A proposed class action lawsuit claims Experian Information Solutions has failed to properly investigate and correct certain credit report information disputed by accountholders, in particular debt information provided by Investigative Recovery Services.
The 19-page case explains that Experian, one of the largest credit reporting agencies in the country, sells consumer reports using data it receives from “furnishers,” such as credit card issuers, auto dealers, lenders and other creditors. Notably, furnishers pay Experian regular fees to report the data included on consumers’ credit reports, the suit says.
According to the complaint, Experian has wrongfully reported that hundreds of consumers owe non-existent or long outdated debts to fraudulent furnisher Investigative Recovery Services LLC. Although numerous consumers have challenged the information, Experian continues to accept the data from Investigative Recovery so it can continue to collect the furnisher’s data reporting fees, the filing contends.
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Per the complaint, Investigative Recovery is a phishing scammer that obtains accurate data about consumers, such as addresses, phone numbers, bank account numbers, and even Social Security numbers, in order to “claim the victim is delinquent in a payday loan and must repay the loan to avoid legal consequences.”
The suit says that until 2022, Investigative Recovery was “somehow” licensed as a consumer collection agency in Florida, despite existing as several short-lived entities since 2011 that reported various principal addresses and repeatedly dissolved after failing to file annual reports. These entities include Investigate Recovery Inc., Investigative-Recovery LLC and Asset Investigative Recovery Inc., the case relays.
Moreover, the suit states that Investigative Recovery holds an “F” rating from the Better Business Bureau, along with eight pages of complaints describing its fraudulent debt collection practice over several years.
“This company has placed a fraudulent payday loan on my Experian credit report,” one review reads. “I have asked for confirmation of the original debt which they can’t provide because it doesn’t exist. They have been calling me nonstop.”
Despite its inability to provide any documentation or proof confirming the accuracy of its false debt reports, Investigative Recovery goes so far as to make harassing phone calls and threaten legal action and even violence toward consumers, the filing alleges.
“Investigative Recovery uses its capacity to report this false data to Experian to maliciously coerce and extort its targets into agreeing to ‘settle’ these fraudulent debts by damaging their credit scores and interfering with their ability to resolve their disputes,” the complaint reads.
The lawsuit charges that Experian continually allows Investigative Recovery to furnish consumer data and consistently marks these debts as accurate, in blatant disregard of consumers’ disputes. The case alleges Experian has violated the Fair Credit Reporting Act by failing to legitimately verify data provided by a furnisher after receiving consumer disputes and failing to maintain reasonable procedures to address fraudulent furnisher activity.
The plaintiff, a New Jersey consumer, claims he received a notification from Experian in November 2021 that a collection was placed on his credit report by Investigative Recovery, causing his credit score to drop 59 points. The filing asserts that the man disputed the information with Experian four times between November 2021 and February 2022 and provided reference to the furnishers’ systematic acts of fraud outlined by the Better Business Bureau, but the agency verified the debt as accurate. He also wrote to and called Investigative Recovery to no avail, the lawsuit says.
Finally, the Investigative Recovery claim was removed from the plaintiff’s credit report in April 2022 after he filed a complaint with the Consumer Financial Protection Bureau and the Federal Trade Commission, the case reports.
The lawsuit seeks to cover anyone whose consumer report was furnished by Experian Information Solutions within the past five years and contained a collections account reported by Investigative Recovery, Investigative Recovery Services, Investigative Recovery Services LLC, Asset Investigative Recovery, Investigative Recovery Inc., or another such name taken by Investigative Recovery.
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