Consumer complaint received 2024-05-26
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Incorrect information on your report — Account information incorrect
Company: Bread Financial Holdings, Inc. (IL)

**Subject : Inaccurate Reporting of Charge-Off Account on My Credit Report** I am writing to formally file a complaint against Comenity Bank for furnishing inaccurate information to one or more consumer reporting agencies. The erroneous reporting of this Kay Jewelers account ( account number ending in XXXX ) as a charge-off has severely damaged my character, reputation, general mode of living, and ability to obtain credit for personal and housing purposes. This inaccurate reporting has also adversely affected my livelihood. 

On XX/XX/XXXX, I notified Comenity Bank about the inaccurate information they were reporting and requested that they cease and desist immediately and delete the Kay Jewelers account in question. However, they have willfully remained noncompliant with FCRA laws regarding the reporting of inaccurate information. 

**15 U.S. Code 1681s2 - Responsibilities of Furnishers of Information to Consumer Reporting Agencies** ( a ) Duty of Furnishers of Information to Provide Accurate Information Prohibition ( A ) Reporting Information with Actual Knowledge of Errors A person must not furnish any information about a consumer to a consumer reporting agency if they know or have reasonable cause to believe that the information is inaccurate. 

Comenity Bank is inaccurately reporting a {$680.00} balance on a charged-off Kay Jewelers account to XXXX or more of my consumer reports. This contradicts their internal accounting treatment of the debt as uncollectible. Since Comenity Bank has charged off this Kay Jewelers account ( ending in XXXX ) and considers the balance to be XXXX for accounting purposes, reporting a {$680.00} balance on my consumer report is fundamentally inaccurate. This account should be deleted immediately. When a lender charges off an account, they recognize the debt as uncollectible, and the balance is reduced to zero for accounting purposes.

According to the IRS, a charge-off is defined as gross or ordinary income. Income should not be reported on a consumer credit report, making Comenity Bank 's reporting of this account as a charge-off fundamentally inaccurate since this debt is now considered income as defined by the IRS. 

Furthermore, the IRS requires that a lender file Form 1099-C and send a copy to the borrower if the amount of debt canceled is {$600.00} or more and the lender is a financial institution. Despite not receiving a Form 1099-C from Comenity Bank , I have already filed this charge-off account on my XXXX tax return as income. Comenity Bank should not be reporting this charge off Kay jewelers account to consumer reporting agencies. I demand this account be deleted immediately! 

I will be reporting tax fraud against Comenity Bank by completing Form 3949-A for not complying with IRS regulations . The IRS mandates that financial institutions must issue a Form 1099-C to both the borrower and the IRS when they cancel a debt of {$600.00} or more.

I urge the CFPB to investigate this matter and take appropriate action against Comenity Bank for their harmful and inaccurate reporting practices.