Arrow Financial Reporting very confusing...

[Bklyn395]

I have an account that was settled in full with two payments, one 12/07 and one 1/08.  I got the letter stating the account was satisfied and closed before the end of January.  Here is what they report for experian on freecreditreport.com (it's not under experian on myfico, but IS under equifax, more on that later...):

EXPERIAN
Account Name: ARROW FINANCIAL SERVIC       
Account Number: XXXXXXXXX       
Acct Type: Collection Department / Agency / Attorney       
Acct Status: Closed       
Monthly Payment:        
Date Open: 8/1/2005       
Balance:        
Terms: 1 Month       
High Balance:        
Limit:        
Past Due:        
Payment Status: Paid, was a collection account, insurance claim or government claim or was terminated for default        
Date:               Sep     Oct     Nov      Dec      Jan      Feb
Experian:          07       07       07       07        08       08 
                                                                     KD

(for the sake of keeping it lined up, I only included the last 6 months reporting, but 2/08 is the only one with data.)                                                
Is this a FCRA violation for them to report a derog after the account was paid in full?  Can someone put a negative comment on your credit report a month after the account has been settled and closed?

Now on Equifax, my score just went up 7 points and according to ScoreWatch, it was due to the same account.  Here is how that looks:

                 Previously reported                                  Newly reported

Balance:                 $0                                                    $0

Past due:                $0                                                      Not Reported

Status:     At least 120 days or more than        At least 120 days or more than 

                      four payments past due            four payments past due

Last activity:        1/1/2005                                              1/1/2005

Description: Consumer disputes this                Consumer disputes this 
                    account information                   account information

                                                                       Settlement accepted on this account
                     Collection account                     Paid collection

Now how can that status be correct?  How can it be 120 days past due AND be paid?  Why is it under experian on freecreditreport and not myfico but both for equifax? This account doesn't show on Transunion at all. 

I appreciate any feedback anyone is able to give!  Thanks!!!

[Anonymous]

A collection account can not show lates...but you need to read up on them...I think they are one of the nasty CA..that does things dirty...