An Interesting REPO Reporting Case

Discussion in 'Credit Talk' started by jam237, May 10, 2012.

  1. jam237

    jam237 Well-Known Member

  2. Heather L

    Heather L Well-Known Member

    Hi Jan237,

    If you would like to start a discussion about this case, maybe summarize it for us a little. This case is a lot to read in our free time. Thanks! Heather with BoostMyScore.NET
     
  3. jam237

    jam237 Well-Known Member

    It's only 41 pages... :) Basically... Short version...

    The plaintiff's son borrowed her ex-husbands car which was being leased. The car was pulled over by an officer, and the car was seized for illegal substances in someone's possession.

    The leaser repossessed the car under a clause which is extremely vaguely written.

    They reported on the plaintiff's credit report that it was REPOSSESSED; which actually prevented the plaintiff from obtaining a loan to cure the demand to pay-off the lease. She disputed the trade line twice.

    First dispute "I never paid late", along with the additional comments "Never late paying. . . . This is not a real repossession. Please investigate. Honda put the
    adverse on my credit report. [Household Finance] would have given me a loan to pay Honda off, but it was already put on the credit report as repossession."

    TransUnion processes the dispute by sending an ACDV that said. "[c]laims company will change. Verify all account information.", they omitted the never paid late, or any mention of the repossession.

    Honda only verified that the information was correct, and only updated the investigation date.

    A few months later, she sends a second dispute, and said "I request you reinvestigate the American Honda Finance listing . . . again. There was no default in payments, all the payments were made on time. The vehicle was improperly repossessed when it was being driven by my son’s girlfriend. There was no default and the credit report should not read repossession."

    Again TransUnion sent an ACDV to Honda asking that they verify her present and previous account status, payment historical profile, payment rating, special comment, and compliance condition codes.

    Honda again verified the tradeline as accurate, and only updated the reinvestigation date.

    The plaintiff then filed a suit against Honda, the repossession company, and TransUnion.

    The relevant causes of action is whether reporting a REPOSSESSION for a REPOSSESSION which is not caused by default of payments is false reporting, because a REPOSSESSION is seen as synonymous as REPOSSESSION for NON-PAYMENT.

    "Whether a reinvestigation conducted by a furnisher in response to a consumer’s notice of dispute is reasonable thus depends in large part on the allegations made by the consumer and the notice of the allegations provided to the furnisher by the consumer reporting agency." pg 20.

    Because the first dispute ACDV didn't contain notations to verify payment history, and the repossession, Honda met its requirements under the FCRA, however in the second dispute, the ACDV did contain notations to verify the payment history, and the repossession, but there is no indication that Honda performed an investigation more thorough than the cursory investigation that is routine. "The evidence suggests that AHFC discounted this dispute because it believed that plaintiff’s credit report did not reflect late payments and that “there was no question” that there had not been late payments on plaintiff’s account." pg 22-23.

    "Given the plain meaning of the term repossession—which, as explained below, see infra Part IV.A, implies non-payment—this dismissal of plaintiff’s claim by AHFC may not have been reasonable. Thus, with respect to this notice of dispute, it is for the jury to determine whether AHFC’s investigation and response to Trans Union was consistent with the requirements of 15 U.S.C. § 1681s-2(b)(1)." pg 23.
     
  4. jam237

    jam237 Well-Known Member

    In Re: TransUnion

    pg. 27-31

    The next part of the decision involving TransUnion is about the reasonableness of the investigation.

    The court ruled that it would be unrealistic for TU to obtain a copy of the actual contract to determine whether or not it was a 'real repossession' especially because that was one of the tasks that the court was currently being asked to do in the case, however in both plaintiff's disputes, she disputed the payment history, so the court says even though it wouldn't be reasonable to have TU go through the contract to determine whether or not there was in fact a 'real repossession', they did have a responsibility to ensure that the reporting of the 'repossession' wasn't misleading enough to be inaccurate. There isn't enough evidence to prove that TU's investigation was sufficient to balance the "NEVER LATE" = "REPOSSESSION" question.
     
  5. jam237

    jam237 Well-Known Member

    There is a good start of the summary of the case... :)
     
  6. Heather L

    Heather L Well-Known Member

    Thank you for summarizing this for everyone. I never even thought about a situation like this. I am sure that if happens more often then we might think. If this is why we need to review our credit reports more often, and don't your son's girlfriend drive your car. :)
    Good thing there are site like creditnet.com to help people play the credit score game.
    Thanks! Heather with BoostMyScore.NET
     

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