CFPB Issues Fair Credit Reporting Act Guidance

On September 4, 2013, the Consumer Financial Protection Bureau (CFPB) issued CFPB Bulletin 2013-09 to provide guidance on the Fair Credit Reporting Act (FCRA) requirement that furnishers of information to consumer reporting agencies (CRAs), including debt buying and debt collection companies, investigate consumer disputes that arise from the reported information.

In order to comply with the FCRA requirement, the CFPB expects furnishers to:

  1. Maintain a system reasonably capable of receiving from CRAs information regarding disputes, including supporting documentation;
  2. Conduct an investigation of the disputed information including reviewing;
    1. “all relevant information” forwarded by the CRA; and
    2. the furnisher’s own information with respect to the dispute;
  3. Report the results of the investigation to the CRA that sent the dispute;
  4. Provide corrected information to every nationwide CRA that received the information if the information is inaccurate or incomplete; and
  5. Modify or delete the disputed information, or permanently block the reporting of the information if the information is incomplete or inaccurate, or cannot be verified.

The CFPB Bulletin states that, “Any furnisher not currently maintaining a process that meets these requirements should take immediate steps to comply with the requirements of the law” or the CFPB may “take appropriate supervisory and enforcement actions.”

The CFPB Bulletin emphasizes the strong interest among federal agencies to monitor how furnishers handle FCRA-related consumer complaints. In August 2013, the Federal Trade Commission (FTC) brought its first enforcement action under the FCRA Furnisher Rule against Certegy Check Services, Inc. The company allegedly failed to comply with the 30-45 day dispute reinvestigation deadline as set forth in the FCRA. The FTC also alleged that Certegy failed to adopt written polities to governess its role as a furnisher of information. The FTC imposed a $3.5 million civil penalty against the company.