The Court of Appeals for the Seventh Circuit upheld a lower court decision yesterday, which granted summary judgment in favor of a debt buyer who inadvertently transposed numbers in an individual’s account number when sending a collection letter and subsequently reporting the unpaid debt to two credit bureaus.
A copy of the ruling, in the case of Walton v. EOS CCA, can be accessed here.
The plaintiff received a collection letter from the defendant, identifying her account number as 119864170. A subsequent collection letter sent by the defendant identified the account number as 864119170, having transposed the first three and second three digits in the original account number. The plaintiff then disputed the debt, acknowledging that her name and phone number were correct, but lied that the last four digits of her Social Security number matched what the defendant had in its system. The plaintiff disputed the debt again, saying she did not owe anything based on the account number provided, which had the transposed numbers. EOS investigated the dispute, and verified the name, address, and last four digits of the Social Security number based on the information provided by the original creditor.
The defendant reported the debt to two credit bureaus, noting the account was disputed. The plaintiff wrote to the credit bureaus, and after the second letter, the defendant asked the bureaus to delete the record from her account. She then filed suit, alleging violations of the Fair Credit Reporting Act and the Fair Debt Collection Practices Act.
The court ruled against the plaintiff on both counts. In talking about the FDCPA:
It is both sensible and consistent with that purpose to construe § 1692g(b) as requiring a debt collector to verify that its letters to the consumer accurately convey the information received from the creditor. The verification assures the consumer that the creditor actually made the demand the debt collector said it did and equips the consumer to evaluate the validity of the creditor’s claim. It would be both burdensome and significantly beyond the Act’s purpose to interpret § 1692g(b) as requiring a debt collector to undertake an investigation into whether the creditor is actually entitled to the money it seeks. Section 1692g(b) serves as a check on the debt-collection agency, not the creditor. We thus join other circuits in holding that the statute requires “nothing more than the debt collector confirming in writing that the amount being demanded is what the creditor is claiming is owed.”
With respect to the FCRA violation, here is what the Appeals Court said:
EOS’s investigation was unquestionably reasonable. When EOS first heard from the credit-reporting agency, the report stated solely that Walton claimed the account did not belong to her. Based on this scant report, EOS conducted a reasonable investigation by verifying Walton’s personal information with her EOS file on record. After receiving the second credit-reporting agency notice, EOS learned that Walton challenged the accuracy of the account number associated with the debt. EOS responded to this information by asking the credit agencies to delete the adverse credit report. And they did. Nothing more was required of EOS.
