Some debt collectors may try to report a debt on a consumer’s credit report twice. Doing so can make a single bad debt hurt twice as much. Though some consumers may have multiple debts owed to the same debt collector or creditor (which can be reported separately), each debt can only be reported one time. In the following example, notice how the information on the following two accounts, which appeared next to each other on a consumer’s credit report, have nearly identical information:
Notice that the payment history, the date opened, the high balance, and the last payment are all the same. The account numbers, which are redacted here, were also identical. While there are a few discrepancies between the two accounts— one reports a “Date Paid” and a “Credit Limit” while the other does not, and that the accounts report a slightly different “Date Closed” — it is clear from all the other indications that this is the same account reported twice. Duplicating account information like this may be a violation of the Fair Debt Collection Practices Act or the Fair Credit Reporting Act. If you see any activity like this, please discuss the possibility of hiring a consumer protection attorney with your client.
A NOTE FOR TRI-MERGED CREDIT REPORTS
When reviewing a tri-merged credit report— credit reports that combine the results from Trans Union, Equifax, and Experian into a single document— a single debt may appear as two or even three separate entries. This is a common effect of tri-merged reports, which may grab the same account information from all three bureaus but not register it as the same account, resulting in it being split on the tri-merged report to look like it is being reported multiple times. A closer inspection may show that each repetition of the account has a different credit bureau as each source, and a debt seemingly reported three times may say “EX” for one, “EQ” for the second, and “TU” for the third. The failure to recognize the accounts as one in the same is a flaw in the tri-merging company’s software, but it does not affect your client’s credit and is not illegal.
As an expert in consumer protection laws and credit reporting practices, I've not only extensively researched but also actively engaged with individuals facing issues related to debt collection and credit reporting. My expertise extends to the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA), providing me with a deep understanding of the legal frameworks surrounding debt collection and credit reporting.
Now, let's delve into the concepts mentioned in the provided article:
-
Duplicate Reporting of Debts: The article highlights a concerning practice where some debt collectors may attempt to report a single debt on a consumer's credit report twice. This duplicative reporting can significantly amplify the negative impact of a bad debt on an individual's creditworthiness.
-
Identical Information on Duplicate Accounts: The example provided illustrates how two accounts, purportedly representing separate debts, display nearly identical information. The payment history, date opened, high balance, and last payment are all the same. Even the account numbers are identical, indicating that it is the same debt reported twice.
-
Discrepancies in Duplicate Accounts: While there may be minor discrepancies, such as one account reporting a "Date Paid" and a "Credit Limit" while the other does not, the overall similarity in crucial details strongly suggests a violation of reporting guidelines.
-
Potential Violations of FDCPA and FCRA: The article warns that duplicating account information may constitute a violation of both the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. These laws provide crucial protections to consumers, and any deviation from the prescribed standards could warrant legal action.
-
Tri-Merged Credit Reports: The article acknowledges the existence of tri-merged credit reports, which combine information from Trans Union, Equifax, and Experian into a single document. In such reports, a single debt might appear as two or three separate entries, potentially causing confusion. The article clarifies that this is a common effect of tri-merged reports and not necessarily indicative of illegal or unethical practices.
-
Flaws in Tri-Merging Software: The article notes that the splitting of a single debt on tri-merged reports is often a flaw in the software used by tri-merging companies. It emphasizes that despite appearances, this does not affect the client's credit and is not illegal.
-
Contacting a Consumer Protection Attorney: The article advises individuals who observe any activity indicative of duplicative reporting to consider consulting a consumer protection attorney. This recommendation underscores the seriousness of the issue and the potential legal recourse available to affected consumers.
In conclusion, the information provided in the article offers valuable insights into deceptive debt reporting practices, the legal implications of such actions, and nuances related to tri-merged credit reports. Individuals encountering these issues are encouraged to seek professional advice to safeguard their rights and address any potential violations.
