The Consumer Financial Protection Bureau said the firm failed to investigate claims
of ConsumerAffairsThe Consumer Financial Protection Bureau has imposed a $15 million fine on Equifax, a consumer reporting agency, for failing to adequately investigate consumer disputes regarding credit reports. The enforcement action highlighted what it said were significant lapses in Equifax's processes, which have led to inaccuracies in consumer credit scores and reports.
The CFPB said its investigation revealed that Equifax consistently ignored consumer-submitted documents and evidence when handling disputes. This alleged negligence allowed previously corrected inaccuracies to resurface in credit reports.
The investigation reportedly found that consumers received confusing and contradictory communication from Equifax regarding the outcomes of their disputes, undermining trust in the accuracy of their credit information.
Equifax, headquartered in Atlanta, is one of the three major consumer reporting agencies in the United States. The company processes approximately 765,000 disputes each month, aggregating data on most adult consumers and selling it to lenders, employers, and landlords, who use this information to make critical decisions.
Under the Fair Credit Reporting Act, consumer reporting agencies like Equifax are mandated to ensure the accuracy of disputed information. They must notify the furnisher of the disputed data, conduct thorough investigations, and communicate the results to the consumer.
However, the CFPB found that Equifax violated these requirements, relying excessively on furnishers' responses without proper scrutiny and failing to consider contradictory evidence.
Previously disputed errors reappeared
CFPB said Equifax's flawed systems also failed to prevent previously deleted errors from reappearing on credit reports. The company lacked mechanisms to identify and block information related to identity theft, forcing consumers to repeatedly dispute the same inaccuracies. Additionally, coding errors in Equifax's software reportedly led to the dissemination of inaccurate credit scores for hundreds of thousands of consumers, further compounding the issue.
"Equifax failed in its basic duty to investigate and resolve consumer disputes about inaccurate information on their credit reports," said CFPB Director Rohit Chopra.
The CFPB's order mandates that Equifax comply with federal laws governing credit reporting disputes and pay a $15 million civil penalty, which will be allocated to the CFPB's victims relief fund.
Photo Credit: Consumer Affairs News Department Images
Posted: 2025-01-17 15:58:26
