30 Days? Yah, Right!

Well, as of October 24, 2005, I had been monitoring my credit for over 30 days with no apparent corrections or changes to the Sherman/LVNV account. At this point, I decided to write another dispute to the credit bureau, figuring that my dispute fell on deaf ears.

Up ‘til now I’d been conducting more online research on credit reporting and was armed with a bit more information. I found out that although the Sherman/LVNV account appeared as a duplicate, that it was the WAY that they were reporting that was causing it to appear as a duplicate.

For one, they were reporting a pay history, and reported me 120 days late in March and April of 2003. For another, they were reporting that the account was currently “Open”, and they had reaged the date of last activity to 08/1999, instead of 07/1999. And lastly, they were reporting their account as a “Factoring Company Account”, and a LOAN to boot. Their account was also appearing as an "OTHER" account on my credit report (as opposed to being located in the collections section of my credit report) and the balance was counted against my available credit balance, which was DEFINITELY not right.



So, I figured another dispute to pinpoint specific problems with the account would be in order. I logged online to www.equifax.com and submitted an online dispute. Among my disputes, I included the fact that the account should be reporting as CLOSED, that the date of last activity should be reporting as 7/1999, and that these guy were NOT a factoring company, they were junk debt buyers. I hit the send button on my dispute and wait some more...

Debt Collectors Fight Back Dirty

Okay, I took a while off to spend time with my family over the holidays, but I'm back in full force.

Before I continue with my story, I wanted to let everyone know about a serious miscarriage of justice that an online acquaintance of mine has run into.

Paul has been attacked for years from collectors and has now armed himself with the wits to battle violators of federal and state debt collection laws. His most recent opponent, Accounts Recovery International, has apparently violated debt collection laws on more than a few occasions. After being personally served with his intent to file a lawsuit against them, they decided to retaliate and file harassment charges against him and have him arrested. You can read his story here at http://aribwk.blogspot.com/.

What I want to know is how a consumer who fights back within the boundaries of the law can be construed as a harasser. What message is then sent to consumer who choose to fight back? I'm rooting for you Paul!

What You Talkin' 'Bout Resurgent?

Let's do a bit of backtracking to an earlier post...

Remember the letter from Resurgent? Let me highlight a few important phrases:

"In most cases, creditors charge off accounts once they are 120 days or more past due/delinquent. The statement "120 days past due" is generally how a charged off account is defined by the credit bureaus. Due to the account being charged off, the bureaus still report it as 120 days past due even if it is paid. LVNV Funding, LLC does not report accounts as 120 days past due. This comment is added by the bureaus to further define the account; therefore, LVNV Funding, LLC cannot alter this statement on your credit report."

If you've read anything involving how credit reports are created and maintained, you should be aware that the credit bureau is not responsible for creating the data on a consumer report - it is the responsibility of the data furnisher (debt collector in this case) to report accurate information. It is then up to the credit bureau to pass along the information reported by the debt collector.

The four phrases that were written above are falsehoods, plain and simple, and are designed to cast blame on the credit bureau (in my case, Equifax). Remember how I said that there are laws to protect consumers from the misrepresentations of debt collectors? Well, Resurgent has told not one, but four falsehoods in the same letter, and has committed the first act to earn its place on my lawsuit.

But we can't stop there. The next thing that I received was an "affidavit of debt" from Resurgent, which I have attached below. The letter was dated 10/19/05, but was placed in the mail 5 days later. With the "affidavit" was a cover letter telling me that the account had been placed with Resurgent Capital Services, along with a Privacy Notice on behalf of the "Sherman Companies" (in which they go on to list ALL of the companies affiliated with Sherman).

Notice on the "affidavit", that Ms. Allison B. Moon testifies that the account was originated with OSI/Gulf State? Then she goes on to state that she is competent to testify and that the amount is just and true.

Well, Ms. Allison B. Moon is SO uninformed about this account that she can't even get the originating creditor correct (it was Providian) - then goes on to state that she's competent. What a joke. Anyway, the reason I'm point this out to you is because this is a copy of what's been referred to as a "false affidavit". Regardless of the fact that she lied under oath about the original creditor, Ms. Allison B. Moon has NO FIRST-HAND KNOWLEDGE about this account, so she can't testify to ANYTHING.

This has become a bit unbelievable to me - that a company could get away with outright falsehoods like this. But I remained patient, waiting for Equifax to correct my credit report.

I'm really glad I wasn't holding my breath...

The Fundamentals...

I'm not an expert by any means, but I've had cause to do a lot of research over the past year. I'll try and be concise as possible to conserve space, but will provide links to resources that I've found very valuable...

CREDIT REPORTING

As is commonly known by credit-saavy consumers, there are 3 major consumer credit bureaus: Equifax, Experian and TransUnion. All three bureaus keep a database of information acquired from companies that pay them a membership fee (their subscriber base). These can be companies like your mortgage lender, your credit card issuer, your utility company, or when things get bad financially - debt collectors.

It all starts out when you apply for credit. Most times a lender will want to pull a credit report from one or all three bureaus in order to gauge your "credit-worthiness". This report contains information on what kind of credit has been extended to you, what your payment history is like, how much you currently owe, or where you've been shopping for credit.

For those that have been unfortunate or irresponsible with their finances, it will also contain information on any bankruptcies, debt judgements and collection accounts. A collection account gets reported to a person's credit report after a debt goes into default and gets charged off by the original creditor. An outstanding debt can then either 1) be assigned to an internal collections company or a third-party collections company, or 2) be sold to a debt purchaser that makes a living by collecting on defaulted debt. But bear in mind that a defaulted debt purchaser is STILL a debt collector in the eyes of federal and most state laws (and supported by caselaw) and is subject to following those laws while reporting and collecting debts.

THE FAIR CREDIT REPORTING ACT

When reporting a debt on a consumer's credit report, debt collectors are considered "data furnishers" and must follow the mandates of the Fair Credit Reporting Act. This law regulates exactly how a credit report can be used, what types of information can be reported (and for HOW LONG), as well as stipulates exactly how a data furnisher should handle consumer disputes.

The law provides consumers with a measure of protection against inaccuracies and fraudulent credit reporting, by mandating accuracy in reporting and by giving consumers the right to sue the pants off of companies that violate the law.

THE FAIR DEBT COLLECTIONS PRACTICES ACT

When "collecting" on a debt, debt collectors must follow the mandates of the Fair Debt Collection Practices Act, which sets guidelines on exactly what a debt collector CAN and CAN NOT do while attempting to collect a debt.

Among the many mandates, a debt collector may not do things like: be untruthful with you or misrepresent themselves to you, harrass you, threaten you with actions that they can't legally take, or make inconvenient telephone calls to you at your home or work. It also stipulates that they have to provide you, in a timely fashion, with certain legal notices that inform you of your right to dispute the debt and how to go about doing it.

Here again, the law provides consumers with the right to sue violating companies in federal court.

STATE LAWS

Each state offers its own set of consumer protections that can govern such things as: when a consumer CAN and CAN'T be sued and made to pay an outstanding debt, called the Statute of Limitations; state licensure and bonding regulations; debt collection practices and credit reporting practices.

The list is far too vast to detail, but a great resource to start your research can be found at Lawdog.com.

Now on to the part where I show you how Sherman, LVNV and Resurgent violated these federal and state mandates...

The Subterfuge Starts

After being bombarded by all of the horror stories of fellow consumers' dealings with the debt collection industry, it really didn't surprise me when I received my first letter in response to my complaints - not from Sherman, LVNV or Equifax, but from another company entirely.

The letter was from a Desimber Wattleton with Resurgent Capital Services and read as follows:

"This is a response to your correspondence dated October 14, 2005 regarding the above referenced account. Resurgent Capital Services is now servicing this account for its current owner, LVNV Funding, LLC. By signing a contract with Providian, you agreed to the terms and conditions allowing Providian to report your account history. At some point this account became delinquent and was subsequently charged off and sold to LVNV Funding, LLC (formerly Sherman Acquisition, LP). As current owner of the account, LVNV Funding, LLC has a right to report. This is not a duplicate tradeline or reporting error; this is how credit history is established, maintained, and scored."

"In most cases, creditors charge off accounts once they are 120 days or more past due/delinquent. The statement "120 days past due" is generally how a charged off account is defined by the credit bureaus. Due to the account being charged off, the bureaus still report it as 120 days past due even if it is paid. LVNV Funding, LLC does not report accounts as 120 days past due. This comment is added by the bureaus to further define the account; therefore, LVNV Funding, LLC cannot alter this statement on your credit report."

This is a perfect example of the classic finger-pointing scheme: LVNV points the finger at Equifax and tells me that the credit bureaus are responsible for the reporting. Now to really perfect the scheme, we need the other half - you guessed it - a letter from Equifax blaming LVNV, which we'll get to shortly. But first, let's get a little more in depth on exactly HOW and WHY an account appears on your report...

To be continued...

Dealing with Equifax and Setting the Sherman Family Straight

Upon discovering the Sherman account on my credit report, I immediately wrote a letter to the credit bureau disputing the account. There was NO WAY that I was going to live with come company reporting an open account that was currently in default – I had worked too damn hard over the last few years to pay my bills on time and I was not going to let someone place something negative on my report that was not accurate.

I my dispute letter, I told Equifax that the account appeared to be a duplicate reporting of the original creditor’s account, as Providian (the credit card issuer) was still reporting a charge-off dating back to 1999. I put my letter in an envelope, sealed it, stamped it and placed it in the mailbox. I asked myself, "Now what do I do?"

I’ll tell you what I did…I got on the Internet again and started looking up anything and everything I could find on Sherman Acquisitions and LVNV Funding. I got some fabulous search results and spent hours combing through a wonderful website called ArtofCredit.com. Sadly, AOC.com is no more, but the information contributed by forum members lit a spark of indignation within me. Not only was I able to commiserate with people that were having the same problems, but I also found the answers I needed within their discussions about the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, and the Texas Finance code.

I was immersed in federal law statutes, federal caselaw, news articles about debt collection practices, and scores of consumers just like myself that were trying to figure out exactly WHAT was going on with their credit report. I reached a point where the rumors about Sherman and LVNV prodded me to write another letter telling them EXACTLY what they were reporting incorrectly: an "Open" account, 120+days past due, and the fact that they were classifying themselves as a factoring company. Just in case a newbie is reading this – a factoring company is a company that purchases open accounts receivable from a company at a small discount. This gives the selling company fast cash and the factoring company the right to collect the full balance and make a small profit. The key to the factoring business is that the factor purchases CURRENT accounts with the expectation of getting paid promptly from the invoicee – and that is NOT what Sherman and LVNV did with my account.

My particular account was charged-off in 1999 by Providian and then sold after the charge-off to a debt purchaser called OSI Gulf State for a small fraction of the value. Apparently OSI held onto the account for a few years and then sold it again, to Sherman Acquisitions, who in turn held onto it for a few years themselves. Upon the formation of LVNV Funding (a "Sherman Family Company"), the ownership was transferred to the new entity. These post-charge-off owners are NOT factoring companies (with all of the inherent legal remedies that come with the purchase of a "good" debt) – they are what’s called Junk Debt Buyers, or JDB’s. The fact that they were reporting as a "Factoring Company" on my credit report gave them the appearance of an "innocent" purchaser and creditor, instead of the collection agency that they were.

Add all of this to the fact that they were not reporting at all like the other collection agencies that were appearing on my report, and you can imagine my righteous indignation.

I waited anxiously for a response confirming that they would correct or delete their account on my credit report.

To be continued...

A Dark Day...

Well, it all started out on September 22, 2005, when I pulled up my 3 credit reports from Suze Orman's FICO Kit at http://www.myfico.com/ . Upon reviewing my reports, I knew I was in WAY over my head! There were accounts that I didn't recognize and accounts that I knew were wrong, and personal information that was completely off-track.

The nice thing about Suze's package is that her online software will walk you through disputing any information on your report. Well, needless to say, I had quite a few disputes - one of which happened to be for a company listed on my report as LVNVFUNDG. The funny thing about it was that it appeared under the regular accounts section of my Equifax report (along with all of my currently revolving accounts) as an "Open" account that was 120+ days past due, and NOT in the collection accounts section.

So, I'm thinking to myself....this has got to be wrong (right?)....so I do a little investigation and come up with a sensible answer. This LVNVFUNDG is obviously making some sort of mistake in their reporting. Their reported "Credit Limit" matched a charged-off credit card balance dating back to a card from 1999. However, I never opened an account with LVNVFUNDG directly and the original creditor still appeared on my report. So, I figured they were just reporting the account as a current derogatory by mistake.

I took it upon myself to notify Equifax of their error via a letter [show 9/22 dispute letter] dated the same day, specifically stating that the LVNVFUNDG account must be a duplicate (since the original creditor still appeared). I have 30 days of waiting for my dispute results, so in the meantime I do a little investigating about this account holder and discover their name was really LVNV Funding LLC out of Houston, Texas and they were tied in some way to Sherman Acquisitions, LP. This was confirmed by pulling an online copy of my credit report directly from Equifax's website. This report showed a lot more detail and listed specific contact information for the data furnisher. Funny thing was that LVNV Funding was showing up as the account holder in the Summary [insert pg 3 from 10/13 rpt], but back where the account detail was it showed up as a Sherman Acquisition, LP account.....hmmmmm.

Being the detail-oriented person that I am, I send a letter [show 10/7 letter to Sherman] to Sherman Acquistion dba LVNV Funding (just to cover all the bases) at the Houston, Texas address listed on my report. Within the letter, I dispute the validity of the debt and requested that they either forward validation of the account to my attention, or delete the account off of my credit report. I figure that there's NO WAY this company could be in their right mind by reporting a collection account as something that is currently past due. It's gotta be an error that they will rectify just as soon as I let them know of their mistake. YEAH, RIGHT!

To be continued...

It's a Start

INTRODUCTION:

I'm new to the blogging world but have come across a circumstance in my life that truly merits the dedication of my time and effort to form this blog. Hopefully, this will be a therapeutic exercise that will help me deal with my frustrations (and hopefully my experiences will help other consumers in the future).

For those of you reading that would like to get right to the subject, I'll throw you a bone: This entire blog is about my fight against a conglomerate of debt collectors owned by Sherman Financial - specifically Sherman Acquisitions, LVNV Funding, and Resurgent Capital Services.

But for right now, let me get the thank you's and legal mumbo-jumbo out of the way...

ACKNOWLEDGEMENTS:

First off, I have to give major credit to Christine over at http://www.creditsuit.org/ for publishing such a monumental piece of consumer rights blog. Her dedication to stripping away the sugar-coating on the debt-collection industry lit a similar fire deep within me. Thank you Christine!

Next, I'd like to thank all of the members of my favorite debt collection discussion forums for the knowledge that they have given me to fight these thugs: http://www.infinitecredit.com/, http://www.debtorboards.com/, and http://www.artofcredit.com/ (now defunct). Both have been instrumental in showing me just how WRONG my credit report was.

I'd also like to thank consumer advocate Bud Hibbs at http://www.budhibbs.com/ for standing up for us little guys and giving us the courage to shout "YOU CAN NOT DO THAT!" straight into the faces of our tormentors. And big thank you to the attorneys that run http://www.myfaircredit.com/ and http://www.myfairdebt.com/ for arming all of us consumers with the legal cites to help defeat these guys in a courtroom.

And finally, I’d like to thank pandmel from the old ArtofCredit days, who took the time to walk me through the set up of my own blog – without him this content wouldn’t be here.

Well...enough of the mushy stuff...now onto the legal stuff, which like the removal of a band-aid is best dealt with directly and quickly.

LEGAL DISCLAIMERS:

1. I am in NO WAY affiliated with or endorsed by the Sherman Family of companies, which includes, but is not limited to Sherman Financial, Sherman Acquisitions, LVNV Funding, and Resurgent Capital Services.
2. I am NOT an attorney, and do not claim to give legal advice. Please seek the help of an attorney licensed in your state prior to attempting anything you might read about on my blog.
3. I do not advocate anyone avoiding your debts, as there is both a moral and legal obligation to make good on your promise(s).
4. I am not a Credit Repair service. I do not guarantee that the results that I have attained will match the results of others. I am only laying my experiences out there for others to see and do with as they see fit.

FOR ANY ANTAGONISTS:

You might not like what you read about in my blog, but every single word that I say here is backed up by cold, hard documentation. If there is an error in my posting, please be so kind as to forward written proof of my mistake and I will make no hesitation to change my blog. Be forewarned that baseless threats will not be tolerated and will be vigorously defended.

Also, the use of your copyrighted tradename(s) is a legal right afforded to me under 17 USC 107, so go suck cold turkey!