Misleading Report is Inaccurate

Maximum Possible Accuracy
David A. Szwak

Misleading Report is Inaccurate

Postby David A. Szwak » Wed Oct 26, 2005 7:34 pm

Inaccuracy of information means more than factual truthfulness and involves an assessment of a credit report for its potential to mislead and weighing this factor against the availability of more accurate information and the burden of producing such information. Alexander v. Moore & Associates, 553 F.Supp. 948 (U.S.D.C. Haw. 1982); Koropoulos v. The Credit Bureau, Inc., 734 F.2d 37 (D.C. Cir. 1984).

David A. Szwak

Postby David A. Szwak » Tue Nov 01, 2005 5:06 am

Colletti v. Credit Bureau Services, Inc., [1981, 5th Cir.] [La.] 644 F.2d 1148,

The court held that a credit report, which stated that a bank loan applicant's furniture store charge account had been in arrears 6 months before the issuance of the report but did not mention the fact that the applicant had withheld payments on the account because of a dispute about the quality of the furniture delivered, was accurate, under 1681e[b]. In 1975, the agency received a report from the furniture store indicating that the applicant was delinquent in her payments to the store. In 1976, the applicant visited the office of the agency to investigate an adverse report which the agency had furnished to the bank. During the visit, she filed with the agency a notice of dispute about her furniture store account. Later in May 1976, the furniture store notified the agency that the applicant was no longer in arrears on her account with them, and the agency updated its files to reflect this fact. In October 1976, the store notified the reporting agency that the applicant was again delinquent in her furniture payments. The applicant resumed payments in November 1976, but was more than 4 months delinquent on the account in April 1977. The store did not notify the agency of this payment resumption. In April 1977, when the applicant made a second visit to the office of the reporting agency, she learned that the delinquency notification sent by the furniture store in November 1976 remained unamended in her credit file. She did not file a notice of dispute, and she told the reporting agency not to contact the store to verify this information. Several days later, the agency furnished to the bank a report containing this adverse information. The bank denied the applicant a loan, partially because of the report. The applicant contended that the reporting agency had a duty to reinvestigate her account after being notified of her dispute in April 1976, and that the agency's reports did not reflect her correct account balance after November 1976. The court said that the evidence showed that the agency's files were corrected to show no delinquency in May 1976, and only changed to show a delinquency again after the October 1976 delinquency notification from the furniture store. Noting that the applicant had told the agency, in April 1977, not to check the accuracy of its information, the court said that the agency's failure to check at that time to determine whether the information in its report was stale did not constitute a violation of 1681e[b]. Despite the fact that the April 1977 report had not been updated to indicate changes in the account during the 6 months immediately prior to its issuance, the court said that the report was accurate and affirmed the Court's dismissal of the applicant's suit.


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