There are only a limited number of circumstances under which a credit pull (or inquiry) can be conducted under the FCRA. Despite this fact, unfortunately, businesses conduct unauthorized credit inquiries thereby accessing consumer credit reports in violation of the law. This is what is alleged to have occurred by the plaintiff John Pinson. Pinson v. JPMorgan Chase Bank, No. 16-17107 (11th Cir. Nov. 12, 2019).
Mr. Pinson filed a lawsuit against JP Morgan Chase Bank (“JP Morgan”) for having inaccurately reported information on his credit report and for accessing his credit report without a permissible purpose under the FCRA. The district court dismissed his complaint, but the 11th Circuit reversed the district court’s dismissal of Mr. Pinson’s case in part. The 11th Circuit affirmed the dismissal of Mr. Pinson’s Fair Debt Collection Practices Act (“FDCPA”) claim relating to the inaccurately reported credit information but reversed the dismissal of Mr. Pinson’s FCRA claims. The 11th Circuit found, among other things, that JP Morgan having allegedly accessed Mr. Pinson’s credit report through approximately 20 different inquiries – for litigation purposes (as alleged by Mr. Pinson) – would not be one of the permissible purposes to access a consumer’s credit report. Thus, as a matter of law, would constitute a violation of the FCRA. Inherent in its decision is the 11th Circuit’s recognition of the important consumer privacy rights protected by the FCRA.
If you believe inaccurate information is listed on your credit report or you did not provide consent for your consumer credit report to be accessed through a credit inquiry, it is important to seek the guidance of a skilled FCRA and Consumer Protection Attorney as soon as possible. To schedule a consultation to discuss your situation with one of our attorneys, contact The Kim Law Firm, LLC today by calling 855-996-6342.
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Litigation is not a permissible purpose by itself
Companies sometimes pull a consumer report to evaluate a person they are suing or being sued by, on the theory that a legal dispute is business need enough. The statute does not work that way. Permissible purpose is a defined list, and wanting to know whether an opposing party can pay a judgment is not on it. Because large financial institutions have standing access to bureau data through their lending operations, the temptation to use that access for an unrelated purpose is structural rather than occasional.
- Chase — holds bureau access through several lending businesses.
- Wells Fargo — maintains reporting relationships across multiple product lines.
- Bank of America — obtains reports for origination and account review.
- Citibank — pulls across proprietary and co-branded portfolios.
- Barclays Bank Delaware — the issuing entity for several partner programs.
- Portfolio Recovery Associates — a debt buyer with routine access to consumer data.
If you are in a dispute with a company and see a hard or soft inquiry from it around the time of the filing, note the exact date, because the timing relative to the litigation is what makes the inquiry meaningful. Ask the company in writing to state the permissible purpose it relies on. A pull made to assess collectability or to develop leverage in a lawsuit is not authorized, and where the company knew that, the violation is not merely negligent.
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