Consumer complaint received 2024-11-01 00:00:00
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Incorrect information on your report — Account status incorrect
Company: DISCOVER BANK
State: PA

Complaint narrative:
Discover is illegally reporting negative items on my consumer report, specifically late payments. 

Discover has been and is currently treating payments on my credit card account under my open end consumer credit plan as late without utilizing reasonable procedures designed to ensure that each periodic statement including the information required by 15 U.S.C. 1637 of the Truth In Lending Act ( TILA ) was delivered to me before the payment due date. Also, Discover has failed to meet additional requirements contained in the regulations prescribed by the Consumer Financial Protection Bureau ( CFPB ) which are designed to carry out the purposes of the TILA. 

15 U.S.C. 1637 ( i ) mandates that a creditor must provide written notice of any significant change in terms, as defined by the CFPBs rules, at least 45 days before the change takes effect. 12 CFR 1026.9 ( c ) ( 2 ) ( ii ) specifies that a " significant change in account terms '' includes an increase in the required minimum periodic payment. Accordingly, 12 CFR 1026.9 ( c ) ( 2 ) ( i ) ( A ) requires a creditor to deliver written notice of such changes at least 45 days prior to the effective date to each affected consumer. Further, 12 CFR 1026.9 ( c ) ( 2 ) ( iv ) mandates that this advance notice must include specific information, including but not limited to, the amount of any increase in the required minimum periodic payment, a statement that account terms are being changed, the effective date of these changes, and adherence to prescribed format requirements for such notices. 

As of today, Discover has reported my account as 180 days passed due between XX/XX/year>, and XX/XX/year> ; resulting in XXXX consecutive late payments on my consumer report. The following significant changes in my account terms are noted with discrepancies in the required XXXX notice period : Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment payment : {$360.00}. Effective date : XX/XX/year>. 
Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment : {$740.00}. Effective date : XX/XX/year> Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment : {$970.00}. Effective date : XX/XX/year> Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment : {$1200.00}. Effective date : XX/XX/year> Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment : {$1400.00} Effective date : XX/XX/year> Periodic statement received XX/XX/year>. Increase in the required minimum periodic payment : {$1700.00}. Effective date : XX/XX/year> The CFPBs guidelines confirm that Discover was obligated to provide a written advance notice for each of these significant changes at least 45 days prior to their effective dates. Failure to do so constitutes a violation of 15 U.S.C. 1637 ( i ) of TILA, and does not comply with the notice requirements in 12 CFR 1026.9 ( c ) ( 2 ) ( i ) designed to protect consumers.

Legal implications arise from Discover 's non-compliance with TILAs requirements, potentially triggering both civil and criminal liability. Under 15 U.S.C. 1611, any willful and knowing violation of TILA, including failure to provide accurate disclosures as required, shall result in a fine of up to {$5000.00} and/or imprisonment for up to one year. Additionally, 15 U.S.C. 1640 establishes that a creditor who fails to comply with any requirement imposed under TILA is liable for actual damages incurred by the consumer, twice the amount of any finance charge related to the violation, as well as the costs of a successful legal action, including reasonable attorneys fees.

These repeated violations not only undermine the regulatory framework established by the Truth in Lending Act but also have directly damaged my financial standing. Discovers failure to provide the required 45-day notices for significant changes to my account terms has resulted in inaccurate and unfair reporting of late payments, ultimately harming my creditworthiness and limiting my access to fair financial opportunities. By neglecting their obligation to implement reasonable procedures and timely notifications, Discover has compromised the protections intended by Congress to safeguard consumers from precisely this kind of financial harm and instability. 

This pattern of non-compliance is both detrimental to consumers and disruptive to the integrity of fair credit practices. The Truth in Lending Act mandates these disclosures to prevent unjust financial impacts and assure consumers are not misled or unfairly penalized. I urge the Consumer Financial Protection Bureau to uphold its duty to enforce these essential protections. Immediate action is necessary to hold Discover accountable, to rectify this harm, and to ensure full compliance with TILA.

Company response to consumer: Closed with explanation