Originally, the FCRA provided only one dispute process for consumers, and that required all disputes to be filed with the CRAs. FCRA 611(a).
However, conumers and congress soon realized that CRA involvmement in the dispute process was adding unnecesary CRA meddling, and unnecessary delays in the process. This was particularly aggravating by the use of the CRAs of their automated "e-Oscar" process, which reduced the substance of your dispute to only a three-digit code. Much supporting information simply did not get forwarded to the creditor.
In approx. 1998, consumer advocacy groups were able to get a direct dispute process added to the FCRA, which is set forth at FCRA 623(a)(8).
However, credit industry advocacy groups strongly opposed this legislation. As a compromise, in order to get the legislation enacted, it included a section 623(a)(8)(A) which postponed the enactment of the direct dispute process until after final rules had been published in the Federal Register. Those final rules, after much haggling, were finally published in the Fed Reg on July 1, 2009, with a date of enactment of 7/1/2010. See 31484 FedReg/Vol 74, No. 125, Wed, July 1, 2009.
Those final rules have now been published in the Code of Federal Regulations at 16 CFR 660.4. They have the full force and effect of law.
Thus, as of 7/1/2010, the consumer has the option to bypass the entire CRA dispute process, and dispute directly with the party who furnished the disputed information to the CRA. This dispute proces is set forth at FCRA 623(a)(8), as further defined in process details by 16 CFR 660.4.
Creditors and debt collectors, as of 7/1/2010, MUST accept and investigate direct disputes. It is now federal law.They have 30-days to complete their investigtion, and five days after that to send you the results in writing.
Here is a sample direct dispute template:
“This is a Notice of Direct Dispute with you, under the provisions of FCRA §623(a)(8)(D), of the accuracy of information you have reported to my credit file.
► (If sent to a debt collector, (CA), it might be beneficial to also include the blurb:
► “This is a direct dispute of credit reporting. This is not a request for debt
validation/verification under FDCPA §809(b).”.
(don’t let them just simply sluff it off as a meaningless DV letter)
“In compliance with FCRA §623(a)(8)(D), and enacting regulations published at 16 CFR § 660.4, this Notice of Direct dispute includes:
“Identification of the specific information being disputed:
(specify the account number, and the specific information that is disputed under
that identifying account)
“Basis for the dispute:
(how the reporting was inaccurate; was any reporting in violation of any statutory or
regulatory provisions? account or express agreements? CRA reporting gudelines? Account not
yours? etc.)
“Supporting documentation:
(all documents that support your dispute; make sure to include,
as part of your documentation, at least a copy of the portion only of your
recent credit report showing their reporting of the disputed information was
actually reported to your credit flle. The implementing rule suggests a showing
that it appeared in your credit report)
“Under the provisions of FCRA §623(a)(8)(E) and 16 CFR §660.4,, you have the duty to review all of the information I have provided to you, to complete your investigation of this Direct Dispute within 30-days of my Notice of Direct Dispute, and report back to me the results of your investigation within 5-days of your completion of your investigation.”
“Should you find the disputed information to be inaccurate or incomplete, or you cannot verify the accuracy or completeness of the disputed information, you are additionally required, under FCRA §623(b)(1)(E), to promptly notify the credit reporting agencies of correction of this information, or of its deletion from my credit file.”
