CFBP Complaint - HSBC/Cap One Update

[funkiehouse]

Hi all,

 

Some of you may have read my other post about this:

 

http://creditboards.com/forums/index.php?showtopic=522542&hl=

 

http://creditboards.com/forums/index.php?showtopic=521029

 

I will post my complaint sent to the CFPB and then the first response I just received today from Cap 1.

 

Let me know your thoughs. I have several but I want to hear what you have to say.

[funkiehouse]

I am writing to express my concern about the legitimacy of two accounts that are being reported on my credit reports by Capital One Bank.

Account **** and ****

I have disputed the accuracy of these accounts online and in writing several times since July 2013. I originally believed that these accounts were being reported and investigated by HSBC only to learn that Capital One was claiming ownership and; according to my Transunion, Equifax and Experian credit reports, were investigating my disputes and claiming to verify the information associated with them. It's my understanding that Capital One purchased, or acquired, HSBC's U.S. credit card business in May 2012, which included all of HSBC's current assets and liabilities at the time of acquisition.

I'm filing this complaint because I am disputing Capital One's right to report, update and verify these accounts because these accounts were never owned by Capital One and could not have been considered an asset or liability of HSBC at the time the acquisition was finalized. Since HSBC sold these accounts to Portfolio Recovery in May 2011, they were no longer the owner of any deficiency or liability that may have occurred prior to that sale and since those accounts had already been sold to Portfolio Recovery, could not have been legally sold again to Capital One by HSBC. In a July 2013 statement from the Office of the Comptroller of the Currency called "Shining a Light on the Consumer Debt Industry" (page 11, Topic I) states: "In a debt sale (i.e. charged-off assets), accounts are sold outright to a third party." If this is a true statement then Capital One has no rights to report or verify a debt that was sold to a third party. 



In my opinion and from what I understand from the FDCPA and FCRA, for Capital One to be able to report these accounts they would either need to be the original creditor of these accounts, have acquired these accounts while current or not yet charged off, or bought them as debt collector. Since Capitol One is not the original creditor, which they cannot be because the debt was sold by HSBC after the accounts were charged off, they should not be allowed to report this negative information on my credit reports.

Precedence for this issue was established in: Kimber Vs. Federal Financial Corporation. A letter drafted by the Federal Trade Commission referencing that case includes a statement that they are in agreement with the court's interpretation that a company that purchases a charged off debt is considered a debt collector. That letter can be found here: http://www.ftc.gov/os/statutes/fdcpa/letters/klayman.htm

If you find that Capital One has the right to report these accounts, then Capital One would be subject to the FDCPA as a debt collector because they purchased charged off debts. Capital One never contacted me by phone or in writing when they claimed to acquire these debts or before reporting it to the credit reporting agencies. The act of reporting these accounts to the credit reporting agencies can be seen as an attempt at collecting a debt, or as a public punishment for what is claimed to be an unpaid debt. Since Capital one would be considered a debt collector in this case, they would have been required under FDCPA 15 USC 1692g(a)3 to send: a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector. Since they never sent me this notice as required by law to allow me to dispute the validity of the debts, I believe they are in violation of the FDCPA for failing to send the required notices for both accounts and for failing to state that they were attempting to collect a debt as required in the FDCPA.

[funkiehouse]

Dear Funkiehouse,

 

The Consumer Financial Protection Bureau has asked that we investigate your concerns regarding the reporting of your accounts.

 

We understand that you would like us to remove these accounts from your credit profile. I have confirmed we are reporting accurate information. In case it’s helpful, I’ve enclosed a copy of our response mailed to you on December 6, 2013, which provides the details of how your accounts are reporting.

 

Capital One purchased a large portfolio of HSBC’s credit card accounts on May 1, 2012. As part of the HSBC portfolio acquisition, Capital One acquired HSBC’s electronic systems of record. These systems describe activity and include data and documentation associated with many accounts (including your accounts), and Capital One agreed with HSBC to respond to inquiries on HSBC’s behalf. Accordingly, Capital One has responded to your ACDV’s on behalf of HSBC, and is not attempting to claim ownership or servicing rights by doing so. We have not changed any of the information HSBC reported on the accounts. Our responses to the ACDV’s are based solely on the information and documentation in the data we purchased.

 

To confirm, your account ending **** was charged-off and sold by HSBC to Portfolio Recoveries Associates on June 21, 2011. Your account ending **** was charged-off and sold by HSBC to Portfolio Recoveries Associates on May 17, 2011. The credit bureau reporting on your accounts in the HSBC tradelines is accurate. Any concerns you have regarding repayment or collections should be directed to Portfolio Recoveries Associates at 1-800-772-1413.

 

****This is the other info from the Dec 6, 13 letter:

 

Account ending in **** charged of due to delinquency on November 30, 2010, and was sold to Portfolio Recovery on May 17, 2011.

 

Account ending in **** charged off due to delinquency on December 31, 2010, and was sold to Portfolio Recovery on June 21, 2011.

 

Along with some other blah blah blah....

[Guest]

Dear Funkiehouse,

 

The Consumer Financial Protection Bureau has asked that we investigate your concerns regarding the reporting of your accounts.

 

We understand that you would like us to remove these accounts from your credit profile. I have confirmed we are reporting accurate information. In case it’s helpful, I’ve enclosed a copy of our response mailed to you on December 6, 2013, which provides the details of how your accounts are reporting.

 

Capital One purchased a large portfolio of HSBC’s credit card accounts on May 1, 2012. As part of the HSBC portfolio acquisition, Capital One acquired HSBC’s electronic systems of record. These systems describe activity and include data and documentation associated with many accounts (including your accounts), and Capital One agreed with HSBC to respond to inquiries on HSBC’s behalf. Accordingly, Capital One has responded to your ACDV’s on behalf of HSBC, and is not attempting to claim ownership or servicing rights by doing so. We have not changed any of the information HSBC reported on the accounts. Our responses to the ACDV’s are based solely on the information and documentation in the data we purchased.

 

To confirm, your account ending **** was charged-off and sold by HSBC to Portfolio Recoveries Associates on June 21, 2011. Your account ending **** was charged-off and sold by HSBC to Portfolio Recoveries Associates on May 17, 2011. The credit bureau reporting on your accounts in the HSBC tradelines is accurate. Any concerns you have regarding repayment or collections should be directed to Portfolio Recoveries Associates at 1-800-772-1413.

 

****This is the other info from the Dec 6, 13 letter:

 

Account ending in **** charged of due to delinquency on November 30, 2010, and was sold to Portfolio Recovery on May 17, 2011.

 

Account ending in **** charged off due to delinquency on December 31, 2010, and was sold to Portfolio Recovery on June 21, 2011.

 

Along with some other blah blah blah....

 

Yes, I have experienced the CFPB basically saying "Yeah, it is correct" as well.

 

Very Experian-like when they do this sometimes.

[funkiehouse]

Just to be clear this response was from Capital One through the CFPB. I don't know if it necessarily means they agree with it or not but I'm not sure. My other CFPB complaint got results the first time so I didn't ned to respond other than to say I agree with the outcome.

[NewbietoFinance]

Did you dispute their response?

[funkiehouse]

I like how they didn't touch on the fact that they are subject to the FDCPA. Also in their response they stated that they purchased HSBC's portfolio and records in May 1, 2012 and that they have not changed any of the information that is reporting. I will post this as soon as I can scan it, but I have a credit reports (from the same CRA) from 9/19/12 and 11/7/13, which both have very different information and dates on them. So either they are lying or the CRA decided to take it upon themselves to change the reporting.

[funkiehouse]

Did you dispute their response?

 

Not yet. I'm double and triple checking everything before I do. I think I will post my follow-up here before sending it off.

[funkiehouse]

Sorry for the photos. Scanner not playing nice. This is the 9/19/12 report.

 

[funkiehouse]

This is the 11/7/13 report. Looks like things changed to me.

 

[funkiehouse]

I also found some old TU reports that show the trade line company on my reports changed from HSBC to Cap One and then back to HSBC. All of which was after the buyout. So their claim that they never changed anything is BS. It's not that what they said in the CFPB was illegal but it was nice to catch them in a lie, unless the CRA made it up but thats a different story.

[funkiehouse]

ulfvjhv

[FreeaAndClear]

This looks like it's now a positive trade line, right?

[funkiehouse]

This looks like it's now a positive trade line, right?

 

Half and half and only on this CRA. It looks like it but it still shows it was purchased by another lender. It could mean HSBC and not Portfolio. Either way it's reporting incorrectly between this CRA and the other. They said in their response that they never changed anything. Not illegal to say but looks like a lie in the CFPB.

[funkiehouse]

Here's my response draft:

 

Dear Crap,

 

I do not feel that your response has begun to answer the questions or concerns stated in my original complaint. In your response you stated: “Capital One purchased a large portfolio of HSBC’s credit card accounts on May 1, 2012.” You also stated that this included my accounts. Purchasing charged-off debt records is something debt collectors do. I understand that Capital One may not be accustomed to being considered a debt collector; however, as I mentioned before precedence for this issue was established in Kimber Vs. Federal Financial Corporation. When a company purchases a debt that has already been charged-off, the company purchasing that charged-off debt then becomes a debt collector. As required by the FDCPA, I was not given proper notice of your attempt to collect a debt, and since you continued reporting these tradelines on my credit reports, that constitutes violations of the FDCPA and the FCRA.

 

Also in your response, you stated that Capital One “is not attempting to claim ownership or servicing rights.” I have copies of my Transunion credit reports that can show where the company name listed for these accounts was changed from HSBC to Capital One and then changed back to HSBC at a later date. In my eyes that clearly shows an attempt at ownership. Yourself and the 3 credit reporting agencies have stated in writing that the information being reported on my credit reports is being reported correctly.

 

In your response to this complaint you also stated: “We have not changed any of the information HSBC reported on the accounts.” As you mentioned, Capital One bought HSBCs credit card portfolio on May 1, 2012. I have attached copies of these accounts, which came from the same credit reporting agency, one dated 9/19/12 and the other dated 11/7/13. As you can clearly see the information on these two reports do not look the same at all. Since you stated the information is being reported correctly and that Capital One has never changed the reporting of the information, one of those two statements, if not both, are incorrect. Since these changes occurred after the purchase of these accounts it had to have been Capital One that changed the reporting of the information. If my credit report from 9/19/12 was reporting correctly, then what’s being currently reported is inaccurate. If the information that was being reported on my 9/19/12 report was incorrect then you were in violation of the FCRA for reporting incorrect information because Capital One would have been responsible for the reporting of that information after May 1, 2012. If you believe the credit reporting agency changed this information without Capital One’s involvement then please make that known, as that is also a violation of my rights. I do not believe that’s the case since I received correspondence in the mail from Capital One regarding my disputes, which I attached to my original complaint. As soon as you sort out who is in violation of my rights, please let me know.

 

Love, Me

[shifter]

I would break up those huge paragraphs into smaller, more manageable chunks to make it easier for the person on the other end to follow.

 

I would also reiterate a demand for your end goal (deletion of the account) at the bottom of the letter.

[funkiehouse]

I would break up those huge paragraphs into smaller, more manageable chunks to make it easier for the person on the other end to follow.

 

I would also reiterate a demand for your end goal (deletion of the account) at the bottom of the letter.

 

Sounds wise. Thanks

[FreeaAndClear]

You noticed that it says it is scheduled to stay on your report till 2021, right? That's why I think it is positive so you might be better off leaving it alone.

 

I don't think it matters if it says it was transferred to another lender. I've got a million of those on very good student loan tradlelines.

[funkiehouse]

Thanks Freedom.

 

Its still listed under negative accounts. The same accounts are reporting as COs on the other reports so having it gone means way more to me than having a half a$$ looking positive account with one CRA. Having them say my current reports have been verified with the CRA's showing different things is exactly what I wanted. I haven't exactly stated that yet in this complaint because I'm saving that for round 3, if needed. How can they be reporting accurately if they are different.. I'm not concerned about credits scores. The negative TL's mean more to me. Catching them in a lie in a CFPB made it all worth it, even if nothing gets deleted. My whole argument could be complete crap legally but at least its on CFPBs radar and I don't think its crap or I wouldn't have given it a try. I'm just hoping that they make an even bigger mistake as we move along.

Edited January 17, 2014 by funkiehouse

[funkiehouse]

So the other two complaints I have done with CFPB were resolved on the first try so I'm looking some knowledge from others that replied/disputed the companies response. It said that they are starting an investigation and that they rarely contact you for follow-up or with results. They said if you don't hear from them in 60 days it has been closed. So would you sit around and wait for something that might not come or would you do a FTC dispute and a BBB to keep things going?

[Jaboon]

I feel your pain crap one needs to go bankrupt for their non-workin with ppl. Cant stand them! They have zero good-will. Good luck and hopefully you can drill them!

[funkiehouse]

I feel your pain crap one needs to go bankrupt for their non-workin with ppl. Cant stand them! They have zero good-will. Good luck and hopefully you can drill them!

 

Ha!! Thanks!

[nativetexan]

funkiehouse how did your cfpb investigation end ??

[funkiehouse]

Hi nativetx,

 

Not much happened. I never heard anything back from the CFPB, which is common. I'm going to shoot off a BBB just for giggles.