Consumer complaint received 2024-05-19
Product: Vehicle loan or lease — Loan
Issue: Getting a loan or lease — Credit denial
Company: Tesla, Inc. (CA)

Dear Consumer Financial Protection Bureau ( CFPB ), I am writing to formally file a complaint against Tesla Finance for a violation of my consumer rights under the Fair Credit Reporting Act ( FCRA ). Based on recent communications with XXXX XXXX from Tesla Finance, it has come to my attention that Tesla Finance accessed my credit report without a permissible purpose as stipulated by the FCRA. 

Incident Summary : Date of Credit Inquiry : XX/XX/2024 Purpose of Application : Loan extension Tesla Finance 's Initial Stated Reason : Denied due to a lack of a FICO AUTO score Tesla Finance 's Later Stated Reason : Credit report was pulled to ensure nothing was missing for other lenders Evidence : Initial Email from Tesla Finance Representative ( XX/XX/2024 ) : Hi ( XXXX ), Thank you for applying with Tesla finance. Unfortunately, at this time your application was not approved due to a lack of a FICO AUTO score. 

Feel free to explore third party options like your bank. Here is an example of a third party lender that customers have used to finance their Tesla. 

Best wishes, [ Tesla Finance Representative ] Regional Financial Analyst [ redacted XXXXXXXX Subsequent Email from Tesla Finance Representative ( XX/XX/2024 ) : Hi ( XXXX  ) All lenders that review your credit application are required by law to send adverse action letters. Therefore, you will receive a letter from each of the lenders mentioned. Tesla finance would not be sending one since the credit report was pulled to check if there was anything the lenders are missing and was not pulled to extend a loan. In this case, no credit was available. 

Best wishes, [ Tesla Finance Representative XXXX XXXX XXXX XXXX XXXX Credit Team Legal Framework and Rights : Fair Credit Reporting Act ( FCRA ) : The FCRA ( 15 U.S.C. 1681 et seq. ) stipulates that any entity pulling a consumer 's credit report must have a permissible purpose. One such permissible purpose is in connection with a credit transaction involving the consumer. Given that my sole purpose in filling out the application was to apply for a loan extension, the inquiry by Tesla Finance should be considered as part of a credit transaction. 

Truth in Lending Act ( TILA ) : TILA requires financial institutions to provide complete, accurate, and transparent disclosure of all terms and costs related to credit transactions. This includes the proper use of credit reports in evaluating credit applications. 
Equal Credit Opportunity Act ( ECOA ) : According to ECOA, it is unlawful to discriminate against any credit applicant based on race, color, religion, national origin, sex, marital status, age, or source of income. The denial must be based on verified and accurate information. 
Due Process and Constitutional Rights : Denying credit without due process of law is a violation of constitutional rights protected under the Fourth and Fifth Amendments. Using hearsay information to deny credit infringes upon these rights and can be construed as fraud and misrepresentation. 

Claim for Violation : Per Tesla Finance 's initial admission that my credit report was pulled and the application denied due to a lack of a FICO AUTO score, it was clear the credit report was accessed as part of the credit transaction process. However, their later statement that the credit report was not pulled to extend a loan, but to ensure nothing was missing for other lenders, contradicts the initial admission and constitutes a violation of the FCRA. Accessing my credit report without a permissible purpose is a misuse of my personal information and a breach and violation of my consumer rights to privacy. 

In Conclusion : I urge the CFPB to investigate these unethical practices that provide Tesla Finance with an unfair advantage against consumers with less-than-perfect credit scores. Tesla Finance 's ability to access credit applications, which hold real-world value on secondary markets identified by application numbers and found on the bloomberg terminal providing a CUSIP after 30-90 days, renders a value for the account in question. This gives accessible value to Tesla Finance and its investors while offering none to unsuspecting customers who may indeed have a beneficial interest ownership in such negotiable instruments according to the Uniform Commercial Code ( UCC ). Specifically, UCC 3-305 and UCC 9-404 address the validity of negotiable instruments and the rights of holders in due course, respectively. 

I look forward to your prompt attention to this matter and a fair resolution within the stipulated timeframe. 

Thank you for your assistance. 

Best regards,