Academic journal article ABA Banking Journal

A Bank's Duties When "Active Duty" Alert Is Spotted

Academic journal article ABA Banking Journal

A Bank's Duties When "Active Duty" Alert Is Spotted

Article excerpt

Q. When the bank receives a loan application from an individual who has an active duty alert on his/her credit bureau report, what obligations does the bank have to attempt to contact the individual? If the bank would be declining the loan for other reasons (poor credit, lack of collateral value, insufficient income, etc.), is it required to contact or attempt to contact the applicant before declining the loan? Must the bank document this process? Can it just decline the loan because of the alert?

A. When you receive a credit report with an Active Duty Alert, the first action you should take is verification of the legitimacy of the application.

The active duty alert allows active duty military personnel to place a notation on their credit report as a way to alert potential creditors to possible fraud. Active duty personnel are particularly vulnerable to identity theft when stationed outside the country and often lack the ability to monitor their credit bureau activity. The requirement to positively identify the applicant does not disappear if you are declining the loan. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.