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Capital One Reason for Cancellation of Credit Card ECOA Class Action

Under the Equal Credit Opportunity Act (ECOA), companies that provide credit are supposed to give customers written notices containing the reasons they’ve taken adverse actions against the customers in a credit transaction. The complaint for this transaction alleges that Capital One Bank (USA), NA did not do this when it closed a customer’s credit card account.

The complaint quotes the findings of an earlier case as saying, “In 1976, Congress amended the ECOA to include a provision requiring creditors to provide applicants with written notice of the specific reasons why an adverse action was taken in regards to their credit.” This was, first of all, to help educate the consumer. Second, if the creditor’s action was based on misinformation or not enough information, to allow for any errors to be corrected.

In this case, plaintiff Jeffrey N. Carr, Sr. applied for a credit card with Capital One. Capital One issued the card, and Carr used it.

On September 1, 2020, Capital One sent Carr a letter saying it was closing his account. The complaint quotes the letter as saying that “Capital One has discovered past or present legal action involving an individual or entity associated with the account. Unfortunately, it can’t be reopened and we are not able to offer additional information about this decision.”

The complaint alleges, “The statement made by Capital One was false.” Carr was not aware of any “past or present legal action” pertaining to anyone connected with the card. Because Carr does not understand what Capital One’s decision was based on, the complaint contends, he cannot correct the information.

When he called Capital One, the complaint says he was told that the bank “had determined that [Carr] was a party to criminal proceedings for sex trafficking and possession of a firearm during the commission of a felony, or similar offenses.” The complaint denies that he has been involved in any such proceedings.

According to the complaint, Carr has searched his credit reports and other sources, trying to find where the information came from, so that he could clear his name, but he has been unable to find any such information. Capital One has not provided the court or case information or the source of its supposed information.

The class for this action is

  • All persons in the US
  • Who applied for a consumer credit card with Capital One,
  • Where the application was denied, or where the account was opened then closed,
  • While the account was not delinquent or in default, and
  • To whom Capital One sent a letter stating “Capital One has discovered past or present legal action involving an individual or entity associated with the account. Unfortunately, it can’t be reopened, and we are not able to offer additional information about this decision.”
Article Type: Lawsuit
Topic: Loans

Most Recent Case Event

Capital One Reason for Cancellation of Credit Card ECOA Complaint

June 3, 2021

Under the Equal Credit Opportunity Act (ECOA), companies that provide credit are supposed to give customers written notices containing the reasons they’ve taken adverse actions against the customers in a credit transaction. The complaint for this transaction alleges that Capital One Bank (USA), NA did not do this when it closed a customer’s credit card account.

Capital One Reason for Cancellation of Credit Card ECOA Complaint

Case Event History

Capital One Reason for Cancellation of Credit Card ECOA Complaint

June 3, 2021

Under the Equal Credit Opportunity Act (ECOA), companies that provide credit are supposed to give customers written notices containing the reasons they’ve taken adverse actions against the customers in a credit transaction. The complaint for this transaction alleges that Capital One Bank (USA), NA did not do this when it closed a customer’s credit card account.

Capital One Reason for Cancellation of Credit Card ECOA Complaint
Tags: Credit Cards, Denial of Loan or Credit, ECOA Violations