Adverse Action
  
It's basically just what it sounds like: a fancy term for things going wrong.
Adverse actions catalogue the times when the world's big bureaucracies - the government, financial institutions, corporate entities - turn against you. They're an official record of your bad days.
Adverse actions come up frequently in the contexts of credit checks and employment. You know how in school, vice principals were always threatening to put things on your permanent record? Adverse actions are kind of like that. They are notices that come up when people do certain checks, like when a lender looks at your credit report, or when an employer does a background check before hiring you.
Related or Semi-related Video
![Finance: What is a Comfort Letter?](https://media1.shmoop.com/video/thumbnails/COURSE.FINANCE.657_770x433.jpg)
Finance: What is a Comfort Letter?6 Views
Finance a la shmoop what is a comfort letter? S....See the smooth curves there is [An S letter appears]
that comforting okay okay comfort letter is a letter
this kind of letter written by an expert usually someone like an auditor or a tax [Expert appears with comfort letter]
attorney in one form or another who has done deep due diligence into a company
looked at myriad details and data and volume counts of plastic cubes in their
inventory and then they've looked at their distribution contracts
you know with truckers and retail stores and drone deliverers and then they've [Drone flying in the air]
looked at their bank accounts both the onshore ones and the offshore ones that
you know they don't really like to talk about and then about 87 ish other things
that all those people look at and then they write a letter like an actual
letter which is usually given to the Board of Directors or an acquirer or
the investigating party whoever that is and that letter states that what the
company says it has or does is in fact what it has or does which is a good [Man discussing comfort letters]
thing to know so this letter well it just gives comfort to everyone
the only challenge can be you know trying not to become too comfortable [Man working near a waterfall]
Up Next
What is a Commitment Letter? A commitment letter is a document that is issued by a lender to a borrower pursuant to a full fledged loan agreement c...
What is a Compliance Department? Every time there is a catastrophic financial crisis, criminal or foreign attack, Congress reactively enacts more l...
What is a Firm Deal: Commit, Quote? An underwriter gives a firm commitment when a company decides to have an IPO. When they give a firm commitment,...