The Fair Credit Reporting Act (FCRA) is an important federal law that outlines consumer rights and the responsibilities of credit reporting agencies. If a credit reporting agency, like one of the big credit bureaus, or a credit furnisher, like a utility company, violates one of your rights, you may have grounds to take them to court. Should your lawsuit be successful, you might then be entitled to certain damages.
But just what damages are awarded under the FCRA? In truth, it can get a little complicated. Let’s take a closer look.
Put simply, “damages” are monetary awards given by a court to a case plaintiff. For example, if you sue a credit bureau for violating your consumer rights under the FCRA and your lawsuit is successful, you may receive damages in the form of monetary payments. The monetary payments are intended to:
However, the exact type of damages you may receive – and the total monetary value you could see as a result – depends on the circumstances of the crime and the type of case you bring to court. Furthermore, the FCRA limits the damages you might be entitled to in some situations.
According to the FCRA, a credit reporting agency/credit bureau, credit furnisher, or background check agency may be ordered to pay four different types of damages.
Actual damages are “actual” in that they’re intended to compensate you for any losses you might have experienced because of the FCRA violation.
Say that you interview for a job that will pay you $60,000 a year. The interview goes very well, and you are more than qualified for the position. Unfortunately, you receive an adverse action letter from the prospective employer after the interview stating that information on your credit report convinced that employer to change its mind.
When you investigate your credit report, you notice inaccurate information mentioning a criminal history that’s false. You inform the credit bureau responsible for the misinformation of this, but it doesn’t commit an investigation like it should under the FCRA.
You take the credit bureau to court, prove that it violated your FCRA rights, and receive thousands of dollars in damages. The actual damages are intended to compensate you for lost time and income since you could have been employed and earning a paycheck.
Under the FCRA, there’s no limit to the actual damages you may be awarded. The court’s final actual damages number will depend on:
Statutory damages are direct penalties levied against the credit bureau or reporting agency that committed the rights violation. Under the terms of the FCRA, each individual rights violation committed by the defendant in a case could require them to pay between $100 and $1000.
So, for instance, if a credit bureau commits not just one but three different rights violations (e.g., doesn't commit investigation of misinformation, doesn't inform a prospective employer of the incorrect information, and doesn't correct inaccurate information when informed of it), it could be on the hook for up to $3000.
Note that statutory damages always have a direct limit per violation: $1000.
Furthermore, victims of FCRA rights violations may be entitled to costs. Costs are specific damages meant to cover the fees associated with legal representation, like attorney fees and related expenses.
When you hire consumer rights attorneys to represent you in court during an FCRA lawsuit, you don’t have to pay those attorneys anything. That’s because, per the FCRA, the defendant in the case is responsible for reasonable attorney fees if they are found guilty of a rights violation.
Costs include not just attorney fees but any expenses you might have in order to bring a lawsuit to court. These can include court fees, fees for investigations or supplies, etc.
Last are punitive damages, which are damages intended to punish the defendant in an FCRA rights violation case. Punitive damages are meant to serve as a warning to other credit bureaus or organizations so they don’t commit the same rights violations in the future.
There’s no limit to punitive damages, but courts usually only award punitive damages in FCRA violation cases if the violation caused “excessive harm.” What constitutes “excessive” depends on the circumstances of the case, the opinion of the court, and other factors. Knowledgeable, experienced attorneys may be more able to convince a court that your case is egregious enough to warrant punitive damages.
Before you take your case to trial and hear the outcome, you want to know for sure what FCRA damages you may be awarded. However, if you work with consumer rights attorneys, they may be able to make predictions based on their experience, previous cases they have worked on that are similar to yours, and other factors.
If your FCRA case is successful to any extent, you should receive statutory damages to compensate you for each rights violation you suffered. However, actual damages, punitive damages, and costs can all vary heavily. Knowledgeable attorneys may be able to provide some insight into this matter.
However, don’t hire an attorney that claims they can 100% accurately guess the damages you will receive. Even the most experienced attorneys can never know how a court will rule on these specific factors.
Ultimately, you could receive hundreds or thousands of dollars from a successful lawsuit if your FCRA rights are violated. But you’ll stand a better chance of securing those damages if knowledgeable attorneys are at your side.
Our experienced lawyers are well-equipped and ready to hear the details of your case and provide sound legal counsel. Contact us today for a free consultation and more information.