FACTA Question?

[legend]

I pasted this from another site and was wondering if I am reading it right?

6. Notice of Negative Information

FACTA now requires creditors to give you what might be called an “early warning” notice.

Starting in December 2004 a financial institution that extends credit must send you a notice before or no later than 30 days after negative information is furnished to a credit bureau. Negative information includes late payments, missed payments, partial payments, or any other form of default on the account.

Does this apply only to my accounts with a bank?

No. A “financial institution” has the same meaning as under the Gramm-Leach-Bliley Act. In addition to a bank, this can mean a merchant that extends credit to you or a collection agency that routinely reports information to a credit bureau. For more on non-bank entities that are considered “financial institutions,” see the FTC publication, How To Comply with the Privacy of Consumer Financial Information Rule of the Gramm-Leach-Bliley Act, www.ftc.gov/bcp/conline/pubs/buspubs/glblong.htm

Is Asset Acceptance or NCO etc supposed to notify me 30 days prior to when they are going to add derogs to my credit? This seems to be what ALL of my collections are doing is adding them to my CR and I have NO clue untill I pull a report and find them. Then when I send a DV they tell me my 30 days were up long ago?!

[sand]

Good question. I hope someone may know and answer you soon. This is something that would be helpful to me as well.

[gorillacredit]

I was under the impression that the courts held that all a collection agency had to do was show they had a system in place to send the dunning letters and it was assumed that you got them.

It doesn't matter if they even sent them at all. that is why they never send them. The courts have basically said they don't have to as long as they have a reasonable system in place to base an assumption on.

So I posed the question that if you were to state in your letter that you did not receive any communication from them if they could still hide behind that BS or if it restarted the clock.

I think that, since their defense is the belief that their system must have sent you a letter and therefore you got it, that informing them otherwise would certainly destroy that defense in court.

It seem to me that from the moment they get your letter informing them of the failure of their contact attempt that they would no longer be able to argue that they sent it and assume that you received it.

The FDCPA just says within five days of the initial contact, it does not mention who must establish that contatct.

So far I have received no useful replies from those who I felt would have an opinion. Maybe you will have better luck in this one. Could just be that nobody really knows.

I read that same website you cut from and was wondering what section of the law said that becaus eI couldn't find it.

[nativechild48]

CA are covered under this and cannot share info if you opt out. (IMHO)

[legend]

I was under the impression that the courts held that all a collection agency had to do was show they had a system in place to send the dunning letters and it was assumed that you got them.

It doesn't matter if they even sent them at all. that is why they never send them. The courts have basically said they don't have to as long as they have a reasonable system in place to base an assumption on.

So I posed the question that if you were to state in your letter that you did not receive any communication from them if they could still hide behind that BS or if it restarted the clock.

I think that, since their defense is the belief that their system must have sent you a letter and therefore you got it, that informing them otherwise would certainly destroy that defense in court.

It seem to me that from the moment they get your letter informing them of the failure of their contact attempt that they would no longer be able to argue that they sent it and assume that you received it.

The FDCPA just says within five days of the initial contact, it does not mention who must establish that contatct.

So far I have received no useful replies from those who I felt would have an opinion. Maybe you will have better luck in this one. Could just be that nobody really knows.

I read that same website you cut from and was wondering what section of the law said that becaus eI couldn't find it.

It would actually appear after reading it here --->>>http://financialservices.house.gov/media/pdf/108hr2622ai.pdf that the original website I cut the original post from is way off on their understanding and the way they are presentint it all. Here is the section of the FACTA though I hope this helps

U.S.C. 1681c) is amended by inserting after subsection

(i) (as added by section 202 of this title) the following 7

new subsection: 8

‘‘(j) BLOCK OF INFORMATION RESULTING FROM 9

IDENTITY THEFT.— 10

It is under EXCEPTIONS: this is referring to BLOCKS do to possible identity theft. It now appears to me that my original post is totaly bogus

[Methuss]

No Legend, you are correct about that part of FACTA. Anyone who furnishes derrogatory information to your credit file is required to provide you notice no later than 30 days after they have done so.

It still hasn't completely shaken out in court yet, but I've seen some companies try to evade the "spirit" of the law by doing crafty things like putting "we may report derrogatory payment history to credit bureaus" on the bottom of a bill or on a credit application.

It was Congress' intent that anyone who has something bad put in their file get a clear notice that it has happened. Most companies, especially credit card companies, have twisted that intent into shady little notices on statements they send thinking that it will be sufficient under the letetr of the law. We'll see as more and more of those kinds of things end up in court.

[KentWA]

Methuss, yeah I am blind. Where do you find the requirement for Data Furnishers to notify consumers when inserting derrogatory info? I was looking for it yesterday and could not find it.

[classicguy]

This is ACA's opinion on this matter:

http://www.acainternational.org/?cid=5909

January's Top Compliance Question: Providing Notice When Furnishing Negative Information

Published: Thursday, February 17, 2005

The top compliance question received by ACA’s Compliance Department for January was: Must an agency provide a notice to a consumer upon furnishing negative information about the consumer to a consumer reporting agency?

Much of this confusion stems from a recent amendment to the Fair Credit Reporting Act (FCRA) that requires certain data furnishers to provide a written notice to a consumer prior to or within 30 days of furnishing negative information about a consumer to a consumer reporting agency. Newly enacted FCRA Section 623(a)(7)(A)(i) states:

“If any financial institution that extends credit and regularly and in the ordinary course of business furnishes information to a consumer reporting agency… furnishes negative information to such an agency regarding credit extended to a customer, the financial institution shall provide a notice of such furnishing of negative information, in writing, to the consumer.”

Because traditional third–party debt collectors do not extend credit, they are not subject to these notice requirements. Debt purchasers, however, are subject to the notice provisions if they purchase a debt, locate the consumer and attempt to collect the debt.

Although third–party debt collectors may not be required to provide notice under the federal FCRA, some states (such as California and Utah) have enacted similar regulations that require a data furnisher who furnishes negative information regarding a consumer to a consumer reporting agency provide notice of such action to the consumer. This notice must be provided to the consumer prior to or within 30 days of furnishing negative information regarding the consumer to a consumer reporting agency. Unlike the new federal notice requirements, the state requirements apply to third–party debt collectors.

ACA members logged in to ACA Online may access the state specific requirements by searching for the E–Compliance document "Special State Text Requirements for Collection Notices" (E–Compliance document #59) from the E–Compliance page. For more information on the notice requirement under the amended FCRA, ACA members logged in to ACA Online may search for “Financial Institutions’ Duty under the FCRA to Provide Consumers with a Notice of Furnishing Negative Information” (E–Compliance document #317) from the E–Compliance page.

[gorillacredit]

This is ACA's opinion on this matter:

http://www.acainternational.org/?cid=5909

January's Top Compliance Question: Providing Notice When Furnishing Negative Information

Published: Thursday, February 17, 2005

The top compliance question received by ACA’s Compliance Department for January was: Must an agency provide a notice to a consumer upon furnishing negative information about the consumer to a consumer reporting agency?

Much of this confusion stems from a recent amendment to the Fair Credit Reporting Act (FCRA) that requires certain data furnishers to provide a written notice to a consumer prior to or within 30 days of furnishing negative information about a consumer to a consumer reporting agency. Newly enacted FCRA Section 623(a)(7)(A)(i) states:

“If any financial institution that extends credit and regularly and in the ordinary course of business furnishes information to a consumer reporting agency… furnishes negative information to such an agency regarding credit extended to a customer, the financial institution shall provide a notice of such furnishing of negative information, in writing, to the consumer.”

Because traditional third–party debt collectors do not extend credit, they are not subject to these notice requirements. Debt purchasers, however, are subject to the notice provisions if they purchase a debt, locate the consumer and attempt to collect the debt.

Although third–party debt collectors may not be required to provide notice under the federal FCRA, some states (such as California and Utah) have enacted similar regulations that require a data furnisher who furnishes negative information regarding a consumer to a consumer reporting agency provide notice of such action to the consumer. This notice must be provided to the consumer prior to or within 30 days of furnishing negative information regarding the consumer to a consumer reporting agency. Unlike the new federal notice requirements, the state requirements apply to third–party debt collectors.

ACA members logged in to ACA Online may access the state specific requirements by searching for the E–Compliance document "Special State Text Requirements for Collection Notices" (E–Compliance document #59) from the E–Compliance page. For more information on the notice requirement under the amended FCRA, ACA members logged in to ACA Online may search for “Financial Institutions’ Duty under the FCRA to Provide Consumers with a Notice of Furnishing Negative Information” (E–Compliance document #317) from the E–Compliance page.

On the other hand, since a collection agency is working for (like a contracted employee) the OC and the OC does have to comply, I contend that the collection agency DOES have to comply on behalf of the OC, or failing to do so would result in liability for the original creditor since they know full well the CA will report it on the file.

I bet a few lawsuits against the OCs would for compliance from the CA scum.

Any thoughts?

[KentWA]

BUt this is 623(a), you are going to have to get an AG to sue them since there is no private right of action under 623(a).

[gorillacredit]

Definition or financial institution in FACTA

t) FINANCIAL INSTITUTION.—The term ‘financial institution’

means a State or National bank, a State or Federal savings and

loan association, a mutual savings bank, a State or Federal credit

union, or any other person that, directly or indirectly, holds a

transaction account (as defined in section 19( of the Federal

Reserve Act) belonging to a consumer.

Transaction account defined from 19(

© The term “transaction account” means a deposit or account on which the depositor or account holder is permitted to make withdrawals by negotiable or transferable instrument, payment orders of withdrawal, telephone transfers, or other similar items for the purpose of making payments or transfers to third persons or others. Such term includes demand deposits, negotiable order of withdrawal accounts, savings deposits subject to automatic transfers, and share draft accounts.

What ever happened to plain English? It was once said that this country is one of poorly written laws that are randomly enforced. How true.

But I still say that anyone acting on behalf of someone who must comply, must comply. Methuss said it is shaking out in the courts so I guess we will see. As for me, if they don't notify they have violated.

Since that will rarely be the only wiolation, it sure wouldn't hurt to throw it in at every opportunity.

[Fed_Up!]

Does this also apply to student loans and the collection agencies that are collecting for them?