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The latest on the Key Bridge collapse, New York puts forth legislation to get clean energy projects on the grid and Wisconsin and other states join a federal summer food program to help feed kids across the country.

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Republicans float conspiracy theories on the collapse of Baltimore's Key Bridge, South Carolina's congressional elections will use a map ruled unconstitutional, and the Senate schedules an impeachment trial for Homeland Secretary Mayorkas.

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Historic wildfires could create housing and health issues for rural Texans, a Kentucky program helps prison parolees start a new life, and descendants of Nicodemus, Kansas celebrate the Black settlers who journeyed across the 1870s plains seeking self-governance.

Advocates: CA Bill Triggers Anti-Consumer Credit Reporting Loophole

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Wednesday, March 23, 2022   

A bill in the California Legislature to regulate credit-repair organizations has advocates concerned because it triggers a federal loophole allowing debt collectors to ignore correspondence on behalf of consumers.

Under Assembly Bill 2424, credit-repair organizations in the state would be required to identify themselves on their correspondence to debt collectors when attempting to help people with credit-report errors or other issues.

Eric Kamerath, legal counsel for the Lexington Law Firm, which helps people with their credit reports, said because federal law preempts California regulations in a conflict, debt collectors can ignore the letters they receive from advocates.

"Under existing federal law, if Assembly Bill 2424 passed, consumer correspondence that identified any third-party assistance, even from a non-profit organization, could be ignored," Kamerath explained.

The loophole under the Fair Credit Reporting Act allows debt collectors, furnishers and credit-reporting agencies to ignore, without explanation, any letter sent on behalf of a consumer by a third party.

On the federal level, Rep. Maxine Waters, D-Calif., who chairs the House Committee on Financial Services, has called for an overhaul of the U.S. credit-reporting system.

Andre Chapple, CEO of the African American Empowerment Coalition in Los Angeles, which assists communities with fixing errors on credit reports, along with free financial workshops twice a week bringing in 150-200 people, said the federal loophole can have long-term effects if people are unable to get help to fix their credit.

"We don't tell people that they can't hire a plumber," Chapple remarked. "We allow people in every industry to use an expert if they choose to do so, because it doesn't take their right away to do it themselves, but it gives them an option to do it with someone who actually does this every day and has the expertise to do it."

The bill will have a hearing in the Assembly Banking and Finance Committee next Monday.


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