Lawsuit Investigation: State Farm Bank Applies for Loans, Pulls Reports without Permission
Last Updated on November 27, 2019
Investigation Complete
Attorneys working with ClassAction.org have finished their investigation into this matter.
Check back for any potential updates and take a look at our open investigations here. The information on this page is for reference only.
Case Update
- November 26, 2019 – Investigation Closed
- Thank you to everyone who contacted us in regard to the State Farm Bank investigation. At this time, attorneys working with ClassAction.org have decided not to pursue this matter. To view our open list of investigations, please visit this page. If you still have questions about your rights in regard to the issue discussed on this page, please contact an attorney in your area. The information below was posted when this investigation began and is for reference only.
At A Glance
- This Alert Affects:
- Customers of State Farm Bank.
- What’s Going On?
- State Farm Bank has come under fire for illegally pulling credit reports on consumers and reporting inaccurate information – both of which have the potential to damage a person’s credit. Now, a class action lawsuit could be started.
- How Do You Know All This?
- In late 2018, the Consumer Financial Protection Bureau released the findings of its investigation into State Farm Bank and found that the bank had repeatedly violated federal law regarding consumer reports.
- How Can a Class Action Lawsuit Help?
- A successful case can provide remedy to people whose credit scores were harmed because of State Farm Bank’s illegal credit reporting practices.
If you opened a State Farm Bank credit card or refinanced a car loan through the bank, attorneys working with ClassAction.org would like to speak with you.
It’s possible that the bank pulled your credit report without any good reason, reported and/or refused to correct inaccurate information about you, or even opened a credit card in your name without you knowing about it. Read on for more.
What’s Going On?
In late 2018, the Consumer Financial Protection Bureau (CFPB) announced that it had concluded its investigation into the credit reporting activities of State Farm Bank and found the company engaged in a number of illegal practices, detailed below, that have the potential to adversely affect a person’s credit score.
Pulling credit reports without permission or reason for doing so
According to the CFPB, State Farm Bank ran consumer reports on people without any permissible reason for doing so. In some cases, the bank initiated credit applications for the wrong people by incorrectly entering customer information or selecting the wrong person from a list of consumers in its application system. As a result, the bank obtained consumer reports and generated credit inquiries for the wrong people – likely without them ever knowing.
Further, it was discovered that State Farm Bank even initiated vehicle loan applications for people who never applied for a loan – all “for the purpose of soliciting these customers.” When this happened, a credit inquiry was triggered for that individual.
Reporting Inaccurate Credit Information
The CFPB also found that State Farm Bank was furnishing inaccurate information to consumer reporting agencies, which may include Experian, Equifax and TransUnion.
The bank has been accused of:
- Furnishing account information for the wrong person
- Reporting current accounts as delinquent
- Reporting inaccurate payment histories and past-due amounts
State Farm Bank reported this inaccurate information despite having – and knowing that it had – the correct information in its own credit applications, loan files, or “payment system-of-records,” the CFPB said.
Failing to Correct Errors, Notify of Disputes
State Farm Bank has also been accused of failing to notify agencies when a consumer disputed a piece of information in his or her credit report and dragging its feet when it comes to correcting credit reporting errors. It reportedly took State Farm Bank “months” to correct inaccuracies in consumers’ credit reports, even when people made repeated requests to have the errors fixed.
How Do I Know If This Happened to Me?
Your best bet is to look at your credit report. It may show a hard inquiry, loan or credit card from State Farm Bank – and you may not notice this unless you go looking for it. Attorneys working with ClassAction.org are also willing to take a look at your credit report to determine whether you were affected by State Farm’s illegal activity.
How Can a Class Action Lawsuit Help?
While you may have heard that State Farm Bank settled the claims against it, keep in mind that this settlement pertains only to the CFPB investigation – and not to any class action lawsuit. The CFPB settlement offers no compensation or remedy for people who had their credit scores impacted or who were otherwise affected by State Farm Bank’s practices. This recourse will need to be sought through a class action lawsuit – but attorneys need your help before they can get one on file.
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