Earlier this week, the Consumer Financial Protection Bureau (CFPB) released its latest supervisory report covering July 2014 through December 2014. These reports highlight the examinations, corrective measures and consumer remediation resulting from the CFPB’s supervision of consumer financial service providers. This latest report covers student loan debt collection, overdraft, mortgage origination and fair lending practices. Notably, it also reveals the CFPB’s continued focus on consumer reporting agencies (CRAs).
The CFPB’s assessment of CRAs’ compliance with dispute-handling obligations under the Fair Credit Reporting Act (FCRA) was mixed. On the one hand, it acknowledged that CRAs “enhanced” their dispute-handling systems by including:
- online portals for consumers to submit disputes,
- systems to forward dispute documents received from consumers via mail, and
- improved practices for soliciting relevant dispute information from consumers.
On the other hand, the CFPB identified ongoing practices that it views as falling short of the dispute-handling requirements. These include failing to forward all relevant dispute information to furnishers and failing to update public record information. The CFPB has directed the relevant CRA(s) to develop training, policies and procedures to address these issues.
This supervisory report indicates that CRAs are not out of the spotlight yet. In fact, it comes on the heels of an announced agreement between New York state and the three major CRAs, following a years-long investigation into their practices, that requires the CRAs to provide increased protections to consumers. The agreement requires the CRAs to, among other things:
- ease requirements to initiate disputes,
- conduct an enhanced review of documentation submitted with consumer disputes,
- wait 180 days to report medical debt on consumer reports, and
- establish a working group to develop best practices for CRAs’ monitoring of furnishers and establish standards regarding the collection of public data.