Consumer complaint received 2025-11-14 00:00:00
Product: Debt collection — I do not know
Issue: Attempts to collect debt not owed — Debt is not yours
Company: NAVY FEDERAL CREDIT UNION
State: MO

Complaint narrative:
This complaint concerns a long-standing and unresolved issue involving the reporting of an account furnished by Navy Federal Credit Union ( Navy FCU ) that continues to appear on my consumer credit files as a charge-off or collection account despite being reported as paid. I have made repeated and lawful efforts under the Fair Credit Reporting Act ( FCRA ) and Fair Debt Collection Practices Act ( FDCPA ) to obtain full validation and procedural verification of this account. To date, neither the credit bureaus nor Navy FCU have produced documentation demonstrating that the information being furnished is accurate, current, or lawfully verifiable.

The purpose of this complaint is to document what occurred, outline the actions I have taken to resolve the matter, describe how the company and the credit reporting agencies have responded, and request that the Consumer Financial Protection Bureau ( CFPB ) ensure compliance with federal consumer-protection statutes.

1. Background and Discovery of the Issue When reviewing my credit reports in XXXX and again in XXXX, I discovered that Navy FCU was furnishing an account listed as a charge-off or collection with a XXXX balance. The account was shown as paid but still categorized under derogatory status. This classification misleads lenders and affects my creditworthiness because it implies ongoing delinquency or loss to the creditor even though no debt remains outstanding. 

The first instance of discovery occurred in XXXX, when I noticed inconsistent reporting among the three credit bureaus. One bureau showed the account as a collection/charge-off paid, another as closed derogatory, and the third as paid/closed. The reporting dates also varied by several months, suggesting that the information may have been transmitted through automated systems rather than verified manually. 

Because the FCRA requires credit reporting agencies to maintain procedures to ensure maximum possible accuracy, I immediately began the formal dispute process to determine how Navy FCUs information had been verified. 

XXXX. Steps I Took to Resolve the Issue Between XX/XX/XXXX and XX/XX/XXXX, I submitted multiple written disputes to each of the major credit bureausXXXX XXXX XXXX XXXX. Each dispute requested a full procedural investigation and validation of the Navy FCU account pursuant to FCRA 609 ( a ) and 611 ( a ). Specifically, I asked for : A description of the procedure used to determine the accuracy and completeness of the information. 

The name, address, and telephone number of the furnisher ( Navy FCU ) that provided or verified the data. 

Copies of all documents Navy FCU supplied during the reinvestigation process. 

The method used to verify the informationmanual review, electronic verification via XXXX, or third-party submission. 

The date of the last verification and the data source consulted. 

I also sent a direct validation request to Navy FCU under FCRA 623 ( a ) ( 1 ) and FDCPA 809 ( b ), asking the institution to provide documentary evidence showing : The original signed credit agreement or contract.

Complete payment history demonstrating the alleged delinquency or charge-off event. 

Written authorization or policy permitting continued reporting of a paid charge-off. 

Evidence that the information transmitted to the credit bureaus was verified by a responsible employee rather than through automated batch processing.

Each letter was sent via certified mail with proof of delivery to preserve an audit trail.

3. Responses from Credit Bureaus and Navy FCU The credit bureaus each replied with standard form letters stating that the information had been verified as accurate. None provided any description of the verification procedure as required by FCRA 611 ( a ) ( 6 ) ( B ) ( iii ). When I requested the specific documentation used to confirm the Navy FCU account, I received no documentsonly generic statements claiming that the furnisher confirmed the data.

Navy FCU did not provide copies of a signed agreement, charge-off notice, or payment ledger. Instead, the institution issued a brief correspondence stating that the account was reported accurately. The response did not include the original contract or payment history demonstrating the legitimacy of the charge-off notation. 

At no point was I given access to the documentation that would confirm how the account was validated or what evidence supported the continued derogatory reporting. 

4. Why This Reporting Is Inaccurate and Misleading The disputed Navy FCU account presents multiple compliance problems under federal law : Contradictory Reporting : The account is marked paid yet still coded as a charge-off or collection. A paid account can not simultaneously represent an unpaid loss. This dual coding misleads creditors and violates FCRA 607 ( b ), which requires maximum possible accuracy. 

Lack of Current Balance Verification : Since the account shows a XXXX balance, continued derogatory classification implies an ongoing default without factual basis. 

Failure to Verify Documentation : No original account documents or payment records have been produced. Without such verification, the information is legally unverifiable under FCRA 611 ( a ) ( 5 ) ( A ) and must be deleted.

Improper Furnishing After Settlement or Charge-Off : If Navy FCU no longer owns the account or has closed it as paid, continued reporting as a charge-off violates FCRA 623 ( a ) ( 1 ) ( A ), which prohibits furnishers from reporting information they knowor should knowto be inaccurate. 

Procedural Negligence by Credit Bureaus : The bureaus reliance on automated electronic responses through the XXXX system constitutes a failure to perform a reasonable reinvestigation, as required by XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXX XXXX. XXXX ), where the court ruled that a bureau can not rely blindly on a furnishers response. 

Violation of FDCPA 807 ( 8 ) : If any collection notation remains, it falsely represents the legal status of the debt.

In essence, the current reporting conveys a misleading narrative to creditors : that I once defaulted and that the account remains derogatory, when in fact it has been resolved and carries no outstanding balance.

5. How This Situation Has Affected Me The inaccurate reporting by Navy FCU and the failure of the bureaus to correct it have caused ongoing harm, including : Lower credit scores across all three bureaus.

Denial or less favorable terms on credit applications.

Difficulty obtaining housing and insurance at fair rates.

Reputational harm through dissemination of misleading financial data.

Emotional distress from repeated disputes yielding no transparency.

Each month the erroneous derogatory entry remains, it is re-published to lenders and third parties, compounding the damage.

6. Lack of Compliance with FCRA Timelines and Obligations Under FCRA 611 ( a ) ( 1 ) ( A ), a credit bureau must complete a reinvestigation within 30 days. All three bureaus closed their investigations within approximately 10 days of receiving my disputean interval too short for meaningful document reviewsuggesting that only an automated verification occurred.

Moreover, FCRA 611 ( a ) ( 6 ) ( B ) requires that, upon completion of a reinvestigation, the bureau provide a description of the procedure used to determine accuracy. None of the bureaus complied with this obligation.

Under FCRA 623 ( b ), a furnisher like Navy FCU must conduct its own investigation upon receiving notice of a dispute from a bureau, review relevant information, and report back accurately. The absence of supporting documents implies that no substantive investigation occurred. 

XXXX. The Evidence Gap and Procedural Deficiencies The heart of this issue is the complete absence of an evidence trail. Neither Navy FCU nor the credit bureaus have provided : A copy of the original credit application or loan agreement.

Account statements or transaction history verifying the alleged default.

Documentation of the charge-off decision or date.

A record showing that the account remains within the statute of limitations for reporting.

Any correspondence demonstrating consumer notification of the charge-off.

Without this information, no party can claim that the data is accurate or verifiable. Continuing to publish the information without proof constitutes reckless disregard for truth and violates FCRA 616 and 617, which impose civil liability for willful or negligent noncompliance.

8. Applicable Statutes and Legal Precedents Several provisions of federal law govern this dispute : FCRA 602 ( a ) : Establishes Congresss intent to ensure fairness, accuracy, and privacy in credit reporting.

FCRA 607 ( b ) : Mandates reasonable procedures for maximum possible accuracy.

FCRA 611 ( a ) : Requires reinvestigation and correction or deletion of inaccurate data.

FCRA 623 ( a ) : Imposes a duty on furnishers to provide accurate information.

FCRA 623 ( b ) : Requires furnishers to investigate upon receiving disputes.

FDCPA 809 ( b ) : Requires debt collectors to validate debts before continuing collection or reporting. 

In addition, court decisions such as XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX, XXXX, and XXXX XXXX XXXX XXXX XXXX Bank affirm that cursory or automated verification procedures fail to satisfy the FCRAs standard of reasonable investigation. 

XXXX. Pattern of Systemic Deficiency This dispute highlights a broader systemic problem affecting consumers : the over-reliance on automated dispute resolution systems by both furnishers and credit bureaus. When a consumer submits a dispute, the credit bureau typically assigns a two-digit code through e-OSCAR, which is sent electronically to the furnisher. The furnisher often responds with a one-word status such as verified without attaching documentation. The bureau then updates the consumers file as verified.

In this case, Navy FCU appears to have confirmed the account electronically without providing evidence, and the bureaus accepted that response without scrutiny. This process fails the reasonableness test required under federal law and effectively denies consumers a genuine reinvestigation.

10. Continued Harm and Attempts to Resolve After receiving unsatisfactory responses, I again disputed the account in early 2025, enclosing copies of prior correspondence and highlighting the contradictory reporting. The results were identical : each bureau marked the item as verified.

I also attempted to reach Navy FCUs credit reporting department directly by phone and through written correspondence. My requests for documentation went unanswered or were redirected to the bureaus. As of this filing, no party has provided validation or evidence.

Because all internal remedies have been exhausted, I am submitting this complaint to the CFPB to request oversight and enforcement.

11. Why the Current Situation Violates Federal Standards The current handling of this dispute violates multiple federal standards : Failure to provide procedural details as required by FCRA 611 ( a ) ( 6 ) ( B ) ( iii ).

Failure to delete unverifiable data as required by FCRA 611 ( a ) ( 5 ) ( A ).

Failure to maintain reasonable procedures to ensure accuracy under FCRA 607 ( b ).

Failure of the furnisher to conduct a meaningful investigation under FCRA 623 ( b ) ( 1 ).

Failure to provide validation prior to continued reporting under FDCPA 809 ( b ).

These combined failures represent systemic non-compliance rather than an isolated clerical error.

12. Requested CFPB Involvement I am asking the CFPB to ensure that Navy FCU and the credit bureaus : Conduct a full reinvestigation with documentation.

Provide the consumer with copies of all verification records.

Remove or correct any unverifiable or inaccurate data.

Review internal dispute procedures for compliance with federal law.

Implement policy changes preventing similar failures in the future.

This oversight is necessary because individual consumers lack access to the internal records and technical systems that would reveal how the disputed information was verified.

13. Broader Impact and Policy Considerations The Navy FCU case illustrates a larger issue within the credit-reporting ecosystem : consumers bear the burden of proof while furnishers and bureaus rely on automated confirmation loops that lack transparency. The CFPB has documented this problem in multiple bulletins, emphasizing that furnishers must provide substantive documentation when responding to disputes.

Ensuring that this case receives a thorough, documented reinvestigation will help reinforce best practices across the industry and protect other consumers from similar procedural negligence.

14. Expected Corrective Actions Based on the facts and the law, the following corrective actions would constitute a fair resolution : Immediate deletion of the Navy FCU charge-off or collection entry if documentation can not be produced.

Written certification from Navy FCU affirming that any remaining information is complete and accurate.

Delivery of the procedural description and evidence used during reinvestigation.

Updated credit reports reflecting correction or deletion within 30 days.

Notification to all recent credit report recipients under FCRA 611 ( d ) that corrections have been made.

15. Ongoing Monitoring and Prevention To prevent recurrence, Navy FCU and the credit bureaus should : Train staff to distinguish between paid accounts and true charge-offs.

Require original documentation for verification rather than accepting automated confirmations.

Audit furnishers with high dispute rates.

Provide consumers with online access to reinvestigation logs and supporting files.

These actions would bring the institutions into full compliance with federal law and rebuild consumer trust.

16. Summary In summary, this complaint arises because Navy FCU continues to furnish an account that is reported inconsistently and inaccurately across multiple credit bureaus, with contradictory coding that simultaneously labels it paid and derogatory. Despite numerous disputes and validation requests, neither the bureaus nor Navy FCU have produced evidence proving that the data is accurate or verifiable. 

The FCRA and FDCPA require transparency, documentation, and fairness in credit reporting. Those standards have not been met. The ongoing dissemination of unverifiable information constitutes a violation of federal law and has caused tangible harm. 

17. Conclusion I am requesting CFPB assistance to ensure that Navy FCU and the credit bureaus fulfill their legal duties to investigate thoroughly, validate with documentation, and correct or delete any information that can not be verified. I also ask that the CFPB monitor their compliance to prevent future recurrence.

Consumers have a right to accurate, complete, and verifiable information in their credit files. That right has been denied in this case. A fair resolution requires a transparent reinvestigation, production of supporting records, and correction or deletion of the disputed entry.

I appreciate the Bureaus attention to this matter and its continued efforts to enforce consumer-protection laws.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation