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Equifax Sued Over Inaccurate Public Records Data in Credit Reports

Equifax Sued Over Inaccurate Public Records Data in Credit Reports

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Equifax Information Services, LLC Subject of Class Action Alleging Equifax Does Not Follow Reasonable Procedures to Ensure the Timely Gathering and Reporting of Updated Public Record Information, Such as the Release, Satisfaction or Removal of Tax Liens or Judgments, in Consumer Reports 

On May 14, 2018, Kehoe Law Firm, P.C. and co-counsel filed a class action lawsuit in Philadelphia County Court of Common Pleas, Trial Division, against Equifax seeking, among other things, statutory and punitive damages, for Equifax’s alleged violations of the Fair Credit Reporting Act (“FCRA”), as a result of Equifax’s reckless disregard for consumer’s rights by failing to adopt reasonable procedures to timely gather and report updated public record information reflecting the disposition, or satisfaction, of such things as tax liens and judgments.  As a result of its conduct, the complaint alleges that the Pennsylvania-based Plaintiff and putative class members suffered reputational harm, reduced credit scores, and an increased risk of being denied credit.

Equifax’s Failure to Timely Gather Updated Information Regarding Derogatory Information in Credit Reports

According to the complaint:

Equifax is a consumer reporting agency that compiles and maintains files on consumers on a nationwide basis. As part of this process, Equifax uses an automated and systematic procedure to gather and report derogatory public records in credit reports, such as tax liens and judgments. However, Equifax does not follow similar procedures to gather updated information about when the tax lien or judgment is released, satisfied, vacated or otherwise removed. Equifax’s failure to timely gather updated information is a violation of 15 U.S.C. § 1681e(b) because Equifax has not implemented reasonable procedures to ensure the maximum possible accuracy in the preparation of the consumer reports that it furnished regarding Plaintiff and the putative class members. (Emphasis added)

Despite no affirmative requirement in the FCRA, Equifax proactively seeks out and purchases public records data, including Pennsylvania tax liens and civil judgments, to include in the credit reports it sells.  Equifax, however, “does not follow reasonable procedures to gather information when the tax liens or judgments are released, satisfied, vacated, appealed, or similarly dismissed, with the same rigor and process that it employs to gather information initially.”

Allegedly, the third-party vendor Equifax engages to collect judgment and tax lien information “was only obligated to collect and provide updates and dispositions if the vendor determined it was ‘commercially reasonable’ to do so.”  Further, according to the complaint:

As a matter of common policy, Equifax and its vendors rarely collect any tax lien or judgment disposition information.

In short, Equifax published public records data that it knew would be inaccurate if a release, satisfaction, dismissal, vacatur or appeal had occurred—relying on consumers to clean up their own files via the dispute process after learning of the inaccuracy, rather than paying to have these dispositions collected with the same vigor that it collected records of the initial entry of judgment. (Emphasis added)

The Pennsylvania Plaintiff’s Equifax Experience

On or about January 4, 2013, a Pennsylvania state tax lien was filed against the Plaintiff.  In March 2016, the Plaintiff sent payment in full to the Pennsylvania Department of Revenue, and the lien was satisfied in March 2016.  In August 2016, a copy of the lien release was filed.  In February 2017, a copy of the Plaintiff’s Equifax report was pulled by Quicken Loans.  The Equifax report incorrectly reflected that the Plaintiff’s lien was unpaid and not satisfied.

Despite the fact that the tax lien was satisfied and reflected as such on Pennsylvania public records, Equifax did not remove the tax lien public record from the Plaintiff’s credit report or update the credit report to show the lien as satisfied, released or paid.  If the company followed the FCRA, which requires a consumer reporting agency to follow reasonable procedures “to assure maximum possible accuracy of the information concerning the individual about whom the report relates,” Equifax would have conducted a simple, free online public records search and reported an update to the public record reflecting that the Plaintiff’s lien was satisfied.

Consumers: Does Your Consumer Report Contain a Tax Lien or Other Civil Judgment Error?

If your consumer report from Experian, TransUnion or Equifax reflects a satisfied tax lien or other civil judgment as unpaid, not satisfied or not released, please contact Kehoe Law Firm, P.C. by completing the form above on the right, sending an e-mail to [email protected] or by contacting Michael Yarnoff, Esq., (215) 792-6676, Ext. 804, [email protected], to discuss your potential legal rights.

Kehoe Law Firm, P.C.