FCRA and FDCPA: Answering Your Questions

FCRA and FDCPA: Answering Your Questions


For those who don’t know me, my name is John Watts, I’m a consumer protection attorney.

Feel free to subscribe to my YouTube channel, Alabama Consumer Protection Lawyers, and feel free to ask questions or send me your comments.

Today, I’ll be answering some questions from the comments section on some of my YouTube videos.


Ernie asks, “How can I dispute to a credit company reporting a charge off but another credit company removing the same charge off?”

I’m assuming when Ernie says “credit company,” he’s referring to Equifax, Experian, or TransUnion.

If you have a Capital One charge off, and you’ve disputed it, and TransUnion keeps it but Equifax deletes it.

How is that possible?


There are a couple of possibilities:

  1. Capital One may have told different stories to the two credit
  2. It could be that maybe Equifax got your dispute, passed it on to Capital One, and Capital One decided to keep it, but TransUnion or Experian got it, and they don’t even pass it along to Capital One, they just delete it.

It could be helpful to have it deleted, so you may want to dispute it again and point out to whichever company is still keeping it, “The other credit bureau took it off. Here’s a copy of the results of the investigation, showing that they deleted it. Why aren’t you deleting this?”

They’re not required to, but that could be helpful to them.


Jordan says, “If someone went into collections weeks before July 1, 2022, will they still get the one year before it gets reported to credit reports?”

This question is referring to a video I did about some changes coming to medical debt collection.

So, the idea is that nothing will go on your credit report before at least a year has gone by.

To answer your question specifically, Jordan, I’m not sure exactly how that will play out.

We just recently got a press release from the bureaus, but there are a lot of details.

Some have argued about the meaning of certain wording in the changes to the law.

For example, it says paid medical collection will be deleted. Well, what does “paid” mean?

I take “paid” to mean if they say I owe $500, whether I pay them $500 or $50 or

$5 or 5 cents, if they accept it, and say “We’re done,” then I consider that to be paid.

Some people say, “No, that would be settled for less than the full amount, and that is not considered paid.”

So, there are a lot of details we just don’t know yet, but as time goes on, we’ll gain insight.

The CDIA, which is the industry company that puts out what you may be familiar with as the Metro 2 guide, will release the details and give us some information at least about what the industry is saying that they’re willing to do.


Evie says, “We paid Finger Hut in full after it went to collection. Then Finger Hut put it back on there as a bad debt, and then “paid,” and refused to take it off. Does the FCRA apply here?”

It certainly can. You want to dispute that through the credit bureaus. So, let me make sure I understand this question.

You paid Finger Hut. My first question is, “Did you pay them directly, or did you pay them through a collector?”

In a sense, it doesn’t matter because if you paid them, then there’s nothing more that’s owed.

But sometimes that can help us understand what’s happened here. And then Finger Hut put it back on your credit report as unpaid.

Let’s say it was $500, and you paid them $300, and Finger Hut has put it back on your credit report either as owing $500 or owing $200?

The $500 minus the $300 you paid, and now they say you owe $200?

That would all be wrong if you settled it where you owed nothing on it. It would not be accurate or complete for them to say that it’s unpaid.

Since you said they refused to take it off, it sounds like you may have reached out directly to Finger Hut, which makes sense, but unfortunately, under the Fair Credit Reporting Act, we need to go directly to the bureaus.

So, the first step is to dispute it with Equifax, Experian, TransUnion, maybe Innovis if they’re on there.

Show the credit bureaus what happened because whatever we show them, they are supposed to pass it along to Finger Hut.

Show them the settlement letter from Finger Hut or the collector. Here’s the check that I sent them.

Here’s where they wrote me back and said that I’ve completely paid off this account, or whatever information you can give them would be very helpful.

After you send in that dispute, if it’s not removed, then you may have an FCRA case against the bureaus: Equifax, Experian, TransUnion, and maybe Innovis.

But you would definitely have a case against Finger Hut if Finger Hut is reporting this false information and they’ve had a chance to fix it by you disputing it through the credit bureaus.


K. Young says, “Refiling dispute letters for disputes I originally filed over the phone. This really helps.”

That’s good.

So, I’ll tell you this: we haven’t utilized this much in the past, but we’re recommending to our clients to contact the credit bureaus by phone.


Here’s the sequence we go in:

  • Have them dispute it
  • They get their results back
  • They can call and ask why it wasn’t fixed or deleted, and that will be considered a dispute

Usually, that doesn’t take the full 30 days, and then they’ll mail you the results or they’ll put it inside a portal if you have a transunion.com or Experian.com, myequifax.com account.

So, certainly nothing wrong with doing it over the phone.

I just can’t tell you what to do because you’re not my client. I can’t give you advice.

But for my clients, when they call, if the credit bureaus say, “Please be advised. All calls may be recorded for quality purposes,” then they can record those calls, and that can be very helpful because sometimes those representatives will be extremely honest when the credit bureaus don’t want them to be.

They’ll say, “Look, we don’t do any investigation. We just send this off to Capital One or Midland Funding, or Finger Hut, or whoever it may be. We just do whatever they tell us.”

Well, we all know that’s true, but they’re not supposed to say that out loud. But if you record them saying that? That’s very, very valuable.

So, I certainly think it’s a good idea to at least consider doing phone disputes. It’s not necessary, but whether it’s by phone, online, by letter, that’s all you need.

That second dispute by phone seems to add a personal touch to it, so I think it’s an interesting strategy to use.


Brandon asks, “Should we include our report with circled corrections in our dispute letters to the bureaus, or just describe what is wrong in writing?”

That’s a fantastic question, Brandon.

Here’s my answer: I would do both. In your letter itself, I would describe what’s wrong. “You’re missing the data for these months.”

You say, “Here’s the date of my last payment,” but the amount on my report shows zero. Yet I paid $200 that month, or whatever the payment was.

I would say, describe it in words, but then, it’s also a good idea to pull out those pages of the credit reports and include them with your dispute letter.

You may want to circle anything incomplete or inaccurate and highlight it.

You can do this physically with a pen or highlighter, or you can pull it up on an iPad in Adobe or another pdf reader and highlight or circle with a stylus or your finger to circle what’s missing or inaccurate.

This process makes it clear. You’re telling them and showing them.

The written letter should be very descriptive, but when we literally give them a picture, that’s even more helpful.

Some people edit part of the report and drop it into the body of the letter.

This calls attention to their errors so they can’t say they didn’t know what was disputed.


In the video, “What is a refusal to pay letter?” Blazer asks, “Are you telling me I can rack up a huge debt with someone, send them a refusal to pay letter and be completely off the hook? That sounds sketchy.”

Yeah, it does sound sketchy, and no, that’s not what I’m saying.

What I’m saying is, with a debt collector, you have the right under federal law, under the Fair Debt Collection Practices Act to say to the collector, “I want you to cease all communications with me,” and then they have to stop communicating with you.


It doesn’t make the debt go away.

They can sue you, and they can put it on your credit report, but they can’t call you or write you.

Or you can write to them and say, “I refuse to pay this.” It’s the same thing.

A refusal to pay or cease communication letter only tells the collector that they cannot continue to communicate with this consumer, but they can sue them if they have a legal right to sue.

They can put it on your credit report if they have a legal right to put it on your credit report. So, it does not make the debt go away.


It just means they stop blowing up your phone.

That’s been the law since 1977 with the Fair Debt Collections Practices Act. So, this is not some novel concept or anything like that.

If you want to look it up yourself, go to 15usc section 1692c (c), and that will be the “cease communications” or the “refuse to pay” section. Check it out. You can see what it says.

Again, it does not make the debt go away, but it means that the debt collector has to leave you alone.

They can send it back to the creditor who can send it to another collector, or sometimes they will forward it to another collector themselves.

So, you still may have to deal with collectors. You just won’t have to deal with

this collector writing you or calling you.


Mz Dee is asking about a 7th circuit case.

Even though this is a little bit outside of what we do, I thought I would go through the recent Supreme Court decisions (US Supreme Court decisions) because I think it’s interesting to know how they think and how they apply the law.

Certainly, that affects us in consumer law. What the Supreme Court does affects our lives in a lot of ways, and it’s good to know how they come to their decisions.


Mz Dee says, “You missed a lot of steps. Was on the right path by challenging, did not do it right.”

When you read court opinions, sometimes you see that some really important facts have been left out.

Sometimes it’s frustrating when you’re in a case, and you know all of the facts, and the court accidentally leaves things out.

I don’t know exactly what happened, but I know from reading the court opinion that it sounds like there were some mistakes made by the consumer, or there may not have been.

Also, the 7th circuit is just a challenging place for consumer cases, and I think that would have had a different result in most other places.

So, you have to know where you’re fighting your battles and how the court applies the law. You have to be careful about that.


LaQuanda says, “Are the ACDV, AUD, frozen scans, carbon copies, all different items?”

There’s a lot of different terminology when we’re talking about credit reports. So, people will throw out these terms, such as E-Oscar, ACDVs, AUDs, etc.

I think I have a video where I go through what E-Oscar is and what the automated dispute verification system is and how all of that works.

But for our purposes, understand what the law requires:

  • When we dispute to a credit bureau anything that’s inaccurate or incomplete or that can’t be verified,
  • That credit bureau has to either fix that item or delete it
  • Usually, to do that they have to send it to the furnisher – the company that provided or furnished the information
  • Then that company has to investigate
  • So, the furnisher has to investigate, and the credit bureau has to investigate
  • When that is done correctly, your credit report will be accurate and complete

When they don’t do it correctly, it’s very likely that negligence was involved on the part of the credit bureau, the furnisher or both, and you may be able to pursue a lawsuit there.

Nery asks regarding the arbitration video, “I’m talking about being sued by a debt collector. Can you help me with filing this?”

If you’re in Alabama or TN, we can help you with this. If you are in another state, then you need a lawyer who is licensed in your state.

The basic concept of this is: if you want to compel arbitration, that could be great, or it could be a terrible decision.

You have to know what’s the best thing to do in your particular case.

As soon as you get the case, let the court know that you are demanding arbitration because if you wait too long, you’ll be considered to have waived your right to arbitration.

Let the other side know that you are demanding arbitration. I want you, the plaintiff, the one who filed the lawsuit, to go file an arbitration claim.

Sometimes they try to flip that around on you and say, “No, you have to file it.” And I’ll say this: sometimes that’s to your advantage.

You may have a choice of where to go. If they try to bluff you and say, “You have to go file this!” Well, pick the best place for you.

It may be worth paying $150 or $200 to do that.

This is called a motion to compel arbitration that you file in court, and again, that’s going to vary by state.


Sumter says, “What if the debt collector sends you a purchase agreement from the original creditor and a couple of statements along with your court summons, but the current debt collector’s name is not on any of those pages/paper?”

Here’s one way to think about it: This concept is sometimes called the Chain of Titles.

You start with the original creditor, and then you’ve got the company that sued you.

Let’s say that this is LVNV Funding.


Well, do we have a purchase agreement from the original creditor to LVNV Funding? Almost certainly no.

Some companies do, but not LVNV Funding. It will likely go to Sherman Acquisitions next, then to another one, and then to Resurgent, and then it may go to LVNV.

So, you want to be able to see the purchase agreements for each step of the way.

What they’ll say is, “Oh well, once it went to Sherman Acquisitions and then it went to Resurgent, then to LVNV, we don’t have any paperwork.”

Really? These are separate corporations, and we don’t have any paperwork? We’re transferring hundreds of millions of dollars in debt, and we don’t have any paperwork? That’s very odd.

So, the truth of the matter is, there’s paperwork, but they don’t want you to see it. That’s a different matter.

Maybe I’m entitled to see it. Maybe I’m not.

But to go back to your original question, I would ask,

“We’ve got the original creditor. How did it get to debt collector 2? Debt collector 1 must’ve sold it to debt collector 2, or maybe to someone in between, and this is debt collector 3. Where are those purchase agreements, where are those witnesses?” Hopefully that is of some help to you.


Meandering Missionary says, “Do you think if I had never put it with my bank or any credit reporting agency that I’m a disabled veteran, is it legal for them to put that on my credit report? Isn’t that a HIPAA violation? Is it something I can sue them for?”

I don’t think it would be a HIPAA violation, and I don’t think you can sue for that, but there are many things on our credit report that we may not have ever told anybody, but if the credit bureaus find out, they may be allowed to report that.

For example, I may have a cell phone that no one has the number to.

If the credit bureaus get a hold of that number, they can put it on your credit report.

Now, I can dispute it and say I want that taken off, but they may or may not remove it.

So, if you don’t want that status of disabled veteran, you might dispute it with the credit bureaus and see if they will take it off.

I would just explain why you want that off. Because of privacy, or is there some issue?

Maybe you’re facing discrimination when you are applying for a loan when they see that.

Whatever the reason is, I would give that to the credit bureaus, but just remember that everything with the credit bureaus has to be accurate and complete.

If it’s true that I am a disabled veteran, and that’s on the credit report, well, is that accurate? Is it complete?

So, I don’t know that you could ever sue for that, but you may be able to explain to the credit bureaus why this is a problem and have them take that off.


What if you are mentally incompetent, such as legally disabled by SSA (Social Security Administration) and receive SSDI?

This is in the context of being sued by LVNV, so typically, legally disabled is going to be different than mentally incompetent.

Let me say it this way: I can be disabled because of a back injury or a disease and still be very mentally sharp.

So, I can be disabled without being mentally incompetent.

Or I could be mentally incompetent – it could be that I was born that way, it could be a stroke, or it could be a head injury.

Now, with SSDI, that’s where we pay money into the system, so this would probably not be something that we were born with, but it might be an injury or disease that has affected our mind, and that may qualify as being disabled and being incompetent.

If you are deemed mentally incompetent, the VA will appoint someone to receive the money for you.

I believe they call them a fiduciary. So, I’m not sure if you have that designation.

As far as being sued, if someone is incompetent, typically the court is notified that this person is mentally incompetent, and the case may be dismissed, or someone may be appointed to stand in the place of that person who has been sued.

Not necessarily a lawyer, but just someone who can stand in their place.

So, I would find out if you’re talking about a lawsuit filed by a debt collector like LVNV.

I would see if the court or any government agency has declared the person who is being sued to be mentally incompetent.

If you share that information with the collection lawyer, they may back off.


Case Dismissed With Prejudice or Without Prejudice?

Usually, they would dismiss the case without prejudice. When we say prejudice, normally that’s a bad thing, right?

Here, prejudice has nothing to do with race or anything like that.

It has to do with, “Can they sue you again?”

So, without prejudice? Yes, they can sue you again. With prejudice, they cannot sue you again.

Typically, if a debt collector or collection lawyer sees that somebody is mentally incompetent, or if they’re 87 years old with terminal cancer, they’ll just dismiss it without prejudice.

That way, they could sue again if they needed to, but at least the guys that I deal with by and large would not be trying to get a judgment against somebody who is mentally incompetent.


Always feel free to call us at 205-879-2447 or fill out our contact form.


John Watts

Leave a Comment