Consumer complaint received 2025-05-09 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: Spring Oaks Capital, LLC
State: TX

Complaint narrative:
Subject : Inaccurate Credit Reporting and Improper Debt Sale Experian Dispute To Whom It May Concern, I am writing to file a formal complaint against Experian regarding the improper handling of a credit dispute and the questionable reporting and sale of a debt previously charged off for tax purposes. 

On XX/XX/XXXX, at approximately XXXXXXXX XXXX, I submitted a dispute through Experian regarding an account originally held by XXXX XXXX. The status on my credit report for this account indicates XXXX XXXX XXXX. 

However, I received a response from XXXX  on XX/XX/XXXX, stating that the dispute was completed. This extremely short turnaround time ( less than XXXX hours ) raises serious concerns about whether a proper and thorough investigation was conducted, especially given that I have verified the debt is now listed under a different entity, Spring Capital Oaks LLC a debt buyer who has apparently acquired the account. 

When I contacted XXXX XXXX, I requested a Form 1099-C, which is issued when a debt is canceled or written off for tax purposes. I was informed that such a form exists for this account. Based on IRS regulations and relevant consumer protection laws, a creditor can not sell or assign a debt that has been canceled and reported as income to the IRS. Specifically : IRS Publication 4681 explains that when a debt is discharged and a 1099-C is issued, the creditor has effectively forgiven the debt and it is no longer collectible. 
Under the Fair Credit Reporting Act ( FCRA ), 15 U.S. Code 1681i ( a ), credit bureaus are required to conduct a reasonable investigation into disputes. Completing an investigation in less than XXXX hours especially involving a transferred or sold account does not appear to meet this standard. 
Additionally, FTC guidance and case law have established that reselling a canceled debt can constitute deceptive and unfair practices, especially if it results in continued collection efforts or credit reporting. 

Therefore, I believe Experian has failed in its duty to : XXXX. Conduct a legitimate investigation in response to my dispute, XXXX. Correct inaccuracies on my credit report, XXXX. Prevent the reappearance or double collection of canceled debt. 

I am requesting the CFPB to investigate this matter and ensure that : The account is accurately updated to reflect that the debt was canceled and should not have been sold, Experian is held accountable for failing to conduct a proper investigation, Any related collections or trade lines by Spring Capital Oaks LLC are also reviewed for legitimacy and compliance. 

Please let me know if you need additional documentation. I am prepared to provide supporting call logs, letters, and any forms received from the original creditor. 

Sincerely, XXXX XXXX XXXX XXXX XXXX XXXX XXXX, Tx XXXX XXXX XXXX last XXXX of ss XXXX XXXX

Company response to consumer: Closed with explanation