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LendingTree sued over data breach

Bronx man sues LendingTree for negligence after security breach exposes his personal data and affects his credit history.

One month after suing three lending firms, LendingTree has now been sued by a Bronx man who claims a security breach with the mortgage site has harmed his credit score, led to higher credit card interest rates, and resulted in him getting rejected for at least one loan.

The lawsuit against LendingTree, filed late last week in U.S. District Court in Manhattan, seeks class action status. Filed on behalf of Marvin Garcia, it alleges that LendingTree was negligent in failing to keep customer personal information secure and failing to notify customers of the security breach in a timely manner.

The breaches--which involved names and Social Security numbers among other personal information--are believed to have begun in October 2006, but LendingTree did not notify customers until last month.

LendingTree also is placing the responsibility and cost on customers for monitoring their credit reports and trying to repair negative impacts on their credit history from the breach, the lawsuit says.

After being notified of the breach, Garcia obtained a copy of his credit report and found that nearly a dozen lenders had pulled his personal information for review without his permission, which affected his credit score, interest rates, and mortgage loan application, according to the lawsuit, which was filed by lawyers at the firm of Meiselman, Denlea, Packman, Carton & Eberz.

A LendingTree representative did not immediately return a call seeking comment on the lawsuit.

LendingTree said last month it was suing Newport Lending Group and Sage Credit Company, both of Irvine, Calif., and Home Loan Consultants of Newport Beach, Calif., over the breach. LendingTree said at the time that several former employees were believed to have taken company passwords and given them to a handful of lenders who then accessed LendingTree customer data files.