TransUnion Denied Judgment in Identity Theft Case: What It Means for ID Theft Victims

Summary

A recent court decision has reinforced protections for identity theft victims under the Fair Credit Reporting Act (FCRA). Lesley Kaplan sued TransUnion after it refused to block fraudulent credit card charges from her credit report, despite her providing the required documentation. TransUnion’s arguments for dismissing Kaplan’s claims were rejected by the court, allowing her case to proceed. This ruling underscores the responsibilities of credit reporting agencies to address identity theft under the federal Fair Credit Reporting Act (FCRA). 

Background: Identity Theft and Credit Reporting

Lesley Kaplan, a California resident, discovered fraudulent charges on her Wells Fargo credit card in April 2023, including a $900 Target purchase. Acting swiftly, she filed police and FTC reports and requested TransUnion to remove the fraudulent charge from her credit report. Kaplan provided detailed documentation, including identity verification and reports proving the theft of her identity.

TransUnion, however, denied her request, citing statutory exceptions under the FCRA, including potential misrepresentation or possession of goods from the transaction. Despite Kaplan’s efforts, TransUnion’s investigation upheld the charge as legitimate.

Kaplan sued TransUnion, alleging violations of Section 605B of the FCRA, which mandates credit reporting agencies to block information stemming from identity theft if consumers provide proper documentation. TransUnion argued that Kaplan’s request didn’t qualify under the law and was technically infeasible. The court rejected TransUnion’s arguments. 

Key Legal Issues and Analysis

1. Scope of Section 605B 15 USC § 1681c-2

TransUnion claimed that Section 605B only applies to fraudulent accounts opened under false identities—not specific charges. The court rejected this, stating that the statute’s language applies broadly to “any information” stemming from identity theft. Kaplan’s case, involving a fraudulent charge on an existing account, falls squarely under this provision.

2. Feasibility of Compliance with the FCRA

Trans Union argued that removing specific charges from Kaplan’s credit report was technically impossible without extensive account monitoring and calculations. The court dismissed this defense, emphasizing that CRAs must comply with the statute by blocking disputed information, regardless of logistical challenges. Kaplan’s allegations that TransUnion deliberately refused to act were taken as valid at this procedural stage.

Implications for Identity Theft Victims

This case highlights critical protections under the FCRA for consumers who fall victim to identity theft. Here is a short list of identity theft victims’ rights and remedies under the FCRA: 

• Right to Block Fraudulent Information: Section 605B, 15 USC § 1681c-2 ensures that consumers can request the credit bureaus to block credit report entries linked to identity theft. Agencies must act within four business days if valid documentation is provided.
• Credit Bureau Accountability: Credit reporting agencies cannot evade FCRA compliance by claiming logistical or technical hurdles. They are required to implement reasonable processes and procedures to protect consumers, especially victims of identity theft.
• Legal Recourse for Non-Compliance: Victims like Kaplan can pursue legal action if a credit reporting agency fails to fulfill their obligations under the FCRA. The court’s rejection of Trans Union’s defenses sets a strong precedent.

What This Means for ID Theft Victims

If you’re a victim of identity theft, you have rights under the FCRA to ensure that fraudulent information doesn’t damage your credit:

• Document Everything: File police and FTC reports immediately and keep copies. Report the fraud to the Federal Trade Commission. 
• Submit a Formal Dispute to the Credit Bureaus:  Mail the credit reporting agencies a dispute letter by certified mail with all required documentation, including identity verification and details of the fraudulent activity.
• Know Your Rights: Credit bureaus must block fraudulent information within four days unless they prove your claim is invalid.
• Seek Legal Help:  If a credit reporting agencies refuses to act, consult an experienced FCRA attorney experienced in consumer protection laws. Our firm has represented hundreds of identity theft victims in federal court across the U.S.

Need Help Fighting Credit Report Errors?  

If identity theft has impacted your credit, our experienced team is here to help. We focus on holding the credit bureaus CRAs accountable under the FCRA to identity theft victims and protecting your financial future. If you have errors on your credit report due to identity theft, our Fair Credit Reporting Act attorneys can help victims clear their name. The Adkins Firm counsels identity theft victims on the road to recovery. 

Has your identity been stolen?  Do you have fraudulent information on your credit reports due to fraud?  Have you disputed the fraudulent information to the credit bureaus and the credit reporting agencies verified the fraudulent information is accurate? If you answered yes, then you may have claims under the Fair Credit Reporting Act (FCRA). 

Contact us today or chat with us live to let us know how you have been harmed as a victim of identity theft. Our FCRA lawyers may be able to help you clear your name, too. We do not charge a fee unless our client receives a monetary recovery from the defendant. 

Remember, it’s your credit report!