Consumer complaint received 2025-06-07 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: Upstart Holdings, Inc.
State: FL

Complaint narrative:
Subject : XXXX XXXX XXXX XXXX Bank and Upstart XXXX for XXXX XXXX XXXX XXXX XXXX XXXX XXXX From : XXXX XXXX XXXX Address : XXXX XXXX XXXX XXXX, Unit XXXX XXXX XXXX XXXX FL XXXX XXXX : ( XXXX ) XXXX | XXXX Upstart Loan Number : XXXX ________________________________________ Parties Involved Bank : XXXX XXXX Bank, FDIC XXXX XXXX. XXXX XXXX XXXX XXXX Upstart Network , Inc . 
________________________________________ Nature of Complaint This complaint concerns a pattern of serious consumer protection violations by Upstart XXXX XXXX XXXX in its role as servicer of my loan issued through XXXX XXXX Bank. These practices reflect not only systemic deficiencies in Upstart 's consumer operations, but also a lack of adequate oversight by XXXX XXXX Bank in its third-party relationship, in violation of : Electronic Fund Transfer Act ( EFTA ) Truth in Lending Act ( TILA ) Fair Credit Reporting Act ( FCRA ) Consumer Financial Protection Act ( XXXX ) FDIC Guidance XXXX Third-Party Risk Management and Unsafe or Unsound Banking Practices ________________________________________ Summary of Allegations XXXX of Payment Status, Withholding of XXXX Processing, Improper Fee Collection On XX/XX/XXXX, Upstart confirmedboth via its online loan dashboard and by XXXX a {$70.00} payment had successfully cleared. In reality, the XXXX processing for this payment was withheld for over XXXX weeks. This delay resulted in a returned payment and the assessment of a {$15.00} return fee, which Upstart unjustly retained. 
Prior to this, on XX/XX/XXXX, Upstart had assured me during a phone call that XXXX pending {$69.00} XXXX payments would be canceled and all related fees waived, since my balance had already been satisfied through a separate one-time payment. Relying on this representation, I submitted an additional {$300.00} payment to cover the next months installment and pay down principal. 
However, Upstart failed to cancel the XXXX {$69.00} transactions as promised. Both were processed and subsequently returned, triggering additional fees. As a result, a significant portion of the {$300.00} principal payment was diverted to cover these improper charges, rather than reducing my loan balance. 
When I raised these issues with Upstart, the company dismissed my concerns, refused to review the recorded calls from XX/XX/XXXX and XXXX XXXX substantiate my claimsand declined to refund the fees assessed due to its own error. 
Legal Violation : Electronic Fund Transfer Act ( XXXX ) Improper handling and authorization of electronic payments. 
XXXX ( Unfair and Deceptive Acts and Practices ) Charging unjustified fees based on misleading representations of payment status. 

XXXX. Manual Alteration of Payment Data, Unauthorized ACH Switching In XX/XX/XXXX, Upstart altered payment dates and associated bank accounts for multiple ACH transactions without my authorization. Records on the Upstart dashboard do not reconcile with my email confirmations or external bank statements, indicating clear manual interference. 
On XX/XX/XXXX, I initiated a {$70.00} payment scheduled to post on XX/XX/XXXX. However, due to an unauthorized {$69.00} payment initiated by XXXX prior confirmation it would be canceledthe authorized {$70.00} payment returned. In response, I submitted another {$70.00} payment on XX/XX/XXXX, which was confirmed as posted and cleared on XX/XX/XXXX. However, on XX/XX/XXXX, I received an email from Upstart stating the payment had never processed, contradicting the prior confirmation. Upstart then reinitiated the payment on the next business day, but due to the unexpected delay and lack of notice, I was unable to transfer funds in time, resulting in an additional return and fee. 
The loan dashboard provides no reference to the original payment dates or cancellations. Moreover, Upstarts records show that payments I initiated from XXXX XXXX Bank were inexplicably routed to XXXX XXXX XXXX XXXX, and duplicative paymentsallegedly canceled by an Upstart agent on XXXX XXXX still presented. Specifically, XXXX separate transactions were directed to XXXX XXXX on XX/XX/XXXX, despite only XXXX {$70.00} payment having been authorized by me. 
Despite detailed documentation submitted to Upstart demonstrating these errors, the company has refused to refund the resulting fees. When I raised these concerns again in a call on XX/XX/XXXX, and during prior discussions, the supervisor abruptly disconnected after refusing to address the unauthorized actions or return the fees. 

Legal Violation : XXXX & XXXX XXXX Unauthorized changes to consumer ACH instructions. 
FTC XXXX XXXX Deceptive business practices involving manipulation of records and failure to address consumer harm. 
XXXX. Failure to Provide Monthly Loan Accounting, Balance History Since XX/XX/XXXX, I have repeatedly requested a complete, itemized accounting of my loan from Upstart, including monthly balance history, including principal and interest allocations, and all fees charged. Despite numerous formal requests, Upstart has refused to provide this information, instead directing me to the online account dashboard, which lacks the detailed records necessary for reconciliation. 
Beginning in XXXX, I identified and disputed multiple discrepancies in my loan recordsboth directly with Upstart and with the credit reporting agencies ( CRAs ). These include mismatches in payment amounts, dates, and balances. For instance, payments of {$300.00} have been reported to the CRAs as amounts less than what was actually paid. When disputed, both Upstart and the CRAs rejected the claims without explanation or investigation, despite supporting documentation. 
To substantiate my disputes, I requested Upstarts full loan history and reporting data as furnished to the CRAs. Upstart denied these requests while simultaneously asserting that its reporting is accuratedespite the fact that none of the XXXX major CRAs reflect the same data. 
In XXXX, the CRAs, unable to resolve the discrepancies due to Upstarts non-cooperation, removed portions of the payment and balance history after I submitted proof of the inconsistencies. As of XX/XX/XXXX, these issues remain unresolved and continue to negatively impact my credit profile, with no meaningful remedy offered by Upstart. 
Legal Violation : FCRA Furnisher Duties Inadequate support for correcting inaccurate credit reports. 
CFPB XXXX XXXX Denial of material account information needed for dispute resolution. 
FCRA, XXXX and XXXX ( b ) : Consumers must be able to obtain relevant documentation to substantiate disputes ; furnishers must correct or verify disputed data. 
XXXX. Material Discrepancies Between Consumer Loan Dashboard Disclosures and Credit Bureau XXXX Upstart displays XXXX version of monthly payment history on its consumer-facing loan dashboard while furnishing conflicting payment data to the credit reporting agencies ( CRAs ). This practice is both misleading and noncompliant, as the dashboard is intended to serve as a transparent reflection of what is being reported to the CRAs. 
In XX/XX/XXXX, I submitted formal disputes to Upstart and all three CRAs regarding these inconsistencies, specifically for XXXX and XX/XX/XXXX. Despite providing screenshots and supporting email correspondence demonstrating discrepancies between the dashboard and Upstarts reported data, Upstart declined to correct the information, claiming the furnished data was accurateeven when it conflicted with both the dashboard records and terms disclosed in my loan modification agreement. 
The CRAs, relying solely on electronic verification with Upstart, summarily rejected the disputes without addressing the consumer-submitted evidence. This automated dispute resolution process fails to meet the FCRA 's requirement for a reasonable investigation and perpetuates inaccurate credit reporting. 
Legal Violation : FCRA XXXX ( a ), ( b ) Inaccurate and inconsistent data furnished to CRAs. 
FTC XXXX & UDAAP Failure to ensure accuracy and transparency in consumer disclosures. 

XXXX. Refusal to Provide Loan Modification Agreement In XXXX, I entered into a loan modification agreement with Upstart. Despite multiple written requests, Upstart has failed to provide a copy of the signed agreement. I have repeatedly notified Upstart of this outstanding request, but no resolution has been offered to date. 
This documentation is critical not only for my personal records and understanding of the updated loan terms, but also to support ongoing credit reporting disputes. Upstarts refusal to provide the executed agreement deprives me of access to material terms governing my account and undermines my ability to correct inaccurate credit information. 
Legal Violation : ECOA Denial of access to terms affecting consumer rights. 
XXXX XXXX material terms of a binding modification agreement. 
XXXX, XXXX XXXX. XXXX et seq. : Failing to provide a requested modification agreement and impeding resolution of a credit dispute constitutes an unfair and abusive act. 
XXXX, XXXX XXXX. XXXX ( XXXX ) : Entitles consumers to receive documentation of material changes to loan terms. 
XXXX. Deficient Dispute Resolution Processes and XXXX XXXX XXXX Upstart relies almost exclusively on email to address credit reporting disputes and account inquiries. However, its dispute-handling process is fragmented and ineffective. Communications are often initiated through new email threads with no reference to prior correspondence, leading to confusion and delays. Responses are frequently pre-templated and handled by representatives who lack authority to resolve issues or escalate them appropriately. 
Despite raising specific concerns regarding inaccuracies in my payment history across all three credit reporting agencies, formal disputes submitted to Upstart have been met with generic responses that fail to address the substance of the claims. Attempts to resolve matters by phone have proven equally unproductivecalls are either mishandled or abruptly terminated by supervisors without resolution. 
Due to these systemic communication failures and the continued reporting of inaccurate data, I have reached an impasse in obtaining adequate servicing and support from Upstart. 
Legal Violation : FCRA XXXX Failure to conduct reasonable investigation of disputes. 
ECOA Discriminatory or arbitrary handling of consumer inquiries. 
UDAAP Systemic delays, confusion, and ineffective communication processes harming consumers. 
FCRA, XXXX and XXXX ( b ) : Consumers must be able to obtain relevant documentation to substantiate disputes ; furnishers must correct or verify disputed data. 
XXXX. Abuse of Bank XXXX XXXX XXXX XXXX and XXXX Upstart operates under the banking charter of XXXX XXXX Bank to enjoy federal preemption from state usury lawsan exemption intended to facilitate legitimate banking activity, not to shield non-bank fintechs from accountability. While benefiting from this regulatory loophole, Upstart fails to uphold even the minimum service and compliance standards required of federally regulated banks. 
This hypocrisy is deeply troubling. Upstart charges interest at an annual rate of 22.3 % on the subject loanwell above the usury limits imposed by both Florida and New Jersey lawsyet does not offer the basic consumer protections expected of any bank. It routinely fails to provide transparent fee reconciliation, accurate payment records, and timely resolution of credit reporting disputes and account servicing errors. 
Unlike traditional banks with established compliance departments and clear escalation channels, Upstart appears structurally incapable of managing complex servicing issues. Its inability to respond effectively to borrower concerns underscores the risk created when fintechs exploit bank charters to evade state-level consumer protections without being held to equivalent standards of oversight and accountability. This abuse is especially concerning in light of the applicable state usury laws : Florida XXXX XXXX : XXXX XXXX XXXX. XXXX, loans under {$500000.00} are capped at 18 % annually, with anything above deemed usurious and potentially void under XXXX. Courts assess the effective rate of interest, including fees such as origination charges. 
New Jersey XXXX XXXX : XXXX XXXX. XXXX. XXXX limits interest to 6 %, or 16 % if agreed in writing. Even for corporate borrowers, New Jersey courts have struck down unconscionable interest rates and deceptive lending practices. 
The arrangement between Upstart and XXXX XXXX Bank effectively immunizes Upstart from these consumer protections while enabling it to operate like a lender without the corresponding regulatory burden. This regulatory arbitrage undermines the purpose of federal preemption and places borrowers at riskespecially when the lender fails to meet the operational, ethical, and compliance standards required of the banking system it purports to participate in. 
Legal Violation : FDIC XXXX and XXXX XXXX XXXX oversight of third-party servicers. 
XXXX XXXX XXXX XXXX XXXX XXXX XXXX ) Circumventing interest rate caps via bank partnership exemption despite non-bank conduct.

Company response to consumer: Closed with explanation