Negligent Credit Reporting of Discharged Debt Not Punished In MA
By L. Jed Berliner, Springfield Bankruptcy Attorney on Oct 14, 2007 in Bankruptcy Cases of Interest, Bankruptcy Practice and Procedure, Consumer Protection, Credit Reports, Decisions of Interest, Discharge Violations, Life After Bankruptcy, Massachusetts, Role Of The Lawyer
A creditor must act intentionally to collect or enforce a discharged debt, and with knowledge of a bankruptcy discharge, before sanctions in Massachusetts are appropriate. This must be proven by clear and convincing evidence (although it need not include a specific intent to violate the discharge). Therefore, a negligent inclusion of false data in a credit report is not actionable - especially where it was promptly corrected upon demand. So ruled Judge Somma in In re Schlichtmann, 2007 Bankr. LEXIS 3258 (Bankr D MA 09/25/07).
Credit reports containing discharged debts is a growing problem for honest but unfortunate debtors. Vigorous and focused work by debtor’s counsel is required to prove intentional or reckless disregard of a bnkruptcy discharge by the erroneously reporting creditor. These efforts are not always successful, although better results might be achieved with suits under credit reporting laws.
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