Credit reporting lawsuit overview:
- Who: Hugo Saavedra is suing Synchrony Bank, Experian Information Solutions Inc., Equifax Information Services LLC and TransUnion LLC.
- Why: Saavedra alleges that Synchrony Bank continued reporting a canceled debt as unpaid even after issuing a formal Internal Revenue Service (IRS) debt cancellation notice.
- Where: The credit reporting lawsuit was filed in California federal court.
- How to get help: If you received excessive debt collection calls or were subjected to unlawful collection practices, you may qualify to participate in a debt collection lawsuit investigation.
A new credit reporting lawsuit alleges Synchrony Bank continued to report a canceled debt as due and owing on a consumer’s credit reports despite having formally canceled the debt and reported the cancellation to the Internal Revenue Service.
Plaintiff Hugo Saavedra claims that before canceling the debt, Synchrony Bank actively pursued collection through telephone calls, letters and notices — and that after canceling it under IRS Form 1099-C, all such activity ceased, confirming the debt was genuinely discharged.
Despite this, Saavedra alleges Synchrony Bank continued reporting the account as a derogatory charged-off balance to credit reporting agencies Experian, Equifax and TransUnion, which reported the false balance on Saavedra’s consumer credit reports.
Saavedra disputed the reporting with all three credit reporting agencies in March and April 2026, but Synchrony Bank allegedly verified the erroneous information as accurate, while all three agencies allegedly failed to investigate or remove it.
Saavedra was denied credit as a direct result, refrained from applying for needed credit and lost time and money resolving the dispute, including costs for phone calls and postage.
Credit reporting bureaus allegedly sided with Synchrony Bank despite debt cancellation
The credit reporting lawsuit alleges, “Experian, Equifax and TransUnion relied on their own judgment and the information provided to them by Synchrony rather than grant credence to the information provided by the plaintiff.”
The complaint details specific investigative failures across all four defendants. Synchrony Bank allegedly failed to contact Saavedra and third parties or review the underlying account information. Instead, the bank allegedly verified the false and misleading information to all three bureaus.
Synchrony Bank is accused of violating the Fair Credit Reporting Act (FCRA) as a furnisher of credit information, with additional claims under California’s Rosenthal Fair Debt Collection Practices Act and the California Consumer Credit Reporting Agencies Act.
Experian, Equifax and TransUnion are each accused of violating the FCRA by failing to ensure the maximum possible accuracy and failing to delete inaccurate information from Saavedra’s credit files.
Saavedra seeks actual, statutory and punitive damages against all defendants as well as additional statutory damages of $1,000 against Synchrony Bank under the Rosenthal Act.
Meanwhile, Synchrony Bank is facing a class action lawsuit for repeatedly sending prerecorded debt collection voice messages even after the debtor revoked her consent to receive such messages and retained legal counsel regarding the debts.
Have you ever experienced inaccurate credit reporting by Synchrony Bank or a major credit bureau? Let us know in the comments.
The plaintiff is represented by Garrett Charity of McCarthy Law PLC.
The credit reporting lawsuit is Saavedra v. Synchrony Bank, et al., Case No. 2:26-cv-06230, in the United States District Court for the Central District of California.
Don’t Miss Out!
Check out our list of Class Action Lawsuits and Class Action Settlements you may qualify to join!
Read About More Class Action Lawsuits & Class Action Settlements:
