One LendingTree suit deserves another

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

LendingTree, the big electronic matchmaker for home buyers and lenders, last month accused two former executives of swiping passwords and letting unauthorized mortgage brokers in Orange County pitch LendingTree clients.

Last week, one of those clients suggested that LendingTree take a look in the mirror. Marvin Garcia filed a lawsuit (download a PDF here) in U.S. District Court in New York against the Charlotte, N.C.-based unit of IAC/InterActive Corp. for alleged negligence.

The suit, which seeks permission to proceed as a class-action case, says LendingTree should have done a better job of safeguarding millions of customer loan request forms, which included Social Security numbers and job and income data.

After LendingTree sued the Orange County mortgage brokers and advised its customers to check their credit reports, Garcia went to Trans Union and ‘was shocked to see that his credit report had been pulled for review by almost a dozen lenders without his permission,’ hurting his credit score, the suit says.

A LendingTree spokeswoman declined to comment.

LendingTree said last month that it had been cooperating with unnamed authorities investigating the case. Former employees of one of the defendant companies, Sage Credit Co., later said the FBI had raided their offices.

-- Joseph Menn