California Credit Law Blog

Identity thieves steal identities by retrieving credit card offers from trash cans and the filling sending them in using their own addresses. Law professor Jeff Sovern reports that
he told his class the Fair Credit Reporting Act requires the credit card issuers to allow consumers to opt out of the applications (15 U.S.C. § 1681b(e)), thus reducing the likelihood that an identity thief will steal their identity.

But most people don't opt out and instead tear up the applications and his students brought up a MSNBC story about how a consumer tore an application up, then taped it back together, and sent it in using a different address. Chase sent him the credit card anyway.

Prof Sovern recommends that consumers should opt-out of credit card solicitations. For the FTC's advice on how to do so, go here.

SmartMoney reports there are now seven different credit scores for sale available on more than 20 websites inevitably leading to confusion among consumers. Experian, Trans Union, and Equifax each sell their own credit scores. The FICO traditional score is the one used by the great majority of lenders.

A class action recently filed in a federal court in San Diego alleges that Experian's subsidiary Consumerinfo.com that operates www.freecreditscore.com is deceiving customers in selling Experina's PLUS credit score. The lawsuit alleges the score is not one typically used by lenders.

Read more: Which Credit Score is Best? - SmartMoney.com http://www.smartmoney.com/personal-finance/debt/which-credit-score-is-best-1302212043057/#ixzz1JEVwu8Eh

With exceptions, the Fair Credit Reporting Act requires credit reporting agencies to limit access to consumers credit files to persons with whom the consumer has a credit relationship. A credit relationship is one in which the consumer and a creditor agreed the consumer could defer payment. Persons who do not have a credit relationship with the consumer have no right to look at the consumer's credit files.

If a person's car is towed and stored off the street without his or her consent, the tow company will typically give the owner a notice to pay the tow and storage bills. If the owner does not pay the charges, the tow company sells the car in a lien sale. After the sale, the tow company is often owed some hundreds to thousands of dollars. The tow company then turns the debt over to a collection agency that specializes in attempting to collect tow bills.

The question is whether a debt collector attempting to collect such debts has a right to access the owner's credit files. In a case handled by Andrew Ogilvie of this office, in 2007 the 9th Circuit Court of Appeals ruled that debt collectors attempting to collect debts arising from involuntary towing and storage of vehicles may not access Experian's files on the owner.

In spite of the court's ruling, we allege in a new class action that Experian has continued to allow debt collectors seeking to collect on tow bills to access vehicle owners' credit files. The case is Holman v Experian, No. CV-11-000180-JF and is pending in the Northern District of California.