'Truth in Credit Act' targets false credit info
March 5, 2003
Legislation would force creditors to correct inaccuracies or face legal damages
Inman News Features
Assemblymember Christine Kehoe (D-San Diego) has introduced legislation seeking to force creditors and credit-collection companies to correct inaccurate information or face statutory damages, the California Association of Realtors said today.
Dubbed the "Truth in Credit Act," AB 800 aims to change the standard for creditors who furnish information to credit-reporting agencies.
Current state law prohibits creditors from reporting adverse credit data to the credit-reporting agencies if the creditor knows—or should know—that the information is inaccurate or incomplete.
The legislation, cosponsored by C.A.R. and the Consumers Union, would increase the obligation of creditors to give only accurate information by permitting creditors to furnish information about a consumer to a credit-reporting agency only if the creditor has reason to believe that the information is accurate and complete.
Current state law only requires the creditor to complete an investigation about disputed information and report it to the credit-reporting agency within 30 days upon receipt of the notice of dispute. AB 800 provides that the creditor must review the information, correct any inaccurate information and report to the credit-reporting agency the results of the investigation and any corrected information.
The legislation would also make it a violation of law for the creditor to confirm inaccurate information after the investigation.
Copyright: Inman News Service