating the phone had been reported lost or stolen. I bought the phone for my son, who uses AT&T Prepaid cards. The phone is not unlocked and is configured for use with AT&T. However, when my son went to the AT&T store to set up and start using this new phone, the store told him that the previous owner did not finish paying off the phone and that it was being blocked by AT&T. I have since tried to reach out to the seller to dispute the sale of the phone, and they have disappeared and blocked all communication from me. I would like to know what my options are for getting this phone to a state that it can be used again?