First Advantage No Investigation of Disputed Credit Report Entries Class Action

The Fair Credit Reporting Act (FCRA) gives consumers rights when companies compile and trade information about them. For example, in passing the FCRA, Congress said that “the consumer has a right … to correct any erroneous information in his credit file.” In this class action, the complaint alleges that First Advantage Background Services Corp. does not conduct reasonable investigations of information in reports that consumers dispute.

First Advantage is a credit reporting agency, or CRA. The complaint alleges that the law “demands” that CRAs who issue consumer reports “ensure the maximum possible accuracy of the information they report…” Also, it says, if consumers dispute the information in a report and declare it to be erroneous, the law requires “that the CRA conduct a reasonable investigation of the disputed information.” The complaint charges that First Advantage did not do so in the events in this case.

Plaintiff Daniel Gonzales, Jr. was interested in renting an apartment in the Patten East housing complex in Austin, Texas. The landlord therefore submitted a request for a background report to First Advantage.

The report contained information saying that Gonzales had had an eviction proceeding filed against him by PMI Austin. The complaint asserts that this is not true, and that Gonzales “has never been evicted nor had eviction proceedings brought against him.” He therefore contacted First Advantage to dispute this entry.

However, the complaint says, “Rather than conduct an investigation on its own, as the FCRA requires, First Advantage passed the burden of investigation to [Gonzales], demanding that he provide information showing he had not been the subject of an eviction brought by PMI Austin.

Gonzales obtained an e-mailed letter from the owner of the property that had supposedly filed the eviction proceedings. The letter said that Gonzales has not been evicted there or at related properties. However, First Advantage said the information was insufficient for its eviction criteria.

The difficulties proceeded from there, with Gonzales and other parties attempting to provide what First Advantage was asking for, and First Advantage repeating each time that it was not enough and setting forth other (or similar) requirements. The process continued for more than a month. Gonzales lost the apartment he had wanted to rent. In fact, the complaint alleges he had to renew his lease at his current apartment, which he did not want to do.

The complaint alleges that First Advantage did nothing to verify the information Gonzales submitted to them, even though the “FCRA demands that First Advantage investigate disputes.” First Advantage, the complaint says, should have deleted information it could not verify.

The complaint is headed as being a class action complaint, but it does not contain a definition of the class.

Article Type: Lawsuit
Topic: Consumer
Tags: Background Reports, Credit Reports, Erroneous Information on Report, Failure to properly investigate/correct errors on credit report