FCRA claims most often occur when a consumer alleges that a Credit Reporting Agency has:
- Failed to follow reasonable procedures for ensuring the accuracy of the consumer information;
- Failed to properly investigate or reinvestigate the dispute; and/or
- Issued a consumer report for an improper or impermissible purpose.
Under 15 U.S. Code Section 1681, a consumer making a “failure to follow reasonable procedures claim” has to show that:
- The consumer report contained inaccurate information,
- The CRA provided the report to a third party,
- The inaccuracy was due to unreasonable procedures,
- There is evidence of injury,
- That the injury was caused by the inaccurate entry.
Under the FCRA, CRAs are required to use reasonable procedures to ensure the maximum possible accuracy of the information reported (1681 E(b)).
Sometimes, plaintiffs will try to drive the case into a willful violation, establishing a class-action case by pointing to the CRA not ensuring the maximum possible accuracy because of an incorrect report. However, these consumers are usually unable to prove that these inaccuracies caused any injury.
What Credit Reporting Agencies Need To Prove Their Case?
Once a claim has been filed, we provide our clients with the credit reports that contain the alleged inaccuracy. We also like to get any internal documentation that helps us to establish an agency’s procedures. This documentation can be in the form of a manual, a guideline, or a statement of policies and procedures.
This internal documentation is used to show that the CRA makes an effort to be error-free and can prove that its records are accurate, reasonable, and in line with consumer expectations.
The better the internal procedures, the better the checks and balances, and the easier it is to defend against claims that assert the facts to be otherwise.
If we cannot fight the accuracy and reasonableness battles, then we will work to form a defense through causation. Via this strategy, we will look to establish that the plaintiff’s claims of injury are not causally related to any injury associated with false reporting or inaccurate reporting.
For instance, consider that a consumer loses out on a mortgage because an inaccurate bankruptcy showed up in the credit report. If the CRA can correct that immediately and return the corrected report to the consumer, that consumer would then have the ability to get the mortgage. Thus, there would be no reasonable claim for injury.
For more information on Claims Brought Under the FCRA in California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (310) 450-6695 today.