September 23rd, 2013
Credit Reports Affect the Economic Health of American Families: Jason Causey Discusses Your Legal Rights
Approximately 200 million Americans have credit histories on file with the three major credit bureaus (Experian, Equifax and TransUnion), and these bureaus
generate and sell more than one billion credit reports each year. Credit reports play a critical role in the economic health of American families. At least a fair credit history is often necessary for consumers to obtain credit, and at a reasonable price. Credit reports are also used by employers to make employment decisions, landlords to make rental decisions, utility providers to establish accounts, and insurers to set premium rates.
Because of the importance of credit reports, credit bureaus have a legal duty of maintaining consumer information to the "maximum possible accuracy." Nevertheless, inaccuracies and errors plague credit reports, with estimates of serious errors affecting up to 25% of all reports. The primary protection for consumers involves a dispute process to correct inaccuracies that is mandated by the Fair Credit Reporting Act. Unfortunately, the process has become a travesty, with the credit bureaus conducting only perfunctory investigations.
The basic process involves a consumer submitting a dispute in writing, on-line or by telephone. Bordas & Bordas recommends the dispute be submitted in writing - this way you can submit proof of the inaccuracy with your dispute - and sent to the responsible credit bureaus by certified mail. In general, the bureaus are supposed to review the dispute and can either accept the consumer's dispute as true and repair or delete the inaccuracy or verify the reporting by forwarding the dispute to the furnisher (i.e., creditor, etc.) of the information for its review and comment. The credit bureau should then carefully consider all relevant information in resolving the dispute.
Years of litigation and other independent investigations have shown that consumer disputes are given little attention by the major credit bureaus, who are known to pay foreign workers as little as $0.57 to process each dispute. Typically, these workers reduce detailed written disputes that include pages of information into two or three digit codes that are sent to the creditors or furnishers to verify through automated processes. Often little attention is given to the coded dispute and inevitably the wrongfully reported information is verified again through automated processes. Thus, inaccurate information and errors remain despite the consumer's best efforts. When situations like this occur, the consumer may bring a lawsuit against the credit bureaus for failing to meet their obligation of assuring the maximum possible accuracy of consumer reports and failing to conduct a reasonable and prudent investigation. Likewise, the consumer has a legal claim against the furnisher or creditor for failing to conduct a reasonable investigation upon receiving notice of the consumer dispute from one or more credit bureau. However, the consumer must make the dispute through the credit bureaus opposed to directly with the furnisher or creditor in order to bring a lawsuit under the Fair Credit Reporting Act.
Lawsuits under the Fair Credit Reporting Act can lead to large recoveries for the consumer who was harmed by false reporting, as the consumer may be entitled to: actual damages, which include financial losses and annoyance, aggravation, inconvenience and emotional distress type damages; punitive damages when warranted; and an award of the consumer's attorney fees and costs incurred in the litigation. Bordas and Bordas is currently interested in representing consumers who have been subjected to false credit reporting. Those consumers experiencing
false credit reporting are often victims of identity theft, fraud or the credit bureaus mixing the consumer's credit file with another consumer of a similar name or with a similar social security number. If you have been struggling with an inaccurate credit report, please give us a call for a free evaluation.
This blog entry is for informational purposes only and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Bordas & Bordas and the user or browser.