Consumer complaint received 2025-10-31 00:00:00
Product: Student loan — Private student loan
Issue: Problem with a company's investigation into an existing problem — Their investigation did not fix an error on your report
Company: KEYCORP
State: MI

Complaint narrative:
On XX/XX/XXXX, and in response to CFPB XXXX XXXX. XXXX, XXXX sent KeyBank a direct dispute pursuant to 12 C.F.R. 1022.43. See CFPB XXXX. The dispute identified facially inconsistent Date-of-First-Delinquency ( DoFD ) reporting among Equifax, Experian, and TransUnion and requested : ( a XXXX the furnished DoFD for each CRA ; ( b ) the date KeyBank completed its reinvestigation ; ( c ) a description of the steps taken in that reinvestigation ; and ( d ) the factual basis for any continued reporting of a charge-off. See CFPB XXXX. 

On XX/XX/XXXX XXXX days later KeyBank sent a form response stating only that prior correspondence from XXXX and XXXX had found the reporting accurate and complete. KeyBank did not identify any DoFD furnished to XXXX XXXX, or XXXX  did not identify any investigation steps performed in XX/XX/XXXX ; did not state when any reinvestigation was completed ; and did not provide any account-level record supporting the current reported status. See Written Response Packet XXXX, KeyBank XXXX XXXX. XXXX. 

KeyBanks XX/XX/XXXX packet fails to satisfy 12 C.F.R. 1022.43 ( e ) ( 1 ) ( 3 ) and 15 U.S.C. 1681s-2 ( b ) in that it : Does not identify the Date of First Delinquency ( DoFD ) furnished to each CRA.

Does not describe any investigation steps taken in October 2025 as required by 12 C.F.R. 1022.43 ( e ) ( 1 ) ( i ) ( ii ). 
Does not state when any reinvestigation was completed. 
Does not include any record establishing the factual basis for continuing to report the Accounts as charged off. 
Provides no XX/XX/XXXX billing statement, even though KeyBanks own servicer, XXXX, previously stated that the forbearance was processed on XX/XX/XXXX and brought your account current with payment due on XX/XX/XXXX. ( XXXX XXXX to CFPB XXXX / XXXX at XXXX XXXX. ) Instead of providing current investigation results, KeyBank re-sent historical documents, including copies of response letters from XX/XX/XXXX ; XX/XX/XXXX ; and XX/XX/XXXX, along with Monthly Billing Statements dated XX/XX/XXXX through XX/XX/XXXX and past-due notices dated XX/XX/XXXX and XX/XX/XXXX. 

Defective Billing Cycle and Inaccurate Date-of-First-Delinquency On XX/XX/XXXX, KeyBank approved a forbearance retroactively covering XXXX months of XX/XX/XXXX through XX/XX/XXXX. XXXX servicer, XXXX, later acknowledged that the forbearance was processed on XX/XX/XXXX and brought your account current with payment due on XX/XX/XXXX. However, XXXX further admitted that the forbearance approval was not communicated to us by your lender until after the XX/XX/XXXX billing statement had already been generated. As a result, the XX/XX/XXXX statement reflected delinquent balances from XX/XX/XXXX through XXXX XXXX which, by XXXX own admission, were not in fact due. No corrected or revised XX/XX/XXXX billing statement was ever issued to reflect the retroactive cure. 

The next statement generated by the servicer was dated XX/XX/XXXX. Although that statement purported to recognize the forbearance by recalculating outstanding amounts, it simultaneously listed Current Due Date : XX/XX/XXXX and Days XXXX XXXX as of XX/XX/XXXX : XXXX. The XX/XX/XXXX due date was carried forward from the unrevised XX/XX/XXXX statement that was created prior to the lenders notice of forbearance. Accordingly, the XX/XX/XXXX statement internally contradicted itself by treating as past-due a payment obligation derived from an invalid and unrevised billing cycle. 

Because no corrected XX/XX/XXXX statement was ever generated after the account was brought current, there was no lawful or accurate first payment due following the forbearance cure. Nevertheless, KeyBank and its servicer began aging delinquency from the fictitious XX/XX/XXXX due date, and KeyBank thereafter furnished that same date as the Date of First Delinquency ( DoFD ) to XXXX XXXX and XXXX The DoFD so reported does not correspond to any payment that was actually due and unpaid after the account was last brought current, rendering the furnished information facially inaccurate under 15 U.S.C. 1681s-2 ( b ) and 1681c ( c ) ( 1 ).

KeyBanks failure to regenerate a corrected billing statement after the XX/XX/XXXX cure, and its reliance upon an unrevised and erroneous XX/XX/XXXX due date to establish delinquency, demonstrate that no reasonable investigation was conducted in response to Complainants direct dispute as required by 12 C.F.R. 1022.43 ( e ) ( 1 ) ( 3 ). By summarily ratifying system-generated data that it knewor should have knownwas based on an invalid billing cycle, KeyBank willfully furnished and verified inaccurate information. 

KeyBank and its servicer failed to provide Complainant with a billing statement or equivalent written notice with sufficient advance time to remit payment following the XX/XX/XXXX forbearance cure. The prior XX/XX/XXXX statement was generated before the lender communicated the forbearance approval and contained materially inaccurate delinquency information, while no corrected statement was issued thereafter. As a result, Complainant did not receive notice of any valid post-forbearance payment obligation with adequate time to pay by the purported XX/XX/XXXX due date. This failure to provide timely and accurate billing notice constitutes a violation of the Truth in Lending Act, 15 U.S.C. 1638 et seq., and Regulation Z, 12 C.F.R. 1026.17 and 1026.18, as well as an unfair or deceptive billing practice under the Acts general provisions. 


Failure to Issue a Revised Statement No Valid Billing Cycle Established KeyBanks servicer, XXXX, has admitted that KeyBank approved a retroactive forbearance on XX/XX/XXXX, covering XX/XX/XXXX through XX/XX/XXXX, and that the forbearance was processed on XX/XX/XXXX and brought your account current with payment due on XX/XX/XXXX. However, XXXX also conceded that the forbearance approval was not communicated to us by your lender until after the XX/XX/XXXX billing statement had been generated. The XX/XX/XXXX statement therefore reflected delinquent amounts from months that were no longer legally due once the forbearance was applied. Despite this material change, no revised XX/XX/XXXX billing statement was ever issued. 

Because no corrected statement was generated following the forbearance cure, no valid billing cycle was ever established for repayment to resume. The unrevised XX/XX/XXXX statement, created before the forbearance notice, could not serve as the first post-forbearance bill because it demanded payment on amounts already suspended or cancelled by the retroactive approval. Likewise, the subsequent XX/XX/XXXX statement could not create a new billing cycle because it listed Current Due Date : XX/XX/XXXX a date inherited from the invalid XX/XX/XXXX billing event and continued to treat the account as past due without any lawful statement establishing that due date. 

Under the Truth in Lending Act and Regulation Z, billing cycles must be based on accurate information and must provide the consumer with adequate advance notice of the payment due date. See 15 U.S.C. 1638 ( a ) ; 12 C.F.R. 1026.17 and 1026.18. By failing to issue a corrected post-forbearance statement, KeyBank deprived Complainant of any valid billing cycle or payment notice and thereafter reported a Date of First Delinquency ( DoFD ) derived from an invalid and unrevised billing event. The absence of a properly established billing cycle renders all subsequent delinquency and charge-off reporting facially inaccurate under 15 U.S.C. 1681s-2 ( b ) and 1681c ( c ) ( 1 ). 

Omission of XX/XX/XXXX Statement and Deceptive Response to Direct Dispute On or about XX/XX/XXXX, in response to Complainants XX/XX/XXXX direct dispute under 12 C.F.R. 1022.43, KeyBank transmitted a Written Response Packet purporting to confirm that the credit reporting associated with this account has been determined to be accurate and complete. The packet enclosed monthly billing statements beginning in XX/XX/XXXX, each of which asserted that Complainants Current Due Date was XX/XX/XXXX and that the loan was past due as of XX/XX/XXXX. KeyBank did not include, and did not disclose the absence of, any billing statement generated for XX/XX/XXXX or earlier, despite previously acknowledging through its servicer, XXXX, that ( i ) KeyBank had approved a retroactive forbearance on XX/XX/XXXX covering XX/XX/XXXX through XX/XX/XXXX ; ( ii ) the forbearance was processed on XX/XX/XXXX and brought your account current with payment due on XX/XX/XXXX ; and ( iii ) the XX/XX/XXXX statement was generated before XXXX learned of the forbearance and therefore demanded amounts that were not, in fact, owed. 

By omitting all statements prior to XX/XX/XXXX, KeyBank concealed the fact that no corrected XX/XX/XXXX billing statement was ever issued after the retroactive forbearance was applied and that, as a result, no valid post-forbearance billing cycle was ever established. KeyBanks XX/XX/XXXX packet instead presents a misleading narrative in which delinquency is shown as having begun on XX/XX/XXXX and aged forward, while withholding the very record that would confirm whether a lawful payment obligation actually arose on that date. 

The selective production of only XX/XX/XXXX and later statements, paired with the blanket assertion that reporting is accurate and complete, constitutes ( a ) a deceptive collection practice under the Michigan Regulation of Collection Practices Act, MCL 445.251 et seq. ; ( b ) negligent misrepresentation ; and, in the alternative, ( c ) fraudulent concealment by omission, because KeyBank withheld material account-level records including any XX/XX/XXXX corrected billing statement with the intent and foreseeable effect of inducing Complainant ( and downstream users of the furnished data ) to accept a false Date of First Delinquency and a false charge-off narrative. 

Conclusion Even assuming arguendo that a charge-off were permissible at all under the circumstances, KeyBanks own records show that the accounts were treated as delinquent and charged off prematurely. Because no accurate, corrected billing statement was ever generated after the retroactive forbearance was processed on XX/XX/XXXX and no valid post-forbearance payment obligation was communicated to XXXX before XX/XX/XXXX KeyBank began aging delinquency and assessing default status off an invalid XX/XX/XXXX due date. As a result, the accounts were effectively placed into a default/charge-off posture at least one month early.

This timeline further demonstrates that the information KeyBank continues to furnish and verify regarding these loan accounts including, without limitation, the Date of First Delinquency, delinquency aging, past due notations, and any charge-off payment ratings is materially misleading. KeyBank is reporting a Date of First Delinquency that does not correspond to any lawful, post-forbearance payment obligation, and is ratifying a charge-off timeline that began before a valid billing cycle was ever established. Such conduct violates XXXX duties under 15 U.S.C. 1681s-2 ( b ), 12 C.F.R. 1022.43 ( e ) ( 1 ) ( 3 ), and constitutes deceptive collection activity under XXXX XXXX of XXXX Practices XXXX ( MCL 445.251 et seq. ). 

Willful Noncompliance and Continuing Furnishing By XX/XX/XXXX, KeyBank had been on notice for approximately XXXX years that it was reporting a Date of First Delinquency and delinquency aging that did not correspond to any lawful payment obligation following the XX/XX/XXXX forbearance cure. Despite this awareness, KeyBank continued to furnish and then re-verify as accurate and complete information it could not substantiate with any contemporaneous billing record or valid Date of First Delinquency. 

Such conduct constitutes a willful violation of 15 U.S.C. 1681s-2 ( b ) and 12 C.F.R. 1022.43 ( e ) ( 1 ) ( 3 ) under XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXX ), as interpreted by XXXX v. XXXX Fed. XXXX. Bank, XXXX XXXX XXXX ( XXXX Cir. XXXX ), XXXX v. Experian XXXX. XXXX, XXXX XXXX XXXX ( XXXX Cir. XXXX ). XXXX knowing failure to correct or substantiate its reporting after repeated noticespanning XXXX through XXXXdemonstrates reckless disregard for its statutory duties and a conscious decision to perpetuate inaccurate information it could not verify

Company response to consumer: Closed with explanation