The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against credit reporting agency Experian for allegedly failing to properly investigate consumer disputes and for showing undue deference to institutional submissions.
The CFPB claims that Experian does not adequately intake, process, investigate, and inform consumers about disputes, leading to incorrect information being included in credit reports. “When consumers disputed errors on their credit reports, Experian conducted sham investigations rather than properly reviewing the disputes as required by federal law,” stated CFPB director Rohit Chopra. “Credit reporting errors can have serious consequences for a family’s finances, and it is critical that credit reporting giants follow the law.”
According to the CFPB, Experian “routinely and uncritically accepts the original furnisher’s response to disputed information, even when that response is improbable or illogical, or when Experian has other information that suggests the furnisher is unreliable.” A furnisher refers to an institution that provides consumer credit information to one or more major credit bureaus.
The CFPB further alleges that Experian fails to notify consumers of the results of investigations, instead providing notices that are confusing, ambiguous, incorrect, or inconsistent. Additionally, the company is accused of not implementing essential matching tools that would prevent or significantly decrease the chance of a new furnisher reintroducing a previously deleted tradeline. Consequently, consumers who have disputed inaccuracies may find the same incorrect information reappearing on their reports under a new furnisher’s name, with no explanation.
The CFPB’s lawsuit aims to halt these practices, provide restitution for affected consumers, and impose a civil monetary penalty on the company.