The U.S. District Court for the Western District of Wisconsin recently held that Synchrony Bank did not violate the Fair Credit Reporting Act (“FCRA”) when it mistakenly requested a consumer’s credit report. In Carlson v. Synchrony Bank, No. 21-cv-077-wmc, 2022 WL 1302841 (W.D. Wis. May 2, 2022), Synchrony requested plaintiff’s credit report after a third party accidentally provided plaintiff’s social security number in connection with a credit application. When plaintiff learned that the account was opened, he contacted Synchrony to advise that he did not open the ...
Following the Supreme Court’s decision in Spokeo, Inc. v. Robins, 578 U.S. 330 (2016), federal courts have continued to examine what is an injury in fact under the Fair Credit Reporting Act (“FCRA”). On April 4, 2022, the Eighth Circuit provided instructions on remand to dismiss a FCRA class action due to lack of standing in Schumacher v. SC Data Ctr., Inc., --- F.4th ----, 2022 WL 997742 (8th Cir. Apr. 4, 2022). Ria Schumacher applied for a position at SC Data and during the application process answered “no” to a question asking if she had been convicted of a felony. In connection ...
In Woods v. LVNV Funding, LLC, --- F. 4th --- (2022), the Seventh Circuit Court of Appeals affirmed the dismissal of FDCPA and FCRA claims based upon the defendants’ collection and reporting of a fraudulently opened account.
The plaintiff, Kevin Woods, alleged someone opened an American Airlines credit card account in his name and purchased a one-way flight. American closed the account and sold it to LVNV Funding, LLC, which placed it with Resurgent Capital Services, L.P. for collection. When Woods received collection letters, he disputed the debt and told Resurgent the account ...
The U.S. District Court for the Middle District of Alabama joined a growing number of courts dismissing FCRA claims based upon a furnisher’s alleged failure to remove an “account in dispute” notation from consumer credit reports. In Griffin v. Experian Information Solutions, Inc., No. 1:20-cv-801-RAH-SMD, 2021 WL 3782141 (M.D. Ala. Aug. 26, 2021), the plaintiff had four accounts that were marked as “in dispute.” The plaintiff decided to dispute the “account in dispute” notation by contacting consumer reporting agencies (CRAs) rather than the furnishers ...
The Fair Credit Reporting Act (FCRA) was enacted to promote the accuracy, fairness, and privacy of information maintained by Consumer Reporting Agencies (CRAs). In addition to imposing duties on the CRAs, it requires furnishers of information to provide accurate and complete information to the CRAs and to investigate any consumer disputes regarding the accuracy of that information. Increased claims of identity theft by consumers have given rise to more disputes that accounts are not accurately being reported as belonging to those consumers. These “identity theft” ...
On July 6, 2021, the Eleventh Circuit issued a per curiam opinion affirming the Southern District of Alabama’s entry of summary judgment in the lender’s favor on a plaintiff’s claim under the Fair Credit Reporting Act (“FCRA”), therein finding that the district court did not err in dismissing the claim for willful violation of the FCRA because the plaintiff failed to establish that the lender’s interpretation of its obligations under the statute was objectively unreasonable.
In Ajomale v. Quicken Loans Inc., –– Fed Appx. ––, 2021 WL 2799939 (Jul. 6, 2021), the ...
The ruling by the Eleventh Circuit Court of Appeals in Richard Hunstein v. Preferred Collection and Management Services, Inc. raises significant concerns for debt collectors who use vendors for mailing and other types of services that require the sharing of information relating to consumer debts. By ruling that such arrangements can violate the prohibition on sharing information about consumer debts with third parties under section 1692c(b) of the Fair Debt Collection Practices Act ("FDCPA"), the panel’s decision has forced many debt collectors to rethink existing business ...
On April 13, 2020, twenty-three Attorneys General sent a joint letter urging the CFPB to withdraw its recent guidance on Fair Credit Reporting Act (FCRA) requirements during the COVID-19 crisis. The request came from Attorneys General of Pennsylvania, California, Colorado, the District of Columbia, Hawaii, Illinois, Iowa, Maine, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Puerto Rico, Rhode Island, Vermont, Virginia, Washington, and Wisconsin.
In the letter, the Attorneys General responded to the CFPB’s April 1 ...
On Friday, March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), an emergency spending bill providing $2 trillion in relief to individuals and businesses who have or will suffer negative economic effects of the COVID-19 pandemic.
Credit Reporting
The CARES Act amends the Fair Credit Reporting Act by creating new reporting rules in those instances where a furnisher makes an “accommodation,” which is defined as “an agreement to defer one or more payments, make a partial payment, forbear any delinquent amounts ...
On May 22, 2018, the U.S. House of Representatives passed S. 2155, titled The Economic Growth Regulatory Relief and Consumer Protection Act ("Act"). This was the penultimate legislative hurdle for the Act, which now only requires the President's signature to become law. The President is expected to sign the Act into law in the very near future.
The Act has a number of important regulatory relief provisions governing the lending and banking industry including:
- Reduces the level of regulatory oversight by the Financial Stability Oversight Counsel (FSOC) for banks with between ...
In Pedro v. Equifax, Inc., --- F.3d ---, 2017 WL 3623926 (11th Cir. 2017), the Eleventh Circuit held that it was not objectively unreasonable for TransUnion, LLC to interpret section 1681e(b) of the Fair Credit Report Act ("FCRA") to allow it report an account belonging to an authorized user.
Kathleen Pedro filed a putative class action alleging that TransUnion willfully violated section 1681e(b), which requires consumer reporting agencies to "follow reasonable procedures to assure maximum possible accuracy," when it reported her parents' credit card account for which she was an ...
Since the Constitution was ratified, 226 years ago, potential plaintiffs have been required to first establish that they have a "case or controversy" before a court can consider the merits of any legal claim. As the U.S. Supreme Court has phrased it, "the person seeking to invoke the jurisdiction of the court must establish the requisite standing to sue." Whitmore v. Arkansas, 495 U.S. 149, 154 (1990). There are three components of standing:
1) the plaintiff has suffered an "injury in fact" that is (a) concrete and particularized and (b) actual or imminent, not conjectural or ...
The U.S. District Court for the Western District of Pennsylvania recently held that obtaining a credit report for assistance in the collection of a debt constitutes a permissible purpose under § 1681b(a)(3)(A) of the FCRA. In Fritz v. Capital Management Services, LP, No. 2:12-cv-1725, 2013 WL 4648370 (W.D. Pa. Aug. 29, 2013), the plaintiff filed suit against the defendant debt collector alleging violations of the FCRA after the defendant inquired into her credit history upon placement of plaintiff's account with the defendant. It was undisputed that the plaintiff never ...
Judge Donald Middlebrooks recently dismissed a plaintiff's "permissible purpose" claim under the Fair Credit Reporting Act ("FCRA") where the alleged facts showed that the defendant/creditor was attempting to collect a debt and had a good faith belief that the account belonged to the plaintiff. In Little v. Asset Acceptance, Case No. 9:12-cv-81116 (S.D. Fla.), Carole Little filed suit against Asset Acceptance, LLC, claiming that Asset had no permission to access her credit report, that she had never applied to Asset for credit, and that she does not maintain a credit account with ...
The Tenth Circuit recently held that a borrower presented sufficient evidence of actual damages to sustain a FCRA claim against a loan servicing company. The Tenth Circuit also affirmed the district court's decision to dismiss the FCRA claim with respect to a willful violation and the FDCPA claim. In Llewellyn v. Allstate Home Loans, Inc., --- F.3d ---, 2013 WL 1238615 (10th Cir. Mar. 28, 2013), the plaintiff filed suit against a loan servicing company and law firm retained to commence foreclosure proceedings alleging violations of the FDCPA, FCRA, and state law. The district court ...
An Alabama federal court recently rejected an attempt by certain merchant defendants to dismiss claims brought under the Fair and Accurate Credit Transactions Act ("FACTA"), 15 U.S.C. § 1681, et seq., on the basis of the plaintiffs' failure to allege actual damages. In the case, Amason v. Kangaroo Express, the plaintiffs sued merchants with whom they had transacted business, alleging that the defendants willfully violated FACTA by printing more than the last five digits of the plaintiffs' credit and debit card numbers on receipts. No. 7:09-2117-RDP, 2013 WL 987935, at 3 (N.D ...
A federal court in Washington last week declined to grant summary judgment in favor of OneWest Bank on a Fair Credit Reporting Act ("FCRA") claim where OneWest did not fully investigate account disputes received directly from the consumer and not from a consumer reporting agency. In McDonald v. OneWest Bank, FSB, Case No. C-10-1952RSL, 2013 WL 858187 (W.D. Wash. Mar. 7, 2013), the plaintiff/consumer notified three consumer reporting agencies ("CRAs") he disputed a debt OneWest was reporting on his credit report. He also sent letters directly to OneWest outlining the specific ...