| Entities | |
| Topics and Issues | Identity theft (12) |
In April 2024, the CFPB issued Supervisory Highlights: consumer reporting companies and furnishers (Issue 32, Spring 2024). In a press release covering the Supervisory Highlights noted “key findings from recent examinations about continuing accuracy problems in the credit reporting system. The CFPB found consumer reporting companies failed to ensure the accuracy of credit reports, including by failing to exclude information resulting from alleged identity theft or human trafficking. The CFPB also found furnishers – companies that provide information to consumer reporting companies – failed to correct false or fraudulent information sent to consumer reporting companies.”
As noted in the press release:
The CFPB continues to prioritize examinations of consumer reporting companies and furnishers. CFPB examiners have found failures by these companies to follow a rule implemented in June 2022 to help survivors mitigate the financial consequences of human trafficking. The rule requires credit reporting companies to block, from credit reports, adverse information that resulted from human trafficking. Specifically, today’s edition of Supervisory Highlights found:
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- Consumer reporting companies failed to block or remove information related to identity theft and human trafficking: Examiners found that companies refused to honor consumer requests to block information associated with identity theft based on overbroad criteria; failed to inform consumers when blocks were denied or rescinded; failed to provide victims of identity theft with summaries of rights; and failed to timely block all information resulting from human trafficking identified by consumers.
- Consumer reporting companies accepted information from unreliable furnishers: Examiners found companies accepted information from furnishers that may have been no longer providing reliable, verifiable information about consumers. For example, consumer reporting companies continued to include information from furnishers that failed to respond to all or nearly all disputes or that issued the same responses to all disputes.
- Furnishers provided information to consumer reporting companies they knew was false: Examiners found that auto loan furnishers continued to share incomplete or inaccurate information for several months or even years after learning the information was false, incomplete, or inaccurate. In other instances, furnishers provided information even after they determined the information was fraudulent or due to identity theft.
- Furnishers did not follow requirements for dispute investigations and identity theft: Examiners found that some furnishers continued to furnish information that consumers were disputing without indicating the information was in dispute. In other instances, furnishers failed to conduct investigations into the accuracy of information consumers disputed.
In response to the CFPB’s findings, the involved consumer reporting companies and furnishers are taking corrective actions. For example, CFPB examiners directed consumer reporting companies to revise their compliance processes to ensure that they process all human trafficking block requests per the law. In other instances, furnishers conducted lookbacks to ensure they deleted all accounts they determined to be opened fraudulently.
Table of Contents:
2. Supervisory Observations.
2.1 Consumer Reporting Companies.
2.1.1 CRC duty to block the reporting of information resulting from an alleged identify theft.
2.1.2 CRC duty to promptly notify consumers after declining to implement, or rescind, an identity block.
2.1.3 CRC duty to provide victims of identity theft with summaries of rights.
2.1.4 CRC duty to block adverse information resulting from human trafficking.
2.1.5 CRC duty to follow reasonable procedures to assure maximum possible accuracy.
2.2 Furnishers.
2.2.1 Furnisher duty to promptly correct and update information determined to be incomplete or inaccurate.
2.2.2 Furnisher duty to notify CRCs of direct disputes.
2.2.3 Furnisher duty to conduct reasonable investigations of direct disputes.
2.2.4 Furnisher duty to provide notice of delinquency of accounts.
2.2.5 Furnisher duty not to furnish information that purports to relate to a consumer upon receipt of an identity theft report.
3. Supervisory Program Developments.
3.1 Recent CFPB Supervisory Program Developments
3.1.1 CFPB issued advisory opinion on fair credit reporting: background screening
3.1.2 CFPB issues advisory opinion on file disclosures