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Determined1

Experian Class Action re Advanta and CardWorks Servicing

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Hi,

 

In late 2010 I had a negative item appear on my credit reports from "Advanta Bank." Advanta Bank failed in 2009 and was shut down by the FDIC and State of Utah. They were heavily fined for deceptive and unfair business practices (ie. offering a 0% introductory interest rate and then rate jacking their customers to 38%). Advanta Bank ultimately declared bankruptcy. As far as I could determine, the FDIC was set up as a receiver for their deposits, and any debts owed were sold off to junk debt buyers. The former owners of Advanta have been individually sued for breach of fiduciary duty and other misconduct by the FDIC in relation to their ownership and management of Advanta.

 

I disputed in writing to the three credit bureaus, providing proof from the FDIC that Advanta Bank no longer existed and could not be the reporting entity. I also disputed what was reported, because it was purely false and erroneous information. Equifax and TransUnion immediately deleted the info. Experian refused to delete the information and has continued to refuse my written disputes for the past four years. I have been turned down for credit as a result.

 

I recently invoked arbitration over this and multiple other issues based upon the credit monitoring contract I have with Experian, which states clearly it covers FCRA disputes. I have yet to hear back on my arbitration demand, however, today I received in the mail a postcard advising me of the class action Michael Dreher v. Experian, specifically on this issue of Experian falsely reporting data from "Advanta Bank." The class action lawsuit properly states that the company known as "CardWorks Processing" is possibly the owner and reporting entity of past due debts emanating from the defunct Advanta Bank - but is reporting as "Advanta Bank" today and for the past four years as if they are the bank. Trying to resolve any reporting issue becomes a three ring circus and/or shell game between Experian, Advanta (which has no legal present address or contact) and CardWorks, making it impossible to correct incorrect negative information on Experian credit reports.

 

If Experian were truly conducting meaningful investigations when consumers dispute as required by the FCRA, they would learn "Advanta Bank" is not reporting anything since 2009 or 2010 at the latest.

 

Here's the class action lawsuit:  http://www.advanta-experian.com/

 

http://www.buccidix.com/blog/experian-must-disclose-company-reporting-credit-report-debt.cfm

 

http://www.cardworks.com/

 

When I eventually figured out the "Advanta Bank" address on my Experian report led to "Cardworks Processing" - I disputed in writing to "CardWorks Processing." I received a letter back with the name "Advanta Bank" rubber stamped at the top of the letter (not Advanta's original logo, but what appeared to be a rubber stamp pressed on an ink pad created for this purpose).

 

What is interesting to me is Experian will do everything possible to avoid a class action, and uses arbitration clauses in their credit monitoring contracts to do just that. Now that a class action has made it to the trial stage, they are trying to lump me in with the class - to avoid the cost and expense of arbitration. My instincts tell me to opt out of the class action (which is a clearly spelled out option) and pursue my own individual case through arbitration or litigation if necessary, especially since my dispute has elements other than the Advanta issue. Any feedback on this issue is appreciated here.

 

Please note I'm also posting this info for anyone else who has had a similar experience with Experian / Advanta. I think CardWorks Processing is committing fraud, violating the FCRA by knowingly reporting inaccurate information, and violating the FDCPA by misrepresenting the status of an alleged debt. I want to take legal action against them. If you agree, please feel free to post comments here or contact me via PM. Thank you.

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@Determined1

 

For CardWorks Processing to be held liable for an FDCPA violation, it would have to be considered a collection agency.  I think that CardWorks Servicing might be a collection agency, but I don't know about CardWorks Processing.

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Hi @BV80!

 

CardWorks is definitely a collection agency (and likely a debt buyer) in this instance. They are not acting as an outsourced credit card servicing company here, since the bank in questions has not existed for 4 years. The problem they created is they sent me (and I assume many others) collection notices for Advanta accounts, using falsely created Advanta letterhead. I think it's an FDCPA violation, but I believe the strongest claims would be violation of the FCRA and fraud.

 

For me, the question regarding Experian is whether to opt-out of the class action and pursue an individually litigated claim (or arbitration). I think opting out is the best bet. Any thoughts?

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@Determined1

 

If you have valid, proveable claims, you'd, of course, be more likely to get a larger award from your own action vs. a class action.

 

Just note that to win statutory damages under the FCRA, you not only have to prove violations, but you have to prove that Experian and/or the furnisher willfully failed to comply with the Act.   1681n

 

If you can't prove willfulness (only negligence), then you have to show actual damages. 1681o

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What constitutes willfulness vs negligence?  15 USC 1692 has been around a long time and it would seem willful to repeatedly leave out (a) (3), (4), and (5) from section 809 of 15 USC 1692?  3 documented instances specifically. But when it's done repeatedly can they really claim negligence?

 

Thank you.

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@OSIT

 

15 U.S.C. 1692 and 15 U.S.C. 1681 are 2 different statutes.   My post was in reference to 1681 (Fair Credit Reporting Act).   That statute provides that statutory damages can only be awarded in the instance of willful behavior.

 

1692 is the Fair Debt Collection Practices Act.   In reference to (3), (4), and (5) from Section 809 (1692g), those subsections only have to be included with the first debt collection letter for a particular debt.  However, each subsequent collection letter for that same debt must include a notice that the letter is an attempt to collect a debt.

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