Posts Tagged ‘FCRA’
What must the Consumer Reporting Agency forward to a furnisher?
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
CONSUMER REPORTING AGENCY REINVESTIGATIONS and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to conduct a reinvestigation and the procedures around that reinvestigation.
The section that discusses the requirements for reinvestigation of a disputed item is 15 U.S.C. §1681i.
As usual, we start with the statute. Please note that we will only be reviewing the section on reinvestigations, so the rest of the section will not be reprinted or discussed.
(2) Prompt notice of dispute to furnisher of information
(A) In general
Before the expiration of the 5-business-day period beginning on the date on which a consumer reporting agency receives notice of a dispute from any consumer or a reseller in accordance with paragraph (1), the agency shall provide notification of the dispute to any person who provided any item of information in dispute, at the address and in the manner established with the person. The notice shall include all relevant information regarding the dispute that the agency has received from the consumer or reseller.
(B) Provision of other information
The consumer reporting agency shall promptly provide to the person who provided the information in dispute all relevant information regarding the dispute that is received by the agency from the consumer or the reseller after the period referred to in subparagraph (A) and before the end of the period referred to in paragraph (1)(A).
What does this mean for you?
That the consumer [credit] reporting agency must forward the information that you provide to them on to the furnisher. It is not enough for them to take your dispute, and communicate the substance, but they must actually forward all the relevant information.
For example, if you dispute that an item (tradeline) on your credit file (credit report) is yours, they should send a copy of your dispute to the furnisher, so that the furnisher can compare signatures. The key to an account that is identity theft account is that someone else took your name, and social security number, and signed their signature. Their signature will not be the same as yours. If the furnisher has a copy of the signature they can look and compare, but if the consumer (credit) reporting agency does not send them a copy, they cannot compare.
Our advice is to send a separate dispute letter to the furnisher of the information, because the nature of the dispute is not always easy to distill into a dispute form. If you let the furnisher know, AS WELL AS THE CONSUMER REPORTING AGENCY, then there is an ability to actually review documents.
Note that there is no private right of action to sue a furnisher for not investigating when you directly dispute, but, it is an additional source of information that they should consider. See, eg: Alabran v. Capital One, E.D. VA, 3:04-cv-935, 12/8/05 (document 87).
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
Duty to Reinvestigate by the Consumer Credit Reporting Agencies
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
CONSUMER REPORTING AGENCY REINVESTIGATIONS and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to conduct a reinvestigation and the procedures around that reinvestigation.
The section that discusses the requirements for reinvestigation of a disputed item is 15 U.S.C. §1681i.
As usual, we start with the statute. Please note that we will only be reviewing the section on reinvestigations, so the rest of the section will not be reprinted or discussed.
(a) Reinvestigations of disputed information
(1) Reinvestigation required
(A) In general
Subject to subsection (f) of this section, if the completeness or accuracy of any item of information contained in a consumer’s file at a consumer reporting agency is disputed by the consumer and the consumer notifies the agency directly, or indirectly through a reseller, of such dispute, the agency shall, free of charge, conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate and record the current status of the disputed information, or delete the item from the file in accordance with paragraph (5), before the end of the 30-day period beginning on the date on which the agency receives the notice of the dispute from the consumer or reseller.
(B) Extension of period to reinvestigate
Except as provided in subparagraph (C), the 30-day period described in subparagraph (A) may be extended for not more than 15 additional days if the consumer reporting agency receives information from the consumer during that 30-day period that is relevant to the reinvestigation.
(C) Limitations on extension of period to reinvestigate
Subparagraph (B) shall not apply to any reinvestigation in which, during the 30-day period described in subparagraph (A), the information that is the subject of the reinvestigation is found to be inaccurate or incomplete or the consumer reporting agency determines that the information cannot be verified.
This section requires a Consumer Credit Reporting Agency to conduct a reinvestigation of their own if a consumer disputes the completeness or accuracy of an item in a credit file.
If a consumer disputes an item (called a tradeline) on a credit file (most people call it a credit report), they have to do certain things. One of the things they must do is an investigation of their own. They are not allowed to just believe the information that is passed to them by the furnisher of the information. This is called parroting, and courts around the country have said that this is prohibited. See, eg: Cushman v. TransUnion, 3rd Cir, 1997. They must look for themselves.
REMEMBER- The Fair Credit Reporting Act is about ACCURACY. If the item you are disputing is accurate and complete, there is no right to sue. This law is NOT strict liability- this means that you must show that they did something wrong, and that as a result of the fact that it is inaccurate and their reinvestigation did not solve the problem, that you suffered actual damages.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
What procedures to assure maximum possible accuracy must the agencies use?
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
MAXIMUM POSSIBLE ACCURACY and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to have a procedure to assure “maximum possible accuracy”.
The section that discusses the requirements for maintain a credit file is 15 U.S.C. §1681e subsection [b].
As usual, we start with the statute. Please note that we will only be reviewing the section on maximum possible accuracy, so the rest of the section will not be reprinted or discussed.
(b) Accuracy of report
Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.
Last time, we talked about Maximum Possible Accuracy for the Fair Credit Reporting Act.
But that is not all. The code says they must have a PROCEDURE TO ASSURE Maximum Possible Accuracy.
This means that they have to think about what is reported, and have a system to know that it is inaccurate.
In each of these cases, the key thing is that the information is inaccurate. Remember, the Fair Credit Reporting Act can only help fix problems of false, inaccurate information. If the information is true, you cannot remove that information, no matter how much you might try.
So what would be a valid procedure?
For example, as the recent consent order in the White/Acosta v. Equifax, TransUnion and Experian cases, has shown, if a consumer files for Bankruptcy, they must change the reporting WITHOUT the intervention of the creditors. So even if your creditors still think update and show that you still owe, they should show that the account is Discharged in Bankruptcy.
They know that they have a problem with mixing credit files up. They have known for several years. They are supposed to be able to keep your file separated, and they know it. That would be another example.
The problem gets stickier when the account is an ID Theft account. How can they know? Maybe, if the account comes with a report that you live at a different address? That should trigger someone looking at the file more closely.
The short of this is that they must actually look at the accounts, and have a way to assure that the information that they are disseminating is accurate to the fullest extent.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
Maximum Possible Accuracy requirement of the Fair Credit Reporting Act
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
MAXIMUM POSSIBLE ACCURACY and The Fair Credit Reporting Act
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act requires the Credit Reporting Agencies, or Consumer Reporting Agencies to have a procedure to assure “maximum possible accuracy”.
The section that discusses the requirements for maintain a credit file is 15 U.S.C. §1681e subsection [b].
As usual, we start with the statute. Please note that we will only be reviewing the section on maximum possible accuracy, so the rest of the section will not be reprinted or discussed.
(b) Accuracy of report
Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates.
The key term here is that the Fair Credit Reporting Act regulates information that is about you by making it illegal to report inaccurate or outdated information.
So, what is inaccurate?
- Not your account (you never opened or used the account, etc.)
- Illegal use of your account (someone charged something to your account but it was not you)
- Wrong status (Bankrupt, they changed the age of the account, you were never late, etc.)
NOT YOUR ACCOUNT
This comes in 2 major varieties, with some minor variations.
- Identity theft
- Mixed credit file
Identity theft is where someone other than you opens an account in your name, using your name, your social security number, your date of birth, but you never see the account, the card, or the money.
Mixed credit file is where your name is similar to someone or your social security number is similar to someone. In this circumstance, the credit bureaus cannot tell the difference between the 2 of you, so what is on 1 is on both.
ILLEGAL USE OF THE ACCOUNT
This is where you have a credit card with a company, but someone steals your card, and uses that card to purchase things for themselves. This is classic credit card theft.
Another example is where you have the account, but someone steals the card number, and uses that card number to purchase things for themselves or others. This is the newer version of credit card theft.
WRONG STATUS
This is the situation of a paid off account that shows that you owe money.
This can also be an account that shows that you were late when you never were. There are a number of credit card companies that play games, and they might receive the money on the 10th, when the payment is due, but they don’t process the check until after the 20th when it is late. Then they report that you were late, and charge you a late fee. A secret about me —First Tennessee Bank did this to me in the 80s and 90s, and this is one of the reasons I went into consumer law. Another example is mortgage companies that do the same thing.
Bankrupt accounts reporting as still due and owing, or charged off. This is a common problem.
Accounts that are delinquent often go to Debt Collectors. Sometimes they change the date the account first became delinquent, which is the key date the Credit Reporting Agencies use to determine when the account comes off your credit report. Most delinquent accounts can only be reported for 7 years, but some can be reported for 10 (for example Bankruptcy) and others can be reported for as long as they are outstanding (for example tax liens). There is no time limit for a good account to be reported.
If you have been damaged by any of these actions, you could be entitled to recover actual damages, attorney fees and costs, and in the right circumstances, punitive damages are available. Getting to punitive damages is very hard, so we usually tell clients that punitive damages are likely to be limited, if available, in their case.
In each of these cases, the key thing is that the information is inaccurate. Remember, the Fair Credit Reporting Act can only help fix problems of false, inaccurate information. If the information is true, you cannot remove that information, no matter how much you might try.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230
What are the permissible purposes to access a credit report?
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
YOU MUST BE A VIRGINIA RESIDENT.
If you are not a Virginia Resident, click here to find a lawyer near you.
The Fair Credit Reporting Act is designed to protect consumers from inaccurate or outdated information on credit reports.
ACCESS OF CREDIT REPORTS- PERMISSIBLE PURPOSES
All references to code sections are courtesy of the Legal Information Institute at Law.Cornell.edu.
The Fair Credit Reporting Act allows certain people to access your credit file or credit report, under certain circumstances.
The section that discusses the permissible purposes for accessing a credit file is 15 U.S.C. §1681b.
As usual, we start with the statute. Please note that we will only be reviewing the section on permissible purposes, so the rest of the section will not be reprinted or discussed.
(a) In general
Subject to subsection (c) of this section, any consumer reporting agency may furnish a consumer report under the following circumstances and no other:
(1) In response to the order of a court having jurisdiction to issue such an order, or a subpoena issued in connection with proceedings before a Federal grand jury.
(2) In accordance with the written instructions of the consumer to whom it relates.
(3) To a person which it has reason to believe—
(A) intends to use the information in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; or
(B) intends to use the information for employment purposes; or
(C) intends to use the information in connection with the underwriting of insurance involving the consumer; or
(D) intends to use the information in connection with a determination of the consumer’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant’s financial responsibility or status; or
(E) intends to use the information, as a potential investor or servicer, or current insurer, in connection with a valuation of, or an assessment of the credit or prepayment risks associated with, an existing credit obligation; or
(F) otherwise has a legitimate business need for the information—
(i) in connection with a business transaction that is initiated by the consumer; or
(ii) to review an account to determine whether the consumer continues to meet the terms of the account.
(G) executive departments and agencies in connection with the issuance of government-sponsored individually-billed travel charge cards.
(4) In response to a request by the head of a State or local child support enforcement agency (or a State or local government official authorized by the head of such an agency), if the person making the request certifies to the consumer reporting agency that—
(A) the consumer report is needed for the purpose of establishing an individual’s capacity to make child support payments or determining the appropriate level of such payments;
(B) the paternity of the consumer for the child to which the obligation relates has been established or acknowledged by the consumer in accordance with State laws under which the obligation arises (if required by those laws);
(C) the person has provided at least 10 days’ prior notice to the consumer whose report is requested, by certified or registered mail to the last known address of the consumer, that the report will be requested; and
(D) the consumer report will be kept confidential, will be used solely for a purpose described in subparagraph (A), and will not be used in connection with any other civil, administrative, or criminal proceeding, or for any other purpose.
(5) To an agency administering a State plan under section 654 of title 42for use to set an initial or modified child support award.
(6) To the Federal Deposit Insurance Corporation or the National Credit Union Administration as part of its preparation for its appointment or as part of its exercise of powers, as conservator, receiver, or liquidating agent for an insured depository institution or insured credit union under the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.] or the Federal Credit Union Act [12 U.S.C. 1751 et seq.], or other applicable Federal or State law, or in connection with the resolution or liquidation of a failed or failing insured depository institution or insured credit union, as applicable.
So there are several reasons why an entity can get your credit file. Obviously, if you give them permission, or a judge gives permission, it is permissible. That requires little explanation.
But section 3 requires a bit more explanation.
They can access your report if you are applying for credit, or someone is collecting, for a background check for employment, or insurance underwriting, or for investment purposes. They can look if they have a legitimate business need, for a credit transaction or a review of a credit transaction.
The rest of the section is about child support agencies.
But the key factor is that for most purposes, they can only look if there is an underlying credit transaction.
But the key factor is CREDIT TRANSACTION. In a recent case, the 9th circuit court of appeals (the 9th circuit covers Alaska, Hawaii, California, Washington, Oregon, Arizona, Nevada, Montana and Idaho) held that a parking ticket, or traffic ticket was not a credit transaction, so a collector who was using the credit report to collect could not get access. Pintos v. Pacific Creditors Ass’n, 565 F.3d 1106 (9th Cir., 2009). “Because the current case involves neither a transaction for which Pintos sought credit nor the collection of a judgment debt, we conclude that § 1681b(a)(3)(A) did not authorize PCA to obtain the credit report on Pintos.” Pintos at 1110.
These are the reasons that the law allows. These are ALL of the reasons the law allows.
Now it gets interesting to look at the question of can a creditor or collector look at a credit report if the underlying debt is paid, or discharged.
There is a court of appeals decision that says that a former creditor who was owed money, but is now paid, does have a permissible purpose. Wilting v. Progressive County Mut. Ins. Co., 227 F.3d 474, 476 (5th Cir., 2000). There is another court of appeals case that says that a closed account no longer has a permissible purpose. Levine v. World Financial Network Nat. Bank, 437 F.3d 1118 (11th Cir., 2006). It is possible to distinguish a paid, closed account from an account that is paid, but with a status that is just inactive. As a result, impermissible access must be monitored.
A creditor who has been discharged is a horse of a different color. If they are accessing the report for the purposes of collection, they are knowingly collecting on a discharged debt. If they are accessing the report for a purpose other than collection, they need to show a new application, or they do not have a permissible purpose. So, they are either collecting on a discharged debt, or they do not have a permissible purpose. Collecting on a discharged debt is prohibited by the Bankruptcy code. Not having a permissible purpose is prohibited by the Fair Credit Reporting Act. In chess, this is called a fork. They are losing one or the other.
If someone has been looking at your credit, and does not have a permissible purpose, you may have a right to sue them. Contact us, for a free consultation, and lets discuss who is looking, and why.
If you have been damaged by any of these actions, you could be entitled to recover actual damages, attorney fees and costs, and in the right circumstances, punitive damages are available. Getting to punitive damages is very hard, so we usually tell clients that punitive damages are likely to be limited, if available, in their case.
If you have been impacted by anything we mentioned here, you can make an appointment to see us.
NO FEE IN YOUR FCRA CASE UNLESS WE RECOVER!!
OUR LEGAL FEES:
The rights afforded to you, as a consumer, under the FCRA and the FDCPA means that a corporation or party who has violated your rights may ultimately be made to pay for statutory damages, actual damages, and your legal fees. Therefore, if we agree to represent you in any case, you won’t pay any attorney’s fees unless we are successful and we recover on your behalf. We are here to serve and have assisted many consumers TO enforce their legal rights. Let us try and see if we can help you too. That means you pay no fee in your case unless we recover.
Contact us by e-mail or by telephone or fax or US Mail.
You can call us: 804.673.4358
You can fax us: 804.673.4350
You can contact us by US MAIL:
Krumbein Consumer Legal Services, Inc.
1650 Willow Lawn Drive
Suite 300
Richmond, VA 23230