Consumer complaint received 2025-01-09 00:00:00
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Problem with a company's investigation into an existing problem — Their investigation did not fix an error on your report
Company: Experian Information Solutions Inc.
State: CA

Complaint narrative:
Subject : Complaint Regarding Ally Financials Furnishing of Information to Consumer Reporting Agencies in Violation of UCC 3-203 ; 1681i ( a ) ( 5 ) ( A ) : CRAs must promptly delete or modify inaccurate or unverifiable information. 

Complaint Description : This complaint is being filed against Experian, XXXX, XXXX and XXXX XXXX for unlawfully reporting information regarding accounts ending Acct # XXXX and Acct # XXXX. XXXX XXXX continued furnishing of this information constitutes a clear violation of consumer protection laws and Uniform Commercial Code ( UCC ) 3-203, resulting in irreparable harm to my creditworthiness and reputation. The consumer reporting agencies Experian, XXXX, and XXXX must report accurate information 15 U.S.C. 1681e ( b ) - Accuracy of Reports- Whenever a consumer reporting agency prepares a consumer report, it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates. 15 U.S.C. 1681i - Dispute Procedures - This section requires CRAs to investigate disputes made by consumers regarding inaccurate or incomplete information in their credit files. If inaccuracies are found, the CRA must correct or delete the information promptly. 



Legal Basis for Complaint : UCC 3-203 UCC 3-203 governs the transfer of an instrument and establishes that any transfer, whether or not it constitutes a negotiation, vests the transferee with only those rights of the transferor to enforce the instrument. If the transferor has relinquished or lost its rights to enforce the instrument, the transferee can not acquire greater rights than the transferor. 

Moreover, UCC 3-203 ( c ) specifies that a transferee can not acquire rights of a holder in due course by a transfer, directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality affecting the instrument, unless otherwise agreed. If an instrument is transferred for value and the transferee does not become a holder because of lack of indorsement by the transferor, this further invalidates the transferees rights. 

These provisions render XXXX XXXX claims of standing or enforcement rights legally void. XXXX XXXX actions to report this information violate both federal consumer protection laws and the principles of UCC 3-203.

How XXXX XXXX Violated UCC 3-203 : Upon examination of the accounts referenced above and through a forensic audit, the following facts demonstrate that XXXX XXXX lacks any enforceable right to furnish or report information to consumer reporting agencies : XXXX XXXX  Assigned and Transferred the Original Instrument : XXXX XXXX  securitized and transferred the underlying promissory note associated with the accounts to a securitization trust as part of a structured finance transaction. This transfer included the sale and assignment of rights to enforce the instrument. 
Under UCC 3-203, XXXX XXXX transfer of the instrument divested it of any rights to enforce or claim an interest in the underlying obligation. 
XXXX XXXX Can not Acquire Rights of a Holder in Due Course : Pursuant to UCC 3-203 ( c ), XXXX XXXX can not claim rights as a holder in due course because of its involvement in improper handling, transfer, or failure to indorse the instrument. Additionally, fraud or illegality in the securitization process affecting the instrument renders XXXX claims invalid. 
Failure to Perfect a Security Interest : As per UCC 9-203, XXXX XXXX failed to perfect a security interest in the collateral associated with the accounts, nor did it retain standing to assert rights over the instrument. Without a perfected lien, XXXX XXXX can not claim ownership or enforcement rights. 
Reporting to Consumer Reporting Agencies Is Unauthorized : By transferring the note and losing its rights under UCC 3-203, XXXX XXXX no longer has any legal or equitable standing to furnish information regarding these accounts to consumer reporting agencies. Reporting these accounts constitutes false and misleading information, violating the Fair Credit Reporting Act ( FCRA ) and 15 U.S.C. 1681s-2, which requires furnishers to ensure accuracy and legality in the information they report. 
Failure to Respond to Negotiable Instrument Submission : XXXX XXXX has previously failed to process or formally reject a negotiable instrument submitted in accordance with UCC 3-311, further demonstrating its lack of legal standing and bad faith in handling these accounts. 
Relief Requested : I respectfully request that the CFPB compel XXXX XXXXl and the XXXX consumer reporting agencies ( XXXX, Experian, and XXXX ) to immediately : Cease Reporting the Accounts : XXXX XXXX must delete all reporting related to Acct # XXXX and Acct # XXXX from my consumer reports, as it lacks the legal authority to furnish such information under UCC 3-203 and UCC 3-203 ( c ). 

Provide Proof of Standing : If XXXX XXXX claims the right to enforce or report on these accounts, it must submit clear and verifiable evidence demonstrating : Proof of ownership or valid assignment of the instrument. 
Compliance with UCC 9-203 regarding lien perfection XXXX 
Legal authority to report these accounts after transferring the underlying instrument. 
Investigate and Remove Inaccuracies : The CFPB should require all consumer reporting agencies to investigate the accuracy of the information provided by XXXX XXXX. If XXXX fails to provide verifiable proof of its standing, the accounts must be deleted as unsubstantiated and inaccurate under the FCRA. 

Provide a Written Explanation : XXXX XXXX should be required to provide a detailed explanation for its continued reporting of these accounts despite its lack of standing under UCC 3-203 ( c ) and other applicable laws. 

Conclusion : XXXX XXXX continued reporting of these accounts to consumer reporting agencies is unlawful under UCC 3-203 ( c ) and violates federal consumer protection laws, including the FCRA. By transferring the note, XXXX XXXX relinquished its rights to enforce or report the obligation, making its furnishing of this information unauthorized and harmful. I request the CFPBs intervention to address this matter promptly and ensure compliance with applicable laws.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation