Consumer complaint received 2025-06-07 00:00:00
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Credit monitoring or identity theft protection services — Billing dispute for services
Company: DISCOVER BANK
State: TX

Complaint narrative:
XXXX XXXX XXXX XXXX XXXX XXXX XXXX, TX XXXX XX/XX/XXXX Discover Bank XXXX. XXXX XXXX XXXX XXXX XXXX, UT XXXX Re : Account Ending in XXXX Case Number : [ Insert Case Number if Applicable ] To Whom It May Concern, This letter is an UPDATED response to your correspondence regarding the above-referenced account.

Let me be clear : the practice of continuing to report a charged-off account that has likely been securitized, and simultaneously refusing to issue a 1099-C, raises serious legal and regulatory concerns. Your internal records confirm the account was charged off several years ago, yet you continue to assert that the balance is still owedwhile providing no substantiating documentation that Discover is the true owner or holder in due course of this alleged obligation.

Violations and Material Omissions Failure to Issue Form 1099-C You have failed to issue a 1099-C despite the account being charged off for over four years. Under Internal Revenue Code 6050P, a creditor must issue a 1099-C upon cancellation or discharge of a debt of {$600.00} or more. The continued monthly reporting of this charged-off account without providing a 1099-C is a violation of federal tax law and is misleading to both the consumer and regulatory agencies. If the debt has been canceled, settled, or otherwise disposed of, a 1099-C is mandatory. If the account was securitized, as industry practice strongly suggests, then Discover is not the legal party in interest and has no claim of debt.

Truth in Lending Act ( TILA ) Violations 15 U.S.C. 1666 ( a ) - ( d ) Prior to this account being charged off, Discover failed to comply with its obligations under 15 U.S.C. 1666 ( a ) - ( d ), which governs the proper procedure for addressing billing disputes. Upon receiving written notice of dispute, Discover was required to acknowledge the dispute within 30 days, and either correct or investigate and explain the matter within two billing cycles or 90 days, whichever is sooner. Discover 's failure to follow these procedures and to correct disputed items on the account is a clear violation of TILA and renders the charge-off status defective.

Fair Credit Reporting Act ( FCRA ) & Misrepresentation Under the FCRA, information furnished to consumer reporting agencies must be accurate and verifiable. Reporting a charged-off debt that may have been sold, securitized, or otherwise disposed of without evidence of current legal ownership is inaccurate and deceptive. The statement that the balance is still owed without furnishing the chain of title or proof of Discover 's legal standing amounts to a material misrepresentation under the FCRA and the Fair Debt Collection Practices Act ( FDCPA ).

Trust Indenture Act & UCC Violations If this obligation was securitizedand Discovers own SEC filings strongly suggest thisthen Discover is no longer the real party in interest. Under the Trust Indenture Act of 1939 and UCC 3-305, Discover can not enforce or report this account as a collectible asset. The FTC Holder Rule also bars the enforcement of consumer credit instruments by entities who no longer possess beneficial ownership.

Unjust Enrichment and Double Entry Accounting Discover can not simultaneously benefit from a charge-off for accounting or tax purposes, possibly receive compensation through securitization or insurance, and also continue to report and claim the balance as collectible. Doing so constitutes unjust enrichment and may rise to the level of constructive fraud and deceptive trade practices.

Demand for Immediate Action Accordingly, I demand the following : Immediate removal of the account from all consumer reporting agencies on the basis of unverifiable ownership and inaccurate, outdated reporting.

A complete accounting and chain of title for the account, including whether it was sold, assigned, or securitized, and the name of the current holder in due course.

A written explanation for why Discover has failed to issue a 1099-C despite the account being charged off over four years ago.

A formal retraction of any verified status provided to consumer reporting agencies, unless you can produce documentary proof of continued ownership and right to collect.

Failure to comply within 15 business days will result in the immediate escalation of this matter to the Consumer Financial Protection Bureau ( CFPB ), Office of the Comptroller of the Currency ( OCC ), Federal Trade Commission ( FTC ), and state attorney general offices. I am also prepared to initiate legal action for willful noncompliance, consumer fraud, and statutory damages under federal law. 

I reserve all rights and remedies, without limitation. 

Sincerely, XXXX XXXX

Company response to consumer: Closed with explanation