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Credit Report and Collection Abuse


TILA, RESPA and FCRA . . . Oh my!

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Cole v. Federal National Mortgage Association, et al., 2017 WL 623465 (D. Md. February 13, 2017) The Plaintiff, Ms. Cole, brought a case against Fannie Mae and Severus alleging a number of claims under the Truth in Lending Act(TILA), the Real Estate Settlement Procedures Ac(RESPA)t, the Maryland Consumer Debt Collection Act(MCDCA), the Maryland Consumer Protection Act(MCPA), and the Fair Credit Reporting Ac(FCRA)t. Unlike most pro se Plaintiffs, who generally strike out when throwing a bunch of these claims against the wall, Ms. Cole hits a home run on every one and it is impressive to see. In 2007, the Plaintiff and her late husband obtained a mortgage loan on the property from a non-party, Bank of America. Mr. Cole passed away in 2013 and Ms. Cole became the sole mortgagor of the property. Severus declared the loan in default in February of 2014 and mailed Ms. Cole a Notice of…Read More

Sovereign immunity applies to claims against the Government . . . Sometimes

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Robinson v. Pennsylvania Higher Education Assistance Agency, et al. 2017 WL 1277429 (D. Md. April 3, 2017) Plaintiff alleged that government student loans were fraudulently opened in his name and that he had only permitted Direct Loan to perform a credit check, not to open a loan account in his name. The parties dispute whether or not a “government or governmental subdivision or agency” in the definition of “person” includes the Department of Education, which is a federal agency. Under the doctrine of “sovereign immunities,” the United States is shielded from suit absent consent to be sued that is “unequivocally expressed.” United States v. Bormes, 133 S.Ct. 12, 16 (2012). A waiver of sovereign immunity cannot be implied and all ambiguities are resolved in favor of the Government. To date, neither the Supreme Court nor the Fourth Circuit has squarely ruled upon whether the FCRA waives sovereign immunity though the…Read More

Previous case establishing not inaccurate reporting by furnisher bars claim against CRA

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Alston v. TransUnion, LLC, 2017 WL 1628420 (D. Md. April 27, 2017) The Plaintiff, acting pro se, alleges that the CRA’s violated two provisions of the Fair Credit Reporting Act, 15 U.S.C. 1681e(b) and 15 U.S.C. 1681i(a)(1). The Plaintiff alleges that the CRA’s erroneously relied on the bare, unsupported statements of the furnisher to report that the Plaintiff’s account was delinquent and continued to rely solely on the reporting by the furnisher, in this case, Wells Fargo. The court, citing Dalton v. Capital Assoc. Indus., Inc., 257 F.3d 409 (4th Cir. 2001), pointed out that the Fourth Circuit has interpreted Section 1681e to include an inaccuracy requirement, such that in order to establish a violation of Section 1681e, a plaintiff must show both (1) the consumer report contained in accurate information and (2) the reporting agency did not follow reasonable procedures to assure maximum possible accuracy. Additionally, the Court noted…Read More

Claim against furnisher fails unless dispute made to Credit Reporting Agency

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Flax v. Navient Solutions, Inc., 2017 WL 1153889 (March 28, 2017 D. MD.) Judge Marvin J. Garbis Plaintiff checked his credit report and learned that his father had taken out three separate loans from Navient Solutions, Inc. In his name, without knowledge or consent of the Plaintiff by forging his signature. Included in the Plaintiffs Complaint was a Count for violation of the Fair Credit Reporting Act, Section 1681s-2(b). Under this section, those who furnish information to the credit reporting agencies have a responsibility to investigate the accuracy of reported information upon notice of a dispute. The Court cites the 4th Circuit opinion in Johnson v. MBNA Am. Bank, NA, 357 F.3d 426, 431 (4th Cir. 2004), which held that 1681s-2(b)(1) requires creditors, after receiving notice of a consumer dispute from a credit reporting agency, to conduct a reasonable investigation of their records to determine whether the disputed information can…Read More

Failure to pay mortgage does not releive mortgage companies of responsibilities under FCRA

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Mohamed v. Select Portfolio Servicing, Inc., et al, 215 F.Supp.3d 85 (Dist. D.C.) Mortgage was transferred among various servicers and various holders over the course of its life. The consumer/mortgagor, Mr. Mohamed, requested confirmation from his various servicers that they were entitled to payment on the note. Mr. Mohamed eventually stopped paying on the note (in fact, he didn’t make a payment for over five years), stating that his current servicer, EMC, had failed to establish it was the holder of the Note. Mr. Mohamed filed disputes with the credit reporting agencies (CRA’s) to dispute the delinquent reporting of the mortgage account. Chase, who was now the servicer, verified the account as accuratately reported as delinquent from April 2011 forward. After the dispute was sent, Chase sent a letter to Mr. Mohamed that Select Portfolio Servicing (SPS), Inc would be his new loan servicer. Mr. Mohamed again disputed the negative reporting of…Read More

Student Loan Collection Letter Violates FDCPA

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Bieber, ex al v. Pioneer Credit Recovery, Inc. (EDVA Case No. 1:16-cv-804, January 11, 2017) This was a class action that stemmed out of a collection letter sent by Pioneer alleging various allegations of false representations, false implications, and that Pioneer used unfair and unconscionable means to collect a debt, all violations under the Fair Debt Collection Practices Act, 15 U.S.C. 1692e et seq. The Court first tackled the issue of whether or not the Plaintiff has standing to sue under Article III, an issue recently addressed by the Supreme Court in Spokeo, Inc. V. Robbins. To that end, the Court noted that a plaintiff cannot allege a bare procedural violation, divorced from any actual harm, and satisfy the injury-in-fact requirement of Article III. However, the Court pointed out that the Supreme Court also held that “the violation of a procedural right granted by statute can be sufficient in some…Read More

Credit bureau fails to correct report after mortgage settlement

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Burke v. Experian Information Solutions, Inc., 1:10-CV-1064 AJT/TRJ, 2011 WL 1085874, at *4 (E.D. Va. Mar. 18, 2011) Mr. Burke had sued his mortgage servicer, Litton Loan Services, and reached a settlement whereby the servicer agreed to “delete the trade line” on Mr. Burke’s credit report. Later, when Mr. Burke obtained a copy of his credit report, he found that information relating to his mortgage remained on his credit report. Mr. Burke sent a dispute to Experian stating that the entry should not be on the credit report and invited Experian to call him.  Mr. Burke was unable to provide additional information due to a confidentiality clause in the settlement agreement with Litton Loan. Experian sent the dispute to Litton Loan, who incorrectly confirmed that the loan should remain. Experian conducted no investigation and simply reported back what was reported to it by Litton. Mr. Burke again disputed the reporting…Read More

State law defamation preempted except in the case of malice or willful intent to injure

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Ross v. FDIC, 625 F.3d 808 (4th Cir 2010) The Plaintiff’s ex-husband originally took out a mortgage loan, though ultimately quit-claimed his interest to his Plaintiff prior to their marriage. At some point after the two were married,the relationship soured and the Plaintiff obtained a protective order against her ex-husband. As part of the divorce, the Plaintiff obtained an order naming her as the property’s owner, though her ex-husband retained sole responsibility for the loan. Ross contacted Washington Mutual (the original servicer) about this arrangement and confirmed that she still received the mortgage statements and the 1098 tax deduction forms. WaMu mistakenly listed Ross’s name on the mortgage.  Eventually, the loan went into default and WaMu reported negative information to the credit reporting agencies on the mistaken belief that Ross was responsible for the loan. Ross contacted the reporting agencies and WaMu about the inaccurate reporting, but made the payments…Read More

Damages under the Fair Credit Reporting Act include economic damages as well as damages for humiliation and mental distress

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Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235 (4th Cir. 2009) Ms. Robinson had her identity stolen and the thief opened up fraudulent accounts in her name and under Ms. Robinson’s social security number.  Shortly after discovering that she had been a victim, Ms. Robinson filed a police report, called the Federal Trade Commission hotline and opened a case, and spent the next five months trying to correct the mistakes on her credit report. Equifax mistakenly placed Robinson’s address and social security number on three credit files established by the identify thief, each of which contained derogatory credit accounts. Consequently, Equifax sent various creditors requesting Ms. Robinson’s credit report her actual credit file along with one of the identity thief’s files. Because of these errors, Mrs. Robinson’s credit problems persisted and she had difficulties obtaining any type of credit for three years.  During this time period, each time Equifax…Read More