Capital One Unlawfully Obtained Credit Reports for Accounts Discharged in Bankruptcy, Class Action Claims

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A former Capital One Bank (USA) N.A. customer whose credit card debt was reportedly discharged in bankruptcy claims the bank later obtained his consumer report without a permissible purpose or written authorization to do so.

According to the lawsuit, Capital One has overstepped the Fair Credit Reporting Act (FCRA) by performing “account reviews” on customers whose debts were discharged in bankruptcy.

The plaintiff, a New Jersey consumer, says that in August 2018 he filed a Chapter 7 bankruptcy proceeding through which he was granted a discharge of his personal liability for debts, including any owed on his Capital One credit card.

After the plaintiff filed for bankruptcy, he no longer had any relationship with Capital One, per the complaint.

Despite the lack of a credit relationship with the plaintiff, the defendant accessed the man’s credit report in December 2018 “without consent or any lawful reason,” the suit says. According to the case, the inquiry was framed as an “account review” even though the plaintiff had not requested credit from Capital One or authorized the bank to obtain his private credit report “or any information.”

Under the FCRA, credit reports may only be obtained with the written consent of the report’s subject or for certain “permissible purposes,” the lawsuit argues. Per the complaint, Capital One had neither.

“The Defendant knew that it did not have any right to obtain the consumer report of [the plaintiff] for an account review,” the complaint states. “Defendant did not have either written consent or a permissible purpose.”

According to the suit, Capital One has obtained credit reports under false pretenses and illegally invaded the privacy of the plaintiff and other consumers.

Originally filed in Essex County, New Jersey Superior Court, the lawsuit was removed to the state’s District Court in Newark on December 4, 2020.

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