Possible unauthorized Inquiry

[RobertEG]

Not to beat the point to death, but I think this might answer what is your underlying concern.

Take, for example, a situation where you pay all fees up front to set up an account, then have a monthly agreement to pay in advance for services to be rendered that month.  So no actual credit is advanced.  Is this is "credit transaction intiated by the consumer?"

In my opinion, it is.  There is no extension of credit as long as you meet the terms of pre-payment each month.  But what if you miss a payment?  You then have a debt with the creditor.  An extension of credit to you that is beyond their ability to predict in advance.  That is why the FCRA uses the term "credit transaction" rather than the more restrictive term of "prior advancement of a specific line of credit." 

If that were the definition of "credit transaction," then it would only apply to revolving credit.  That is clearly not the case.

It may all sound like legalese, but if you are going to challenge the legality of an inquiry, then it must become legalese.

[Anonymous]

I definitley agree!

[Anonymous]

The FTC has weighed in more than once on §604(a)(3)(F).

Read the Staff Opinion Letters.

[Anonymous]

Good info, thanks Noah!

[Anonymous]

I found a case in the 6th Circuit that narrows the scope of legitimate business need in § 604(a)(3)(F).

Smith v. Bob Smith Chevrolet, Inc., 275 F. Supp. 2d 808 - Dist. Court, WD Kentucky, Louisville 2003

I note that the court has taken judicious notice of informal FTC Staff Opinion Letters, and such I would encourage all to read them for their own benefit. Also read FTC Staff Commentary on the Fair Debt Collection Practices Act. Not just for matters involving inquiries but for all matters involving credit and debt.

A wise man told me, "You can get much further with a kind word and a 2x4 than you can with a kind word alone."

[RobertEG]

I dont disagree with the logic of legal arguments presented in prior FTC or District Court decisions, but unfortunately, neither of these set significant legal precedent. 

 All FTC advisory opinions, which they incidentally discontinued any issuance of more than ten years ago, are not binding legal opinions. And for good reason.  The FTC realized that the  executive branch should not be issuing interpretations of the application of the law.  That is the responsibility of the courts. 

Federal District Court decisions do not become legal precendent even in their appellant area until ratified by their superior  Fed Court of Appeals, and even then, are only precendent within that appellant jurisdiction. And unless what is said in any court decision is also directly on point with the specific legal issue upon which the case is decided,  it is just dicta, and has not precedential value.

Again, I have no disagreement with the opinions offered, I just urge caution in using them as legal, binding precedent in your case.

[Anonymous]

If an attorney took one's case on contingency, then I'd feel pretty good about using Smith in court. Otherwise, not so much.

In arbitration, or in an ITS letter for unauthorized INQs, then yeah I'd use Smith.