Loker Law wins $4.375 million verdict against BMO Bank over credit reporting error

A federal jury in Northern California awarded $4.375 million to a Bay Area small-business owner after BMO Bank left an admitted mortgage error on her credit reports for more than seven months. The case underscores the stakes for lenders and credit bureaus when disputed information is not corrected quickly.

Why it matters: - The verdict puts a major dollar figure on the damage that can follow an uncorrected credit reporting error. - The case tests how seriously financial institutions must treat disputes under the Fair Credit Reporting Act and California consumer credit reporting law. - A wrong tradeline can affect borrowing, business operations, and personal health, not just a credit score.

What happened: - Loker Law secured a $4,375,000 jury verdict against BMO Bank, N.A. in U.S. District Court for the Northern District of California. - The plaintiff, Solmaz Dehcheshmeh, was inadvertently added to a mortgage of more than $1 million that she never agreed to and never signed. - BMO acknowledged the mistake within 24 hours, but the mortgage tradeline remained on Dehcheshmeh’s credit reports for more than seven months. - Dehcheshmeh formally disputed the information with Equifax, Experian and Trans Union, but BMO still verified the entry as accurate.

The details: - Dehcheshmeh said her credit score fell from about 750 to below 600. - She was denied credit 16 times. - She shelved the flagship app she had spent years building. - She shifted her startup to a stopgap product. - She took on high-interest personal debt to keep the business alive. - The stress extended a course of treatment that had been scheduled to end. - The situation escalated into severe anxiety, sleepless nights and a panic attack. - The case number is 24-cv-9225-NW.

Between the lines: - The verdict signals that admitting an error is not enough if the record is not fixed promptly. - It also suggests juries may view failure to investigate disputed credit data as a serious harm when the error affects a consumer’s business and health. - The case gives consumers and plaintiff lawyers a large-dollar example of how credit reporting mistakes can compound quickly.

What's next: - The verdict may push banks and credit bureaus to respond faster and document investigations more carefully when consumers dispute errors. - The outcome may also influence how similar FCRA and state credit reporting cases are litigated in federal court. - Loker Law said the case reinforces the need to correct inaccurate information before a consumer’s financial life is damaged further.

The bottom line: - A jury found that leaving an admitted credit error uncorrected can carry a multimillion-dollar cost.