17.3.4 When Dispute Fails to Correct the Credit Report

If the CRA fails to correct the consumer’s report, then the consumer has several ways to respond. The consumer can repeat the dispute process, providing additional explanations or details, and see if that works the second time through. New information should be specifically included and referenced as new because the CRA may refuse to investigate again on the basis that it has already done so. Submitting such additional disputes will always enhance the value of any subsequent litigation and sometimes may actually correct the inaccuracy.

Another option is to bring an FCRA action against the CRA and the furnisher that improperly reinvestigated the dispute. Such litigation is examined in another volume in this series.¹⁰⁹ The FCRA sets a thirty-day to forty-five-day timeframe to resolve a formal dispute. After that, the failure to correct a patent inaccuracy, particularly one that is irrefutably documented by a copy of the court judgment, constitutes a host of FCRA violations by the CRA and furnisher that failed in its reinvestigation. An FCRA action has a two-year statute of limitations and may be brought in state or federal court. The consumer can recover actual damages and attorney fees.¹¹⁰ If the violation is willful, the consumer can also recover statutory and punitive damages.¹¹¹

In addition, if the furnisher is a collection agency or a debt buyer subject to the Fair Debt Collection Practices Act (FDCPA)—and communicates information to the CRA that it knows or should know is false—it may be liable for violating the FDCPA, which can result in an award of up to $1000 in statutory damages, actual damages, and attorney fees.¹¹² This FDCPA violation occurs any time the debt collector/furnisher knowingly communicates false information to a CRA and not just during the FCRA reinvestigation process.