
Talia of on June 29, 2010
Summary: LHR holds a charged off debt from HSBC. LHR is reporting the wrong date of last delinquency. LHR is claiming that they only report to one credit bureau which is Experian and that Experian must have sold my information about this trade line to the other credit bureaus. But when disputed with other credit bureau LHR verified the information. LHR is reporting themselves as a FACTORING COMPANY instead of a collection company. They claim they can because of the CDIA manual. The debt is for a charged off credit card which according to ucc article 9 collection accounts and credit card debt is excluded from being factored. LHR is reporting all three of my credit reports as an open installment account which is past due and interest is being added.
My First BBB LHR Letter. "I am writing to inform LHR that you are reporting several pieces of erroneous and ILLEGAL information on my credit reports in COMPLETE violation of FCRA and FDCPA legislation. According to my credit reports your company started to report in 2009, LHR, Inc is listed as a Factoring Company. That I have an Installment account, with 1 Month Terms with an Open status with your company. Everyone knows that LHR is not a Factoring Company. You can't be a Factoring Company because LHR purchased debts that are already in default and charged off.
"So far these are the many violations that I have found that your company has violated. Please note that by verifying this information to the credit reporting agencies you have basically stated that everything you reported you knowing voided the following: 1.LHR violated 15 USC 1692e(2)(A) by falsely characterizing the account as an open installment account on my credit reports. 2.LHR violated 15 USC 1692e(8) by communicating credit information which is known or which should be known to be false, by reporting the account as open and installment on my credit reports. 3.LHR violated 15 USC 1692e(10) by using any false representation or deceptive means to collect or attempt to collect any debt by reporting the account as an open installment account on my credit reports and by calling yourselves a Factoring Company.
4. LHR has violated 15 USC 1692f by using unfair or unconscionable means to collect or attempt to collect any debt by reporting the account as an open and factoring company installment to deceive current and potential creditors and to negatively impact my credit scores.
5. LHR has violated 15 USC 1681s(2) by knowingly furnishing inaccurate information about a consumer to a consumer reporting agency.
6. LHR has violated FDCPA 808. LHR shows that the balance due is higher than the original amount on this debt. Please note that this sections states that--The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation unless such amount is expressly authorized by the agreement creating the debt or permitted by law. 7.LHR violated 15 USC 1692e(12)- labeling the account as Factoring Company account resulting in the false representation or implication that accounts have been turned over to innocent purchasers for value.
"8. Also, factoring is controlled strictly by Article 9 of the UCC, then factoring must be restricted to the kinds of secured transactions (goods and services) and accounts governed by the UCC. Consumer credit card debt is specifically excluded. Accounts transferred strictly for the purposes of collection are also excluded. The UCC article 9 goes into more detail. The point that I am making is that Credit Card debt can NOT be factored and COLLECTION ACCOUNTS can't be factored, then listing these types of accounts as FACTORING COMPANY ACCOUNTS is a violation of the both the FCRA and FDCPA"
LHR BBB Response. "We are in receipt of your 6/16/10 correspondence regarding the above referenced complaint. Please be advised that our office has investigated the matter and is taking the following position: LHR Inc purchased [consumer] charged-off HSBC/Direct Marketing account from the original creditor pursuant to a valid purchase agreement with assignment on 6/23/09. (never provided copy of) LHR reports solely to Experian enclosed is a Bulls-eye copy (will provide if requested) of our reporting. If Experian shares information with the other reporting agencies we cannot control that. As far as the difference in balances this account is accumulating interest. Lastly the credit reporting agencies define Factoring Company as: Factoring Company - A company that purchases accounts with the intent of collecting debts owed. LHR will continue to report this account as disputed, if consumer wants to resolve account consumer can call 1-800- or go to lhrpay.com. In addition, LHR Inc. strictly adheres to the FDCPA and does not condone unlawful debt collection practices by any of its employees. Thank you again for bringing this matter to our attention and please feel free to contact me with any questions that you may have."
My LHR BBB Response To Above. "I dispute LHR justification of this listing. LHR mentioned in their response that they used the definintion of debt buyer given by the Credit Bureaus definition of "Factoring Account" and that LHR strictly adheres to the FDCPA. If that is the case then LHR just contradicted themselves by not adhere to what the FDCPA says about "Factoring Accounts" and instead using the CDIA manual which credit bureaus use in order to guide business in reporting to the Credit Bureaus.
"LHR violated 15 USC 1692e(12)- labeling the account as Factoring Company account resulting in the false representation or implication that accounts have been turned over to innocent purchasers for value. Also, factoring is controlled strictly by Article 9 of the UCC, then factoring must be restricted to the kinds of secured transactions (goods and services) and accounts governed by the UCC. Consumer credit card debt is specifically excluded. Accounts transferred strictly for the purposes of collection are also excluded. The UCC article 9 goes into more detail. The point that I am making is that Credit Card debt can NOT be factored and COLLECTION ACCOUNTS can't be factored, then listing these types of accounts as FACTORING COMPANY ACCOUNTS is a violation of the both the FCRA and FDCPA.
Now since LHR wants to ignore the above and continue reporting as a factoring account they are violating:
"LHR has violated 15 USC 1692f by using unfair or unconscionable means to collect or attempt to collect any debt by reporting the account as an factoring account installment 1 month term to deceive current and potential creditors and to negatively impact my credit scores. Now if LHR is wondering why they are violating this this I will be happy to explain. By reporting the account as above it appears on all credit reports not as a collection but as an installment loan in which it notes that I am currently past 180 days on. An installment account other than a mortgage takes a more dramatic hit on credit scores than a collection account. Collection agencies are supposed to report as collection accounts.
"In the letter from LHR they also stated that they never reported the information to any other credit reporting agencies outside of Experian. I disputed the trade line multiple times with Transunion which LHR verified as correct. The account balance on Transunion is different than on Experian credit report. In the letter LHR provided they stated that the balance difference came from interest. Since LHR in the past have never provided me with any proof that they were assigned the debt outside of what was stated on the letter they gave I have never been given any proof of the account transactions and how interest would have been calculated on this debt. Since I asked LHR for proof and in the letter it is just because I said so. We are charging you interest.
"They are in violation of: LHR has violated FDCPA 808. LHR shows that the balance due is higher than the original amount on this debt. Please note that this sections states that The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation unless such amount is expressly authorized by the agreement creating the debt or permitted by law. Also in LHR letter it sounded as if LHR was trying to say since they use the CDIA/Metro2 software to report to the credit reporting bureaus that. Whatever that manual says is accurate and makes them in strict compliance with the FDCPA. LHR should have read the Disclaimer Section.
"Documented From Disclaimer in CDIA/Metro 2 Manual. The Credit Reporting Resource Guide (CRRG), the Metro 2 Format, and information from the Metro 2 Task Force concerning the Metro 2 Format are provided as informational resources to persons who furnish information to consumer reporting agencies using the Metro 2 Format. No legal advice. Any person using the CRRG, the Metro 2 Format, or information from the Metro 2 Task Force concerning the Metro 2 Format; or any software vendors that provide Metro 2 programming software acknowledges that such documents or communications are not made available for the purpose of providing legal advice or other counsel concerning the accuracy of the information furnished to a consumer reporting agency. Such persons rely solely upon their own determination as to the selection of the appropriate Metro 2 Code to meet any furnisher obligations under the FCRA.
"Disclaimer of liability. Any person using the CRRG, the Metro 2 Format, or information from the Metro 2 Task Force concerning the Metro 2 Format; or any software vendors that provide Metro 2 programming software acknowledges that the fees paid, directly or indirectly, to receive the CRRG, the Metro 2 Format, or information from the Metro 2 Task Force concerning the Metro 2 Format are based upon the expectation that such person will be solely responsible for the accuracy of the information furnished to a consumer reporting agency. LHR also said that they reported according to the CDIA/ Metro 2 Manual. LHR can't even use this as a defense because they reported wrong for how the manual states. Using the CDIA manual under Quick Reference Guide for Industry Standards.
"Factoring is the process of selling your accounts receivable to a third-party financing source. Typically, you will bill the shipper and then turn over a copy of the invoice to a factoring company. At that point, the factoring company will advance you 80 percent of the gross amount of the invoice less a percentage kept by the factoring company. The factoring company is now responsible for collecting the amount on the invoice from the shipper. When the amount is collected, the factoring company will send you the remaining amount of the invoice, minus another fee, perhaps.
"In layman's terms account factoring is a service provided to a company. Company ABC doesn't want to handle collecting money from their customers. So they sell all of their invoices to Company DEFG who then collects all payments and mails Company ABC the money for the invoice minus their fees. This is not what LHR does. Also to be a factoring company the debt has to be purchased while in good standing. LHR buys charged off debt which can't be factored. So in your bullet form LHR presented under type "FCO" meaning factoring company. LHR is representing themselves as something that they are not. LHR purchased a charged off debt.
"Terms: Should have been left blank. LHR choose code (1)- which is reported as terms are monthly. Account Status: It should be reported as 93-Account assigned to internal or external collections. Compliance Condition Code is right the reported as xb- account information disputed by consumer under the FCRA. Also please note that LHR is reporting the wrong date of last delinquency. LHR also provided a bullet sheet this is form there records. If LHR wants to continue to report this account as accurate. I want LHR to provide proof that they are a so called Factoring Company which they are reporting. The bullshit that they provided is only LHR system printout. Creditors have to use the form Universal Data Form to transmit information. I would like to be provided a copy of this form along with company records showing account history. Also for LHR to provide that they have a right to charge interest on this account."
LHR Response Back. "Please be advised that our office has reinvestigated the matter: I'm sorry that our response did not resolve consumer complaint, a Bulls-eye report from Experian as to how we are reporting was provided. Since the actual bill is not in dispute only the reporting of the debt is being disputed I would like to offer a solution. If consmer would call our office I'm sure a reasonable settlement arrangement can be reached. Once the account is paid and funds have cleared, LHR will have our trade-line submission completely deleted from consumer credit report.In addition, LHR Inc. strictly adheres to the FDCPA and does not condone unlawful debt collection practices by any of its employees. Thank you again for bringing this matter to our attention and please feel free to contact me with any questions that you may have."
The listing is bring my credit score down. By listing as a factoring company the alleged debt is listed as a installment non-mortage loan that is outstanding which hits your credit worest than a collection agency which they should be reported as.