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Getting inquires removed off a so-called business credit card pull.


SoFlo
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There is a credit repair company that is getting inquiries for "business" credit cards removed because it's not permissable purpose to pull personal credit for what the banks are touting as a business card. This is a legitimate credit repair company, and they claim anyone can do it. Their parent company that aquires business credit for businesses even offer a do it yourself guide if you hire them.

Is there any case law on this? Can you shed any light? It makes sense, but why haven't I heard of this before? A lawyer also told me he heard of it and it had promise.

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14 hours ago, SoFlo said:

There is a credit repair company that is getting inquiries for "business" credit cards removed because it's not permissable purpose to pull personal credit for what the banks are touting as a business card. This is a legitimate credit repair company, and they claim anyone can do it. Their parent company that aquires business credit for businesses even offer a do it yourself guide if you hire them.

Is there any case law on this? Can you shed any light? It makes sense, but why haven't I heard of this before? A lawyer also told me he heard of it and it had promise.

Credit repair companies claim a lot of things.

Your personal credit report most certainly can be pulled under certain circumstances for business credit cards.  If you are the business owner who is responsible for payment, your personal payment habits are relevant.  If you are merely an employee of a business and not responsible for payment, your personal credit report probably could not be accessed.

Here’s an example of permissible purpose:

John Smith opens a landscaping business.  He applies for an American Express business credit card in the name of that business.  He is the account holder who is responsible for paying the balance.  American Express has permissible purpose to access his personal credit report.

15 U.S. Code § 1681b(a)(3)(F)(i):

(F) otherwise has a legitimate business need for the information—

(i) in connection with a business transaction that is initiated by the consumer; or

(ii) to review an account to determine whether the consumercontinues to meet the terms of the account.

If John Smith is the person who applied for the card and is personally responsible for payment, how else can American Express determine if he qualifies for the account?  That is a “legitimate business need” by American Express.

Read the American Express Business Green Rewards Card Agreement.  It defines “you” as the Basic Cardmember.  “Basic Cardmember” is the person who applied for the account and who gets the billing statements.  In the section titled “Credit Reports”, it states that AmEx will obtain credit reports about “you”.

Here is a ruling from a Kentucky federal court regarding that issue.  It cites a 5th Circuit Court of Appeals ruling regarding “legitimate business need”.

Bowling v. Scott Lowery Law Office, PC (W.D. Kentucky, 2014) 

Here, as in Baker, Bowling obtained a revolving credit card account to pay business expenses and served as an obligor of the debt associated with the account. US Bank's extension of business credit to Bowling afforded it a legitimate need to learn about his creditworthiness.  See Estiverne v. Sak's Fifth Ave., 9 F.3d 1171, 1173 (5th Cir. 1993) ("[O]ne of the authorized purposes for disclosure of consumer information is a `legitimate business need for the information in connection with a business transaction involving the consumer.'").

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Thanks so much. For sure they have a legitimate business purpose. The angle they are using is that applicants are being made to think they are applying for a corporate card, as opposed to a business card. They are presenting screenshots of both cards being offered on the same page.

But of course if it got to court a judge would say "didn't you read that hundred page agreement?" But a jury might say, "they are intentionally blurring the difference between corporate and business credit. And if one person is on that jury who thought they had a corporate card and defaulted and it ruined their business AND their personal credit. Things might not go the bank's way next time.

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17 minutes ago, SoFlo said:

Thanks so much. For sure they have a legitimate business purpose. The angle they are using is that applicants are being made to think they are applying for a corporate card, as opposed to a business card. They are presenting screenshots of both cards being offered on the same page.

But of course if it got to court a judge would say "didn't you read that hundred page agreement?" But a jury might say, "they are intentionally blurring the difference between corporate and business credit. And if one person is on that jury who thought they had a corporate card and defaulted and it ruined their business AND their personal credit. Things might not go the bank's way next time.

Corporate credit cards are only available to corporations. If the applicant knows he is not a corporation, there is no deception.

I don’t understand what it has to do with permissible purpose.

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3 minutes ago, SoFlo said:

Don't get too hung up on permissable purpose. It's about deceptive marketing.

I focused on that issue because of your first post.  In that post, you specified “permissible purpose” for inquiries into personal credit for business credit cards.  You made no reference to corporate vs business credit cards nor to deceptive marketing.  

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