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Duty of CA's to Validate?


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I've read many times on here that if you DV a CA they are not actually required to validate to you but they must not continue to collect if they have not validated to you (timely dispute).

Well, I was reading the new FCRA 623(a)8(E) and it states:

(E) DUTY OF PERSON AFTER RECEIVING NOTICE OF DISPUTE- After receiving a notice of dispute from a consumer pursuant to subparagraph (D), the person that provided the information in dispute to a consumer reporting agency shall--

(i) conduct an investigation with respect to the disputed information;

(ii) review all relevant information provided by the consumer with the notice;

(iii) complete such person's investigation of the dispute and report the results of the investigation to the consumer before the expiration of the period under section 611(a)(1) within which a consumer reporting agency would be required to complete its action if the consumer had elected to dispute the information under that section; and

(iv) if the investigation finds that the information reported was inaccurate, promptly notify each consumer reporting agency to which the person furnished the inaccurate information of that determination and provide to the agency any correction to that information that is necessary to make the information provided by the person accurate.

So it would appear to me that if they have reported to the CRA's, as a "furnisher" of information, they are required to conduct an investigation if you contact them directly and they must complete it within 30 days just as if you had disputed with the CRA's and provide you with the results of that investigation.

So it would appear to me that if a CA does not validate, but does verify, they would be in violation of both the FDCPA 15 USC 1692g(B) (for continued collection activity) and FCRA 15 U.S.C. § 1681(a)8(E) (for not conducting an investigation and reporting the results back to you).

So it seems that the DO have to "validate" within 30 days, right?

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Actually, the OP is right. That is why we talk about the 1-2 punch. Remember that this only works if the DV is timely.

You have your numbers confused. The section that makes this possible is 1681s-2(B). You will see this called an s-2(B) or s2b violation.

Hey Dive, glad you jumped in on this. Actually, you're right with respect to the dispute with the CRA. HOWEVER, under the FCRA, there is a new section s2(a)8(E) that deals with the consumers ability to dispute innacurrate information directly with the data furnisher. It reads exactly as I posted above and details the data furnisher responsibility to the consumer.

It clearly states that they MUST conduct an investigation and report the results of that investigation to you just as if you had disputed with the CRA. So they are in violation for s2B as well as s2(a)8(E) as well. (continued collection activity AND not responding to your dispute with them. That's the point I was making.

Everyone was saying that just "not responding" was not a violation. But is it according to 1681s2(a)8(E) of the most recent FCRA.

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true, but you are forgetting that there is no right to private action under s-2(a):

1681s-2

© Limitation on liability. Except as provided in section 621©(1)(B), sections 616 and 617 do not apply to any violation of--

(1) subsection (a) of this section, including any regulations issued thereunder;

(2) subsection (e) of this section, except that nothing in this paragraph shall limit, expand, or otherwise affect liability under section 616 or 617, as applicable, for violations of subsection (B) of this section; or

(3) subsection (e) of section 615.

(d) Limitation on enforcement. The provisions of law described in paragraphs (1) through

(3) of subsection © (other than with respect to the exception described in paragraph

(2) of subsection ©) shall be enforced exclusively as provided under section 621 by

the Federal agencies and officials and the State officials identified in section 621.

Therefore, they are free to violate this section and there is nothing you, as a private citizen, can do about it.

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Verifying the accuracy of reporting under FACTA is quite different than requesting validication under the FDCPA.

You must provide the specifics of what you dispute that they are reporting. And they are only required to investigate those specifics then tell you yeah they're right, or no they're not right and we will correct them on your credit report.

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true, but you are forgetting that there is no right to private action under s-2(a):

1681s-2

Therefore, they are free to violate this section and there is nothing you, as a private citizen, can do about it.

True, but could a person use evidence of such violation(s) in support of a claim for "willful" or "negligent" behavior on behalf of the CA even if damages aren't specifically recoverable under the statute?

Basically, saying "It's not just these 10 violations I have them on, they actually committed 14 but as a consumer, I'm barred from action on these other violations." Clearly, a person couldn't file claim on these violations, but can they be used as evidence rebutting a bona-fide error defense on FDCPA violations?

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Verifying the accuracy of reporting under FACTA is quite different than requesting validication under the FDCPA.

You must provide the specifics of what you dispute that they are reporting. And they are only required to investigate those specifics then tell you yeah they're right, or no they're not right and we will correct them on your credit report.

True, but if you're sure they can't prove a thing (which is more often than you think) you can take them to court for reporting inaccurately.

Most OC's are not even bothering to send you a letter saying you can investigate, and you CAN sue them under private action if you've disputed with the bureaus FIRST. (Me and dive have gone round on this one with differing views on rights to private action, but case law will also back this up.)

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Verifying the accuracy of reporting under FACTA is quite different than requesting validication under the FDCPA.

You must provide the specifics of what you dispute that they are reporting. And they are only required to investigate those specifics then tell you yeah they're right, or no they're not right and we will correct them on your credit report.

I agree. However, in my case. I did not owe the debt and I sent them information as to how they could verify that I did not owe the debt. They ignored me for 3 months and 3 disputes until I sent them an ITS, then they just sent me the last statement from the OC. No investigation into my actual dispute.

I did not just send them a standard DV letter saying "please validate". I actually told them exactly why I did not owe the debt and how the OC's records were in error.

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True, but if you're sure they can't prove a thing (which is more often than you think) you can take them to court for reporting inaccurately.

Most OC's are not even bothering to send you a letter saying you can investigate, and you CAN sue them under private action if you've disputed with the bureaus FIRST. (Me and dive have gone round on this one with differing views on rights to private action, but case law will also back this up.)

Exactly, I'm preparing a complaint in Federal Court for inaccurrate reporting. (Basically, did the 1-2 punch 3 times on them and they did the standard ignore me but report to all 3 bureaus AND not marking it disputed until the last round). With my FCRA violations (innaccurrate reporting) and FDCPA violations (not marking disputed, continueing to collect without validating and using the name "credit bureau" in their name), I have about 15 violations. I know that they'll say "bonafide error" for all of them (although I know that is not a defense for FCRA violations). I want to say that it's not even a defense for the FDCPA violations because they are so willful at violating both acts.

This would be one more thing I could use as evidence (not a claim) against them. I was wondering what you guys thought. Would it ever get in?

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While it is true that Admin and I have differing opinions on this question, let me phrase it this way:

When you get questions of law like this, it usually means that court decisions can be found that favor both sides. The question then is settled by the judge, usually on the basis of the pary who makes the better case. There are many factors that go into such a decision, and in reality both theories can be right, and both wrong. Depends on the specifics of your case, including the judge, the judge's mood, the quality of the legal arguments, and whether or not the attorneys have taken the judge out on the golf course lately.

Understanding both sides of the legal argument will assist you in improving your case.

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True, but if you're sure they can't prove a thing (which is more often than you think) you can take them to court for reporting inaccurately.

Most OC's are not even bothering to send you a letter saying you can investigate, and you CAN sue them under private action if you've disputed with the bureaus FIRST. (Me and dive have gone round on this one with differing views on rights to private action, but case law will also back this up.)

Can you site any cases that might help me?

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Not sure what the difference of opinion is regarding FCRA and private rights of action...

At any rate, the standard for conducting an investigation under the FCRA (FACTA dispute as quoted by OP) is different than verification under the FDCPA.

Unless you live in the 9th circuit, there is no obligation to obtain verification upon written notice of dispute. They have to cease collections, but otherwise could sit on it indefinitely without doing a thing (although that may not be responsible from a business perspective.)

Per FCRA caselaw, an investigation into a dispute via the CRA must be more t than verifying information on computer screens. If you dispute the balance, the CA would not be conducting a reasonable investigation by merely looking at their records and saying "yeah that's what we said the balance was".

They would have to investigate, and without the aid of the OC, it would be difficult to prove they conducted a reasonable investigation.

So a CRA dispute is, in a way, like a FDCPA dispute with a 30 day time limit to complete it.

The rewards are better for FCRA suits, but the standards are higher also.

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The disagreement (IIRC) centers around whether or not a private cause of action accrues under 1681s-2(a) if a dispute is first made persuant to 1681s-2(B) on a tradeline.

It is my opinion, taking the plain meaning of the statute, that the only cause of action that accrues is the one for the failed investigation persuant to 1681s-2(B).

Admin feels that once the investigation persuant to 1681s-2(B) is initiated, a private cause of action accrues for a failed investigation persuant to 1681s-2(a). She states that there is caselaw to support this position.

Other than that, I reemember few specifics of the discussion. Kristy- does that about sum it up, or did I leave something out?

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The disagreement (IIRC) centers around whether or not a private cause of action accrues under 1681s-2(a) if a dispute is first made persuant to 1681s-2(B) on a tradeline.

It is my opinion, taking the plain meaning of the statute, that the only cause of action that accrues is the one for the failed investigation persuant to 1681s-2(B).

Admin feels that once the investigation persuant to 1681s-2(B) is initiated, a private cause of action accrues for a failed investigation persuant to 1681s-2(a). She states that there is caselaw to support this position.

Other than that, I reemember few specifics of the discussion. Kristy- does that about sum it up, or did I leave something out?

Yeah, I read it like you do. However, I'd LOVE to see some case law that supports her position. It would be great. But I've been reading every FCRA case I can get my hands on (starting with all the appellate cases).

Admin... please?

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