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Unauthorized Credit Pull


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Consumer consent to having such a report pulled (even in the context of a credit application) is not discussed in the FCRA (except where it comes to a report provided to a consumer themself that is to be sent by mail).
 
Permissible purpose is the sole threshold that must be net.  I'm not saying that there isn't room to dispute such permissible purpose exists within your deposit transaction.  However, my guess is that you'd need to retain someone with considerable motivation to fight on your behalf (maybe [mention=136067]PotO[/mention] might offer himself at a reasonable fee).
 
Your call here.  In my personal life, I put up with much greater nuisances without engaging them, deeming such potential  fight to be of greater bother.

I would only recommend the lawyer that was once recommended to me here on CB.

As for permissible purpose, I don't think it's as simple as just going to a dealer and test driving a car. What you quoted could apply to someone going into Walmart and looking for a large-screen plasma TV.

In my last duty station we had several car dealers outside the base that would try that stunt. You'd go in, look at a car, test drive it and then the next thing you know there were INQ galore on your credit reports. They are now bankrupt.

The base CG first just banned all personnel from even stepping foot on the car dealers' property. Then the lawyers set in. And the CFPB. The CFPB stuck a richard so far up their arse that it came out their nose.

For them to have permissible purpose, you have to give them permission. Many of their sales agreements will state you allow them to pull your credit reports. If you tell them you are looking for financing with them it gives them permission.

My bet is that OP gave them that deposit and signed an agreement. Or that they told the dealer they wanted financing.


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any idea on getting them removed? I hate how they're treating this...no one had my permission and I want them gone.

Look for "Agruss Law Firm" on Facebook. You can get their contact details there for Mike.

This is the lawyer that was recommended to me here on CB previously and they were great.

To this date I don't know why or how, but a few years ago I had a series of debt collectors trying to pin a debt on me that is 35 years old than I am. Mike took it and sued each one and won. He sued one who just sent me a simple letter, but didn't have the required legal disclosures on the letter.

He helped people in my unit sue legitimate debt collectors who tried an end run around contacting employers.

He sued three car dealers who pulled credit without permissible purpose.

While I have only had positive experiences with Mike, YMMV. If he cannot help you, he will educate you as to why.


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2 hours ago, PotO said:

For them to have permissible purpose, you have to give them permission. Many of their sales agreements will state you allow them to pull your credit reports. If you tell them you are looking for financing with them it gives them permission.

 

Not sure where you come up with that.  My reading of the relevant FCRA language is that it's the nature of the transaction that gives rise to "permissible purpose" (where "permission" is referring to the specific reasons reports can be legitimately pulled detailed in the FCRA).

 

I don't see any language that says the consumer must consent to a creditor pull.

 

If someone unwittingly gives a garage permission to pull in the course of getting an oil change, I don't read that this gives the garage "permissible purpose" to pull. 

 

If you put a refundable purchase deposit down on a car, requesting it to be held for 2 weeks while you consider your options and line up financing, I see the possibility that this gives the dealer sufficient interest in the health of your finances (do you actually have the financial flexibility to purchase?) before committing to hold the car, that this might create "permissible purpose".  If so, I see no requirement for the consumer to have to consent to a pull.

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Not sure where you come up with that.  My reading of the relevant FCRA language is that it's the nature of the transaction that gives rise to "permissible purpose" (where "permission" is referring to the specific reasons reports can be legitimately pulled detailed in the FCRA).
 
I don't see any language that says the consumer must consent to a creditor pull.
 
If someone unwittingly gives a garage permission to pull in the course of getting an oil change, I don't read that this gives the garage "permissible purpose" to pull. 
 
If you put a refundable purchase deposit down on a car, requesting it to be held for 2 weeks while you consider your options and line up financing, I see the possibility that this gives the dealer sufficient interest in the health of your finances (do you actually have the financial flexibility to purchase?) before committing to hold the car, that this might create "permissible purpose".  If so, I see no requirement for the consumer to have to consent to a pull.

Common sense.

Are you seriously going to tel us that when you put a large screen plasma TV on lay-a-way at Walmart they can pull your credit? Or if you just go in and talk to them and take a test view of their TV on display that they can pull your credit? That's absurd.

What you state about the oil change makes no sense at all. If you give them permission they can pull. Always. Otherwise, by your logic, they can pull your credit to make sure you are inclined to pay them after they perform the service.

For a car dealer to pull your credit, you need to either give them express permission or ask them to help you find financing. Otherwise, there's no reason for them to pull. When you give them a deposit on a vehicle, they are going to have you sign an agreement anyhow. Only a moron would give a car dealer any deposit without a real guarantee that they are going to hold a specific car. Every single agreement I have ever seen talks about credit pulls.

Even when you apply for a credit card, you do not have to give permission, according to what the FCRA states. Even so, I have never -- yes, never -- seen any credit application that did not have fine print which states "you are authorizing us to pull your credit." I dare you to show me an online app that doesn't have that verbiage.

Then there is the pesky little issue of three large car dealers in Oceanside, California that went bankrupt because the CFPB and other FCRA lawsuits so deeply FITA the dealers over inquiries.

Sometimes it seems that common sense isn't very common.


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1 hour ago, PotO said:

Common sense.

 

I get everything you cite here.  But the fact is that the FCRA language governing "permissible purpose" doesn't cite a need for consumer consent.  (I welcome a citation to language that suggests otherwise.)

 

In the context of "permissible purpose", the language clearly was written with an intended lack of specificity.  Consumer lawsuits alleging non-permitted pulls have been dismissed out of a broad interpretation of that language.  But the case files exist that document permissible purpose as extending beyond purely lending transactions.

 

I agree with you that the consistency with which credit apps implicitly have you acknowledge permission to pull a report would give credence to the idea that such permission is required.  If so, I don't know from where such a requirement stems (not the FCRA).  But it's possible that the broad language in FCRA defining "permissible purpose" was considered so imprecise that creditors found it prudent, as a rule, to have applicants acknowledge permission just to fend off the possibility of a dispute over the vague FCRA definition down the road.  (pure speculation)

 

I do find it conceivable that, as a hypothetical retailer, if I'm going to set aside pricey merchandise for you under the assurance that you're very likely to purchase it prior to a set date, potentially declining other sale opportunities in the interim, that I would have a genuine need to ascertain that you're generally of means to complete the purchase.  (Where ample inventories are at hand, this burden isn't met.)  This need conceivably could satisfy the vague definition of "permissible purpose" in the FCRA,

 

I'm not putting any money on the line on that one.  But if you read other instances where the courts have found "permissible purpose", this one doesn't run far afield.

 

Big caveat;  Every assertion here is grounded in my post-doctorate experience in "Google Search".  I've carefully annotated my findings on a series of candy bar wrappers.  Nonetheless, I'll stick to my assertions until something concrete to the contrary has been cited :)

 

 

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I get everything you cite here.  But the fact is that the FCRA language governing "permissible purpose" doesn't cite a need for consumer consent.  (I welcome a citation to language that suggests otherwise.)
 
In the context of "permissible purpose", the language clearly was written with an intended lack of specificity.  Consumer lawsuits alleging non-permitted pulls have been dismissed out of a broad interpretation of that language.  But the case files exist that document permissible purpose as extending beyond purely lending transactions.
 
I agree with you that the consistency with which credit apps implicitly have you acknowledge permission to pull a report would give credence to the idea that such permission is required.  If so, I don't know from where such a requirement stems (not the FCRA).  But it's possible that the broad language in FCRA defining "permissible purpose" was considered so imprecise that creditors found it prudent, as a rule, to have applicants acknowledge permission just to fend off the possibility of a dispute over the vague FCRA definition down the road.  (pure speculation)
 
I do find it conceivable that, as a hypothetical retailer, if I'm going to set aside pricey merchandise for you under the assurance that you're very likely to purchase it prior to a set date, potentially declining other sale opportunities in the interim, that I would have a genuine need to ascertain that you're generally of means to complete the purchase.  (Where ample inventories are at hand, this burden isn't met.)  This need conceivably could satisfy the vague definition of "permissible purpose" in the FCRA,
 
I'm not putting any money on the line on that one.  But if you read other instances where the courts have found "permissible purpose", this one doesn't run far afield.
 
Big caveat;  Every assertion here is grounded in my post-doctorate experience in "Google Search".  I've carefully annotated my findings on a series of candy bar wrappers.  Nonetheless, I'll stick to my assertions until something concrete to the contrary has been cited
 
 

Bull .

Walmart cannot run your credit report if you put a large screen TV on lay-a-way. But the wording in the FCRA suggests they can.

Even more bull when you talk about lawsuits being dismissed. Three large car dealers in Oceanside, California had the bejesus sued out of them precisely for pulling credit reports unnecessarily. The CFPB clobbered them, too. They were not your typical used car dealers. One was Toyota, one Ford and the other Subaru. All dead.

I actually was one of several who went to the Toyota dealer when many of my colleagues started talking about this. Just talking to the salesman and taking a test drive, they placed seven INQs on my credit reports. Mike Agruss got me $7,000 for that.

The FCRA for credit applications is in no way imprecise. (a)(3)(A) is exceptionally far from being imprecise. Yet every time you apply for credit online you have a very prominent and explicit warning that they will pull your credit.

Your hypothetical situation of setting aside merchandise for sale at a later date is double bull . Walmart doesn't run your credit when you put an expensive item on lay-a-way.

If you go into a car dealer, do not tell them your already have solid financing in place and sign their sales agreement, they can pull your credit. Every sales agreement I have seen gives permissible purpose to pull your credit unless you specifically tell them not to. Also, if you are paying by check -- as most credit unions give you the loan via a check payable to the dealer -- they can pull your credit unless you don't take possession of the car until the check clears in several days.

But if you go in, take a test drive, don't ask them for credit or sign any type of sales agreement, if they pull your credit you win an easy $1,000 per INQ.



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Big caveat;  Every assertion here is grounded in my post-doctorate experience in "Google Search".  I've carefully annotated my findings on a series of candy bar wrappers.  Nonetheless, I'll stick to my assertions until something concrete to the contrary has been cited
 
 


Your Google skills suck. Get a refund of your tuition.

Here's what the FTC says:

“The dealer would thus have a permissible purpose to obtain a credit report on a consumer who offers to pay for an automobile with a personal check or asks about credit options to finance a specific purchase. However, this section would not allow the salesperson to obtain a report on “window shoppers” for bargaining purposes, deciding whether to spend time with consumers, or to respond to general questions about available products or financing, because there is no “transaction … initiated by the consumer” in those scenarios. For the same reason, a consumer’s request to “test drive” a vehicle, where he or she has not demonstrated an intent to initiate the purchase or lease of a vehicle, does not give rise to a permissible purpose under this section.”

Here's what a reputable attorney states:

https://www.paulmankin.com/is-it-illegal-for-a-car-dealership-to-run-credit-without-your-permission


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I have a guaranteed money making opportunity for everybody here on CB.

 

I will finance my son's $48k annual tuition for the next several years as well as sweetheart payments to [mention=767]Hegemony[/mention]'s Bavarian tart by visiting [mention=31973]HDPorter[/mention]'s and [mention=9352]Pandmel[/mention]'s car dealerships and get them to run my credit without permissible purpose.

 

At $1,000 a pop, I figure it will only take me about one car dealer per week and that's only if the car dealer pulls just one bureau.

 

Y'all should go out and get in on the free cash. I expect a 10% kickback which will go to my favorite charity -- Toys for Tots.

 

Hell, this could easily turn into a mega-high income, tax-free full-time job.

 

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21 hours ago, PotO said:

 


Here's what the FTC says:

“The dealer would thus have a permissible purpose to obtain a credit report on a consumer who offers to pay for an automobile with a personal check or asks about credit options to finance a specific purchase. However, this section would not allow the salesperson to obtain a report on “window shoppers” for bargaining purposes, deciding whether to spend time with consumers, or to respond to general questions about available products or financing, because there is no “transaction … initiated by the consumer” in those scenarios. For the same reason, a consumer’s request to “test drive” a vehicle, where he or she has not demonstrated an intent to initiate the purchase or lease of a vehicle, does not give rise to a permissible purpose under this section.”


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That's the type of authoritative interpretation of the loosely worded FCRA guidance that I invite and welcome in response to my assertions.  Please provide a source link.

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That's the type of authoritative interpretation of the loosely worded FCRA guidance that I invite and welcome in response to my assertions.  Please provide a source link.

What happened to the post-doc in Google Search?


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19 minutes ago, PotO said:

Good find. This makes more sense to me.

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https://www.ftc.gov/news-events/press-releases/1998/02/ftc-staff-advises-automobile-dealers-may-not-obtain-credit

 

The staff of the Federal Trade Commission today advised automobile dealers that access to consumer credit reports is strictly limited under federal law. Responding to reports and consumer complaints that automobile dealers have accessed credit reports while consumers are "window shopping" at a showroom or are out for a test drive, the staff issued an opinion letter which provides guidance to automobile dealers concerning the circumstances in which they may obtain credit reports on consumers who are shopping for vehicles. The letter to the Texas Automobile Dealers Association, signed by David Medine, Associate Director for Credit Practices, cautioned that credit reports may not be obtained until the consumer does more than window shop or take a car out for a test drive.

 

According to the staff, improper access to credit reports can: result in an invasion of the privacy of consumers' confidential financial information; provide dealers an improper negotiating advantage over consumers because they will be aware of the consumers' financial condition; and, hinder consumers' ability to obtain credit in the future because inquiries will appear on consumers' credit reports, although recent changes in some credit scoring models will mitigate this potential harm.

 

The Fair Credit Reporting Act (FCRA), which is enforced by the Commission and the states, regulates the use of credit reports and other types of consumer reports. It does not allow an automobile dealer to obtain a credit report on a person who "comes to an automobile dealership and requests information" from the dealership. The FCRA, which was recently amended by Congress, generally limits the circumstances in which businesses may obtain credit reports when considering applications for credit, insurance, or employment or those situations where consumers "initiate" a business transaction for personal, family, or household purposes -- such as the lease or purchase of a family vehicle -- and the business has a "legitimate need for the information." Under the amended FCRA, automobile dealers or others who improperly obtain credit reports can be subject to civil penalties of up to $2,500 per violation.

 

The staff's letter includes the following specific guidance as to the use of credit reports by automobile dealers:

 

A request to "test drive" a vehicle does not indicate an intent to purchase a vehicle and, therefore, does not "initiate" a business transaction. A dealer must obtain written permission if the dealer wants to check a consumer's credit report before or during a test drive.

 

Obtaining credit reports solely for the purpose of negotiating with consumers is not permitted.

 

The fact that a consumer asks questions about prices and financing does not necessarily indicate an intent to purchase or lease a vehicle from the dealer. The consumer may only be "window shopping" or comparison shopping. Thus, the dealer must obtain the consumer's written permission before obtaining the credit report if the consumer has simply asked questions about prices and financing.

 

If a dealer needs to see a consumer's credit report before answering general questions, such as inquiries about available financing when the consumer has not applied for credit, the dealer must obtain written permission from the consumer.

 

In responding to the Texas Automobile Dealers Association's general question as to when a business transaction initiated by the consumer begins and a dealer may obtain a credit report, the staff letter states, "[A]n automobile dealer may obtain a report only in those circumstances in which the consumer clearly understands that he or she is initiating the purchase or lease of a vehicle and the seller has a legitimate business need for the consumer report to complete the transaction." The staff's letter emphasizes that, even when the consumer is purchasing or leasing a vehicle, the dealer has a right to obtain a credit report on the consumer only when it has a legitimate need for the information, such as if the consumer requests financing (to review creditworthiness and prior payment history), or a dealer may have a right to access a consumer report to see if the consumer has a history of passing bad checks after a check is presented but before the consumer takes possession of the vehicle.

 

-----

 

So, we can all go to Walmart and put that large screen plasma TV on lay-a-way without any worries that they will place ten inquiries on your credit reports.

 

 

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19 hours ago, PotO said:

"[A]n automobile dealer may obtain a report only in those circumstances in which the consumer clearly understands that he or she is initiating the purchase or lease of a vehicle and the seller has a legitimate business need for the consumer report to complete the transaction." The staff's letter emphasizes that, even when the consumer is purchasing or leasing a vehicle, the dealer has a right to obtain a credit report on the consumer only when it has a legitimate need for the information, such as if the consumer requests financing (to review creditworthiness and prior payment history), or a dealer may have a right to access a consumer report to see if the consumer has a history of passing bad checks after a check is presented but before the consumer takes possession of the vehicle.

 

 

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Which would clearly be indicated by putting down a deposit on a car and what ever else transpired with the OP.

"I want that car, here is some money to take it off the market." Would be a clear transaction initiated by the consumer and give permissible purpose.

The opinion letter does not state that a signature is required in those respects. 

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20 hours ago, PotO said:

Of course, it was just common sense to begin with. Just like I stated.

 

 

Can't speak to your experience, but in mine the intersection between the law and "common sense" is particularly thin at times.

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Which would clearly be indicated by putting down a deposit on a car and what ever else transpired with the OP.

 

"I want that car, here is some money to take it off the market." Would be a clear transaction initiated by the consumer and give permissible purpose.

 

The opinion letter does not state that a signature is required in those respects. 

You might want to ask your Literacy Volunteer for extra help, Jethro.

 

There has to be more than just a transaction initiated by the consumer. There has to be a legitimate need for the information. I really don't know how much further I can dumb this down for you.

 

"The staff's letter emphasizes that, even when the consumer is purchasing or leasing a vehicle, the dealer has a right to obtain a credit report on the consumer only when it has a legitimate need for the information, such as if the consumer requests financing ... "

 

I realize you are a bit thick, so I'll fall back on this hopefully idiot-proof analogy:

 

If you go into Walmart and give them $500 to put a large flat-screen plasma screen TV on lay-a-way, they do not have permissible purpose to place an INQ on your credit reports.

 

If they said they wanted the car, gave them $500 to hold it -- notice that for a very good reason I am going to capitalize this next word -- AND inquiries about financing, pulling their credit is appropriate. If they put down a deposit AND stated they'd be back in with a check to pay the remainder, a credit pull is appropriate.

 

Otherwise, you are delusional.

 

 

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Can't speak to your experience, but in mine the intersection between the law and "common sense" is particularly thin at times.

At times perhaps, but not this time.


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On 2/4/2022 at 7:53 AM, PotO said:

You might want to ask your Literacy Volunteer for extra help, Jethro.

 

There has to be more than just a transaction initiated by the consumer. There has to be a legitimate need for the information. I really don't know how much further I can dumb this down for you.

 

"The staff's letter emphasizes that, even when the consumer is purchasing or leasing a vehicle, the dealer has a right to obtain a credit report on the consumer only when it has a legitimate need for the information, such as if the consumer requests financing ... "

 

I realize you are a bit thick, so I'll fall back on this hopefully idiot-proof analogy:

 

If you go into Walmart and give them $500 to put a large flat-screen plasma screen TV on lay-a-way, they do not have permissible purpose to place an INQ on your credit reports.

 

If they said they wanted the car, gave them $500 to hold it -- notice that for a very good reason I am going to capitalize this next word -- AND inquiries about financing, pulling their credit is appropriate. If they put down a deposit AND stated they'd be back in with a check to pay the remainder, a credit pull is appropriate.

 

Otherwise, you are delusional.

 

 

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You ignorant wannabe Celestial being...

We do not know the full story from the OP,

I would lay 10/1 they discussed the dealer arranging financing. How much do you want to lose? 

I know you have a super desire to be correct all the time. YOU ARE WRONG HERE. 
 

 

 

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You ignorant wannabe Celestial being...

We do not know the full story from the OP,

I would lay 10/1 they discussed the dealer arranging financing. How much do you want to lose? 

I know you have a super desire to be correct all the time. YOU ARE WRONG HERE. 
 
 
 

Jethro, ask your psychiatrist to help you sharpen up on those ESP skills.

You have no idea at all what they discussed with the dealer, but in any event your literacy volunteer can help you understand what the FTC clearly stated. Haven't you learned, reading is a valuable skill? Go finish third grade, Jethro, so you can catch up.

This has been stated countless time, Jethro -- unless the individual has asked the dealer to arrange financing, trying to pay with a check or otherwise were notified by the dealer that they would pull their credit, there is no permissible purpose.

Seriously, Jethro, just because you have the IQ of a dyslexic gerbil doesn't mean all hope is lost. Religiously take all those meds your psychiatrist prescribes.


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