It seems like Wells Fargo just can’t stay out of the news. A class action lawsuit was recently filed in the Eastern District of California, specifically Sacramento, California, alleging that Wells Fargo deliberately failed to update consumer credit reports following a Bankruptcy discharge. This, in essence, defeats the entire purpose of the fresh start of bankruptcy.
As a result of the of Wells Fargo’s actions, many consumers have been denied new credit and may even have problems renting a house or apartment. Failure of a creditor whose debt has been discharged in Bankruptcy to update and report accurate information to the credit bureaus is a direct violation of the Fair Credit Reporting Act (FCRA).
Unfortunately, many consumers pay the problem debt just to clear their credit and move on. The suit alleges that Wells Fargo has an economic incentive to deliberately withhold proper information as many Debtors will feel pressured to just pay the debt.
Wells Fargo is not the only large financial institution to fail to update credit reports following a bankruptcy discharge. Similar complaints have been filed against JPMorgan Chase, Bank of America, Citigroup, GE Capital and Credit One Bank.
It is important to periodically check your credit reports to insure that all information is up to date. It is especially important to check this if you have received a bankruptcy discharge and have been denied credit post discharge. You can get your free credit reports, once yearly by following the instructions here. It is recommended that you get the reports via U.S. Mail as opposed to online for dispute purposes. If there are errors, you can dispute those errors. If you have received a discharge in a Bankruptcy you will dispute a little differently.
Please contact our offices for help if you have credit reporting errors that you would like to dispute and correct.