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humdinger

Is an OC reporting your IIB as charged off or in collection?

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Thanks to crofts link to "findlaw" I stumbled across an opinion letter from the FTC concerning this practice.

http://library.lp.findlaw.com/articles/file/00002/002612/title/Subject/topic/Administrative%20Law_Federal%20Agencies/filename/administrativelaw_2_12

FTC Staff Opinion Letter: Fair Credit Reporting Act Section 607(B)

Federal Trade Commission

UNITED STATES OF AMERICA

FEDERAL TRADE COMMISSION

WASHINGTON, D.C. 20580

Division of Credit Practices

Bureau of Consumer Protection

~

Clarke W. Brinckerhoff

Attorney

~

(202) 326-3224

April 24, 1998

Mr. Michael Lovern, Sr.

President

TRIAL MANAGEMENT ASSOCIATES, INC.

8972 Quioccasin Road - Suite 172

Richmond, Virginia 23229

Dear Mr. Lovern:

David Medine asked me to respond to your Fax transmission of December 26, 1997, requesting our views concerning the legality under the Fair Credit Reporting Act (FCRA) of a credit bureau report of an account that has been discharged in bankruptcy as "charged off as bad debt." We acknowledge receipt of your request, pursuant to the Commission procedure set forth in 16 C.F.R. '2.2(a), for an investigation of the credit bureau.

Section 607(B) of the FCRA requires credit bureaus "to follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." In our view, it is not a reasonable procedure to label an account that has been discharged in bankruptcy as "charged off as bad debt" if the account was open and not charged off when the consumer filed bankruptcy. Such a designation would be inaccurate or misleading, because it would indicate that the creditor had written off the account at the time of bankruptcy when it had not in fact done so.

Thank you for the information and documentation you submitted to us in connection with your request that we investigate this credit bureau''s practices. As you may know, it is Commission policy not to comment on the status or existence of any nonpublic investigation.

The opinions set forth in this informal staff letter are not binding on the Commission.

Sincerely yours,

Clarke W. Brinckerhoff

cc:

David Medine Jay Shaffer

© 1999 Federal Trade Commission

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Good catch, we need to get an FTC Opinion Letter section, we can comment on the opinions and decipher which one will help in which circumstance.

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Thanks for the link! I was wondering about this as well. I have accounts listed as 'included in BK/charged off. I knew that they shouldn't be reported that way.

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Thru MyFico I see that Experian reports all my IIB accts as:

CHARGEOFF/COLLECTION/BANKRUPTCY

This isn't a multiple choice game here, it is still misleading. So is Sold to another lender.

Today I am in the process of sending them the opinion letter. And because Experian has done this with every IIB acct and TU and EQ do not, I believe this is deliberate on the part of Experian.

Another thing I saw with MyFico, Experian has noted everyone of these accounts as 90 days late when in fact none had ever been late.

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