Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36For more information, please visit or 15 14 key Trends This year, the CFPB continued to focus its enforcement efforts against credit repair companies on misrepre- sentations to consumers about tradelines that can be removed from credit reports, and unlawful upfront fees for credit repair services. The CFPB alleged that companies who advertise that they can remove any negative information from a consumer’s credit report engage in unfair and deceptive marketing practices, and aggressively pursued civil monetary penalties and injunctive relief related to such practices. In addition, the CFPB pursued enforcement actions against credit repair companies for charging unlawful upfront fees. When compared to last year, however, state attorneys general were less active in bringing actions related to credit reporting. credit reporting In 2016, Goodwin tracked seven enforcement actions related to credit reporting or credit repair services. The CFPB, FTC, and state attorneys general primarily targeted credit reporting agencies, debt collectors, and credit repair companies for alleged violations of the Fair Credit Reporting Act (FCRA), the Unfair, Deceptive, Abusive Acts or Practices (UDAAP) provision of the CFPA, the FTC Act, and state consumer protection laws. These agencies collected civil monetary penalties and consumer relief totaling approximately $7.4 million. The enforcement actions focused mostly on illegal upfront fees for credit repair services, misrepresentations to consumers about which items can be removed from credit reports, and inaccuracies on credit reports. Goodwin also covered significant litigation matters affecting lenders, credit reporting agencies, credit repair companies and other furnishers of credit information, including the Supreme Court’s much anticipated Spokeo decision regarding standing to sue under FCRA. 2016 Highlights The Supreme Court Issues Highly Anticipated Deci- sion on Standing Under FCRA. In Spokeo v. Robbins, 136 S. Ct. 1540 (2016), the Supreme Court held that the mere violation of a federal statute (in this case, FCRA) without more is not enough to confer Article III standing to sue. Rather, the Court held, a plaintiff must allege an injury that is both concrete and particularized to him or her. A plaintiff cannot satisfy this requirement by “alleg- ing a bare procedural violation” of FCRA, such as failing to provide certain notices required by FCRA, which do not cause any harm. Mississippi Attorney General Settles with Three Major Credit Reporting Agencies. In October, the Mississippi Attorney General reported a $7.175 million settlement with the three major credit reporting agencies—Equifax, Transunion, and Experian—over concerns regarding inaccurate consumer credit reports. The settlement arose from an investigation into consumer complaints that they (i) failed to adequately ensure the accuracy of consumer reports or credit reports, (ii) failed to update credit reports when civil judgments were paid or dis- missed, and (iii) engaged in deceptive marketing prac- tices related to advertisements for expensive monthly credit monitoring services. CFPB Sues Credit Repair Company. In September, the CFPB filed suit against Prime Marketing Holdings, LLC, a credit repair company, for alleged violations of the CFPA in connection with the company’s marketing of credit repair services. The CFPB alleged that the company engaged in abusive and deceptive marketing practices by advertising that it could remove virtually any negative information from a consumer’s credit re- port. The CFPB also alleged that the company charged illegal upfront fees in connection with credit repair ser- vices, in violation of the Telemarketing Sales Rule. Looking Ahead to 2017 In 2017, we anticipate that accurate credit reporting and credit repair services will continue to remain in federal and state enforcers’ crosshairs. The CFPB is likely to continue pursuing enforcement actions against credit repair companies that falsely advertise that they can remove negative information from consumers’ credit reports, as the CFPB has taken the position that such advertising is subject to unfairness and misrepresenta- tion claims. We also anticipate that credit card compa- nies, banks, and other lenders will face scrutiny over their role in accurate credit reporting, and that the CRAs will be subject to additional state investigations regard- ing inaccurate credit reports and difficulties removing erroneous credit information from those reports. In addition, the Department of Education recently an- nounced an initiative to develop guidance for lenders about how student loans should appear on borrower’s credit reports. Lenders and other furnishers of credit information should watch for new guidance, and possi- ble enforcement activity, related to providing accurate information about student loans to the credit reporting agencies. What to Watch Continued focus on credit repair services | Increased scrutiny of lenders over accurate credit reporting | Potential increase in consumer litigation over illegal upfront fees and deceptive marketing | New focus on furnishing information about student loans to credit reporting agencies PAYDAY LENDING MORTGAGE CREDIT CARDS AUTO LOANS TELEPHONE CONSUMER PROTECTION ACT FEDERAL COURTS OF APPEALS CONSUMER FINANCIAL & PROTECTION BUREAU STUDENT LENDING DEBT COLLECTION DATA SECURITY