Twenty-one state attorneys general and the District of Columbia attorney general have sent a letter to the three nationwide consumer reporting agencies (CRAs) “to remind them” of their legal obligations under federal and state law as well as under agreements between the AGs and the CRAs entered into in 2015.
The letter appears intended to serve as a warning to the CRAs that they should not take comfort from the CFPB’s “recent announcement suggest[ing] that it will not enforce the FCRA’s 30- or 45-day deadline to investigate consumer disputes requirements during the COVID-19 crisis.” The AGs reference the April 13 letter that they sent to CFPB Director Kraninger asking the CFPB to immediately withdraw its guidance regarding credit reporting during the COVID-19 pandemic and “resum[e] vigorous oversight of consumer reporting agencies and enforcement of the FCRA.” The CFPB stated in the guidance that it “will consider a consumer reporting agency’s or furnisher’s individual circumstances and does not intend to cite in an examination or bring an enforcement action against a consumer reporting agency or furnisher making good faith efforts to investigate disputes as quickly as possible, even if dispute investigations take longer than the statutory framework.”
In their letter to Director Kraninger, as they do in their letter to the CRAs, the AGs mischaracterize the CFPB’s statement in the guidance, claiming that the CFPB suggested it will no longer take enforcement or supervisory actions against CRAs for failing to investigate consumer disputes in a timely fashion. Their letter to the CRAs also mischaracterizes Director Kraninger’s response to their April 13 letter as not giving any assurances regarding the CFPB’s intent to enforce the FCRA’s dispute investigation deadlines. In fact, Director Kraninger specifically refuted the AGs’ characterization of the CFPB’s statement and indicated that while the Bureau will consider an entity’s good faith compliance efforts, it “will not hesitate to take public enforcement action when appropriate against companies or individuals that violate FCRA or any other law under our jurisdiction.”
While conceding in their letter to the CRAs that the CFPB intends to enforce the CARES Act provision that requires lenders to continue reporting loans as current if they were current before a forbearance or other accommodation, the AGs indicate that they “will actively monitor for and enforce” compliance with this provision. With regard to dispute investigations, the AGs similarly indicate that they “will actively monitor for and enforce CRAs’ compliance” with their obligations “to conduct meaningful and timely investigations of consumer disputes of credit information” and “will not hesitate to hold CRAs accountable if they fail to meet these obligations.” The AGs also include a warning that that intend to “monitor furnishers to ensure that they do not improperly report negative credit information.”