Identity theft has many damaging effects, and one of the most problematic for consumers is the reporting of false or fraudulent information on their credit reports. One would logically assume that US banks would be legally accountable to consumers for knowingly reporting false information on their credit reports, especially after notifying the banks that the information is false, a bank mistake, or the result of an identity theft.
However, according to federal law as stated in the "Fair Credit Reporting Act", consumers have no right to sue a bank for illegally reporting false information, even when the bank fails to respond to a consumer's demands to change or delete the false information. In short, banks can negligently issue credit to an impostor in your name, report the information on your credit report, then completely ignore your direct demands to remove the false information, all without the threat of lawsuit. Doesn't seem very "fair" does it?
A good example of this is the case of Eric Drew, where banks such as Bank of America and Chase issued credit to a hospital worker who stole Drew's identity while he was fighting a "terminal" leukemia. These banks issued credit to the impostor over the phone without verifying that Drew was actually the applicant. They then ruined Drew's credit score by reporting these fraudulent accounts on Drew's credit for almost two years. Even after Drew miraculously survived by having an experimental non-controversial umbilical cord blood stem cell transplant, he disputed the reporting of these accounts. Still the banks and the credit reporting agencies refused to take the false information off his credit report, causing him to be denied a mortgage. Drew states "This is a direct violation of my most basic rights, and the federal laws which allow this negligent behavior in credit lending and reporting are a disgrace to this country and its citizens".
It's not all bad. California Consumers like Drew finally have some hope. The California Consumer Credit Reporting Agencies Act (CCRAA) does allow consumers to hold banks responsible and sue for knowingly reporting false information. Until recently, banks have successfully used federal preemption precedents to override this more powerful CA law. No longer. Finally, consumers in CA will be able to use the CCRAA to hold banks responsible for the immense damage they are causing by their negligent lending and reporting.
The California Supreme Court and the Federal 9th Circuit Court of appeals have recently ruled to block federal preemption over the stronger CCRAA. As a result of the rulings, consumers in California can now pursue lawsuits under the stronger California statute when banks knowingly report false information. The banking industry, namely Bank of America, has filed voluminous requests seeking to have the courts reconsider their decisions, stating repeatedly that the decision will have "dramatic effects on the rights of consumers". B of A has been given an extended "stay" to decide if they want to appeal the decision to the US Supreme Court, and they are expected to do so. Of course this decision has dramatic effects on the rights of consumers, rights that should have never been taken away in the first place by the FCRA. Banks are obviously concerned that they will now be held accountable by consumers for keeping diligent records and quickly responding to identity theft complaints, which they should have been doing all along.
The financial industry's cries for sympathy are finally falling on deaf ears, both at the White House as well as in the federal courts. This newly invigorated CA law is sure to elicit similar legislation in other states. Let's hope the Supreme Court of the United States does the right thing and denies B of A an audience when they come crying again.
Drew has been fighting a "David vs. Goliath" claim for years in San Francisco federal court against Bank of America and Chase, as well as credit reporting agencies Experian and Equifax, and they are fighting tooth and nail to avoid taking any responsibility. Some of the defendants, such as Citibank and Experian, have been recently released from the claim due to statute of limitations and other technicalities.
"This underscores how virtually impossible it is to fight these financial institutions who are protected by insufficient and compromised federal legislation", Drew insists.
In 2009, the CA Supreme Court ruled that the federal Fair Credit Reporting Act (FCRA) does not preempt the stronger California Consumer Credit Reporting Agencies Act (CCRAA) statute protecting consumers against false credit reporting. The decision was then solidified in October 2009 when The Federal Ninth Circuit Court of Appeals in California issued a major decision agreeing with the Supreme Court's decision.
Both the Ninth Circuit Court of Appeals and the California Supreme Court ruled that the California Consumer Credit Reporting Agencies Act remedy under California Civil Code 1785.25a are not preempted by the Federal Fair Credit Reporting Act.
The banks now have until February 18, 2010 to file a petition to have the United States Supreme Court review the decision.
For more information please contact Source:
Eric Drew at 408-607-3739 or his attorney John Keating at 650-851-5900
For more information on how to protect your identity see a few earlier blogs. Take control of your identity -before someone else does.
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However, according to federal law as stated in the "Fair Credit Reporting Act", consumers have no right to sue a bank for illegally reporting false information, even when the bank fails to respond to a consumer's demands to change or delete the false information. In short, banks can negligently issue credit to an impostor in your name, report the information on your credit report, then completely ignore your direct demands to remove the false information, all without the threat of lawsuit. Doesn't seem very "fair" does it?
A good example of this is the case of Eric Drew, where banks such as Bank of America and Chase issued credit to a hospital worker who stole Drew's identity while he was fighting a "terminal" leukemia. These banks issued credit to the impostor over the phone without verifying that Drew was actually the applicant. They then ruined Drew's credit score by reporting these fraudulent accounts on Drew's credit for almost two years. Even after Drew miraculously survived by having an experimental non-controversial umbilical cord blood stem cell transplant, he disputed the reporting of these accounts. Still the banks and the credit reporting agencies refused to take the false information off his credit report, causing him to be denied a mortgage. Drew states "This is a direct violation of my most basic rights, and the federal laws which allow this negligent behavior in credit lending and reporting are a disgrace to this country and its citizens".
It's not all bad. California Consumers like Drew finally have some hope. The California Consumer Credit Reporting Agencies Act (CCRAA) does allow consumers to hold banks responsible and sue for knowingly reporting false information. Until recently, banks have successfully used federal preemption precedents to override this more powerful CA law. No longer. Finally, consumers in CA will be able to use the CCRAA to hold banks responsible for the immense damage they are causing by their negligent lending and reporting.
The California Supreme Court and the Federal 9th Circuit Court of appeals have recently ruled to block federal preemption over the stronger CCRAA. As a result of the rulings, consumers in California can now pursue lawsuits under the stronger California statute when banks knowingly report false information. The banking industry, namely Bank of America, has filed voluminous requests seeking to have the courts reconsider their decisions, stating repeatedly that the decision will have "dramatic effects on the rights of consumers". B of A has been given an extended "stay" to decide if they want to appeal the decision to the US Supreme Court, and they are expected to do so. Of course this decision has dramatic effects on the rights of consumers, rights that should have never been taken away in the first place by the FCRA. Banks are obviously concerned that they will now be held accountable by consumers for keeping diligent records and quickly responding to identity theft complaints, which they should have been doing all along.
The financial industry's cries for sympathy are finally falling on deaf ears, both at the White House as well as in the federal courts. This newly invigorated CA law is sure to elicit similar legislation in other states. Let's hope the Supreme Court of the United States does the right thing and denies B of A an audience when they come crying again.
Drew has been fighting a "David vs. Goliath" claim for years in San Francisco federal court against Bank of America and Chase, as well as credit reporting agencies Experian and Equifax, and they are fighting tooth and nail to avoid taking any responsibility. Some of the defendants, such as Citibank and Experian, have been recently released from the claim due to statute of limitations and other technicalities.
"This underscores how virtually impossible it is to fight these financial institutions who are protected by insufficient and compromised federal legislation", Drew insists.
In 2009, the CA Supreme Court ruled that the federal Fair Credit Reporting Act (FCRA) does not preempt the stronger California Consumer Credit Reporting Agencies Act (CCRAA) statute protecting consumers against false credit reporting. The decision was then solidified in October 2009 when The Federal Ninth Circuit Court of Appeals in California issued a major decision agreeing with the Supreme Court's decision.
Both the Ninth Circuit Court of Appeals and the California Supreme Court ruled that the California Consumer Credit Reporting Agencies Act remedy under California Civil Code 1785.25a are not preempted by the Federal Fair Credit Reporting Act.
The banks now have until February 18, 2010 to file a petition to have the United States Supreme Court review the decision.
For more information please contact Source:
Eric Drew at 408-607-3739 or his attorney John Keating at 650-851-5900
For more information on how to protect your identity see a few earlier blogs. Take control of your identity -before someone else does.
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