Our office has litigated a number of credit-damage cases in which the client disputed a delinquent account appearing on their credit profile, the derogatory suddenly disappeared for some months, but then started reappearing on their credit report once again without any advance notice. This is known as a “re-insertion violation” of the federal Fair Credit Reporting Act (FCRA).

It may seem mysterious why these re-insertion violations would keep cropping up, but the reason is usually quite simple: When you open an account the “original creditor” assigns it an account number, just as there are account numbers showing on the bills you receive in the mail.  The original creditor may not wish to bother with debt collecting and credit reporting, so it turns the tasks over to a debt collection company. That debt collector, unfortunately, assigns a new account number to the same account and reports it with that new number so anyone viewing it thinks it is a completely different account. Then, let’s say the original creditor is dissatisfied with the first debt collector and so assigns collections and reporting to another debt collector, which in turn gives the same account a still different account number.

Then you have a real mess – the same debt appears multiple times on your credit report, but with different account numbers, thus compounding each time the damage to your credit.

When this scenario is revealed in actual litigation it can be quite interesting. First, the credit reporting agency (CRA) denies it is the same account that is reporting even though everything is the same on the account except the altered account number. Then, when it becomes crystal clear that it is reporting the same debt on your credit report more than once, the CRA will argue that it is not their fault, for how were they supposed to know it was the same account that was derogatorily appearing more than once on your credit report?  How indeed! It was the CRA’s own policies, procedures and lack of oversight that allowed this snafu to happen in the first place.

The FCRA mandates that the CRAs, such as Experian, Equifax and Trans Union, “follow reasonable procedures to assure maximum possible accuracy of the information in the [consumer’s credit] report….” A willful and negligent failure to do so is a serious violation of the FCRA. One wonders then when certain CRA procedures, or lack thereof, assure maximum possible inaccuracy of information in the consumer’s report. Are we to take it that the words of a federal law mean exactly the opposite of what they say? We don’t think so. If you or someone you know has been victimized by the above-described injustice, please contact us as we may be able to help.

By the way, our office has done very, very well litigating reinsertion cases for our clients.

Thanks for reading.

Bob Brennan

Copyright © 2019 by Robert F. Brennan.  All rights reserved.


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