Consumer complaint received 2024-04-19
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Incorrect information on your report — Account information incorrect
Company: EQUIFAX, INC. (CA)

In response to XXXX CFPB COMPLAINT ID XXXX. This a XXXX XXXX XXXX XXXX XXXX XXXX is willfully or negligently violating 15 U.S.C. 1681s-2 ( b ) of the Fair Credit Reporting Act ( " FCRA '' ). XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX continued reporting outstanding debt to the CRAs is inaccurate. XXXX XXXX XXXX XXXX further alleges that XXXX XXXX XXXX XXXX failed to investigate. 
dispute in failing to review underlying account information. XXXX XXXX continue and erroneous reporting of an outstanding balance on XXXX XXXX XXXX XXXX account harming XXXX XXXX XXXX XXXX credit history and creditworthiness. 

XXXX XXXX XXXX XXXX asserts several facts to support that the debt was in fact canceled. The 1099-C form XXXX XXXX XXXX XXXX XXXX Secured Party Creditor issued to XXXX XXXX XXXX XXXX XXXX XXXX Cancellation of Debt. '' The identifiable event and TRUSTEE of XXXX XXXX XXXX XXXX selected indicated it was the decision or policy of the creditor to discontinue and cancel the debt. After issuing the 1099-C, to XXXX XXXX XXXX XXXX subsequently discontinued efforts to collect the debt and stopped sending periodic account notices, because XXXX XXXX XXXX XXXX claims the furnished information was accurate, thus precluding a violation under 15 U.S.C. 1681s-2 ( b ). ( Doc. 13, p. 7. ) Factual content that allows XXXX XXXX XXXX XXXX to draw the reasonable inference that XXXX XXXX XXXX XXXX is liable for the misconduct alleged. '' XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ) ). accept as true all well-pled factual allegations in this complaint and all reasonable inferences that can be drawn from them. ' '' XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX The facts alleged must be " construed in the light most favorable to XXXX XXXX XXXX XXXX Secured Party Creditor. '' In re XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  internal quotations, brackets, and ellipses omitted ). But " [ t ] he court is not required to draw unreasonable inferences '' from the facts. XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ). First, the court outlines the elements a plaintiff must plead to state a claim for relief. XXXX XXXX XXXX. Second, the court must " peel away those allegations that are no more than conclusions and thus not entitled to the assumption of truth. '' Id. Third, the court " look [ s ] for well-pled factual allegations, assume [ s ] their veracity, and then 'determine [ s ] whether they plausibly give rise to an entitlement to relief. ' '' Id. ( quoting Iqbal, 556 U.S. at 679 ). The last step is " a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. '' Id.Congress enacted the FCRA in 1970 to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy. In doing so, Congress sought to preserve the consumer 's privacy in the information maintained by consumer reporting agencies. 'XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ( internal quotation marks omitted ). Once notified of a dispute, a furnisher of credit information has statutory duties, inter alia, to investigate the disputed information and to correct information found to be inaccurate. 15 U.S.C. 1681s-2 ( b ) ( 1 ). To establish a violation [ u ] nder the statutory framework and clear language of the statute, therefore, a consumer must first alert the credit reporting agency that reported the allegedly erroneous information of a dispute. It is then up to the reporting agency to inform the furnisher of information that there has been a dispute, thereby triggering the furnisher 's duty to investigate. It is only when the furnisher fails to undertake a reasonable investigation following such notice that it may become liable to a private litigant under 1681s-2 ( b ) XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX. 

Reasonableness of the investigation is determined based on a balancing of " the potential harm from inaccuracy against the burden of safeguarding against such inaccuracy. XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX internal citation omitted ). Regarding the requirement of " accurate '' information, " even if the information is technically correct, it may nonetheless be inaccurate if, through omission, it creates a materially misleading impression. '' Id. ( internal quotation marks and brackets omitted ). XXXX XXXX XXXX XXXX Secured Party Credit plausibly allege " ( XXXX ) that he notified a credit reporting agency of the dispute under 1681i, ( 2 ) that the credit reporting agency notified the party who furnished the information under 1681i ( a ) ( 2 ), and ( 3 ) that the party who furnished the information failed to investigate or rectify the disputed charge .... XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ( internal citation and brackets omitted ). 

XXXX XXXX XXXX XXXX replied that XXXX XXXX XXXX XXXX failed to plead any of the required elements in dispute filed XX/XX/XXXX CFPB COMPLAINT ID XXXX. Rather, XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX can not succeed unless the information was in fact inaccurate or materially misleading. See XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ( holding that a plaintiff must show " actual inaccuracy '' to establish a claim against a furnisher of credit information under XXXX5 U.S.C. 1681s-2 ( b ) ). XXXX XXXX XXXX XXXX claims its report was accurate and that it did not receive 1099'cancel of debt and Discharge from XXXX XXXX XXXX XXXX Secured Party Credit. XXXX XXXX XXXX XXXX cancel debt by issuing the 1099-C to XXXX XXXX XXXX XXXX XXXX XXXX issuance of the 1099-C does not, as a matter of law, discharge the underlying debt. ( Doc. 13, p. 4. ) IRS regulation states that a creditor may be obligated to file a 1099-C even if the creditor did not in fact discharge the debt. On the form, the creditor must select an " identifiable event, '' the date of which becomes the effective date for the discharge of indebtedness for purposes of the informational report. 26 C.F.R. 1.6050P-1 ( b ). The IRS issued guidance to clarify that the IRS " does not view the 1099-C as an admission by the creditor that it has discharged the debt and can no longer pursue collection. 'XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX .The Internal Revenue Service ( IRS ) requires XXXX any applicable entity... that discharges an indebtedness of any person... must file an information return on Form 1099-C with the Internal Revenue Service XXXX Solely for purposes of the reporting requirements of [ this section ], a discharge of indebtedness is deemed to have occurred... if and only if there has occurred an identifiable event described in paragraph ( b ) ( 2 ) of this section, whether or not an actual discharge of indebtedness has occurred on or before the date on which the identifiable event has occurred.26 C.F.R. 1.6050P-1 ( a ) ( emphasis added ). 

XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX arrived at a similar conclusion in denying a motion to dismiss raised by creditor bank where plaintiff consumers brought a 1681s-2 ( b ) claim. XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX parties argued whether the 1099-C canceled the debt, but the court found it unnecessary to adopt either opposing view of the form 's effect, since at the motion to dismiss stage, the court analyzes the plausibility of the pleadings rather than the weight of the evidence. Id. at *2-3. Even though the issuance of the 1099-C standing alone does not prove that the debt was discharged as a matter of law, the debt in fact may have been discharged. 

XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX 1099c