Bank of America, NA faces a proposed class action wherein a California consumer claims the bank inaccurately determined and reported that he had filed for bankruptcy based on the bankruptcy filing of an individual with a similar name.
The lawsuit alleges the defendant has violated several California state laws, as well as the federal Fair Credit Reporting Act, by not only failing to ensure the credit information it uses and reports is accurate but refusing to correct the inaccurate information when a consumer files a dispute.
“Defendant’s practices harm consumers by prejudicing their prospective Creditors which [sic] inaccurate, adverse information stating that the individual has filed for bankruptcy when they in fact have not,” the complaint states.
Per the suit, Bank of America regularly determines through its standardized internal procedures when an individual account holder has filed for bankruptcy, after which the bank closes the account and reports to consumer credit reporting agencies that the account was included in a bankruptcy.
The case alleges, however, that the defendant frequently “and as a matter of standardized practice” fails to obtain sufficient identifying information about the account holder, leading the bank to inaccurately report to credit agencies that an account has been included in a bankruptcy when it has not.
The plaintiff says he received from Bank of America in January 2020 a letter in which he was advised that the bank had “received notification of a bankruptcy filing by or against [him]” and was suspending access to his account. According to the case, the plaintiff has never filed for bankruptcy.
After contacting the defendant to dispute the determination that he had filed for bankruptcy, the plaintiff learned that because of the bank’s insufficient procedures for identifying account holders, it had erroneously matched him to a bankruptcy filed in Mobile, Alabama by a man with a similar name and a Social Security number that matched the last four digits of the plaintiff’s Social Security number, the lawsuit says.
Per the complaint, the plaintiff has never lived in Alabama, and although his first and last name matched the name in the bankruptcy file, he has a different middle name and consistently uses a generational suffix.
Based on the differences in the two individuals’ personal identifying information, the plaintiff disputed the inaccurate association of the Alabama bankruptcy with his credit accounts, the case says. Nevertheless, Bank of America allegedly reported the bankruptcy to consumer reporting agencies, causing the plaintiff’s credit score to drop.
Even after the plaintiff sent certified letters to Bank of America and the credit reporting agencies and the firms in turn informed the bank of the plaintiff’s dispute, the defendant failed to properly investigate the man’s claim and cease reporting the inaccurate information, the lawsuit alleges.
Moreover, the bank allegedly sent the plaintiff a January 27 letter in which it informed him that it had accurately reported the bankruptcy.
The plaintiff says that although he spoke to Bank of America representatives “many times” in an effort to resolve the dispute and was led to believe the inaccurate reporting had been rectified, the defendant has continued to report the bankruptcy, ultimately leading to the plaintiff’s denial of a personal loan in March 2020.
“BofA repeatedly and continuously acted, and continues to act, in reckless or conscious disregard of Plaintiff’s rights,” the complaint scathes, adding that the bank’s inaccurate reporting has caused the plaintiff to suffer “anguish, embarrassment, anxiety, distress, feelings of hopelessness, and sleepless nights.”
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