b'suffered no harm and had no standing to seek damages.security and monitoring services, and would in some The decision, and several important takeaways thatcircumstances add relatives or other persons with better emerge from the opinion for companies that face suitscredit as a co-signer on the account without permission. under all varieties of consumer statutes, is discussed inIf the customer later defaulted, Vivint then referred the more detail below. third-party co-signer to its debt buyer. The $25 million monetary judgment obtained by the FTC is the largest CFPB, FTC, and State of North Carolina File Amicusmonetary judgment to date for an FTC FCRA case.Brief in Henderson v. The Source for Public Data, L.P.In October, the CFPB, FTC, and state of North Carolina filed an amicus brief in support of the plaintiffs inLooking Ahead to 2022Henderson v. The Source for Public Data, L.P., a case onEven before his appointment to lead the CFPB, then-FTC appeal to the Fourth Circuit. The defendantthe SourceCommissioner Chopras public statements focused for Public Datacompiles publicly-available informationon the importance of the credit reporting industry and on consumers and sells the information to its customers.perceived consumer vulnerability. For example, in one In Henderson, the district court held that 47 U.S.C.230public statement Commissioner Chopra said that CRAs, of the Communication and Decency Act, which protectsnot just debt collectors, have a responsibility to correct interactive computer service providers from liability as adebt parking. He went on to say that [t]he CFPB can publisher of third-party information, barred the plaintiffsaddress this problem by using its authority to stop FCRA claims arising from the furnishing of reports thatwhat he called unfair, deceptive, and abusive practices contained false or inaccurate information. In announcingby credit reporting agencies. In testimony to the U.S. the filing of their amicus brief, Director Chopra and FTCHouse Financial Services Committee given shortly after Chair Khan said that the case highlights a dangeroushis confirmation Director Chopra expressed concern that argument that could be used by market participants toconsumers lack the leverage to get problems fixed in sidestep laws expressly designed to cover them, and thatmarkets like credit reporting because they are not the tech companies . . . will need to follow the same laws thatcustomer. Taken in context with the trends noted above, apply to other market participants. The Eleventh Circuitthe early indications are that fair credit reporting will be has yet to issue a decision on the appeal. among the priority of a Director Chopra-led CFPB. CFPB Files Lawsuit Against Credit Repair Cloud and ItsLikely developments in 2022 may include both legislation CEO Over Software Used by Credit Repair Companies and regulation to remedy perceived inequity stemming In September, the CFPB filed a lawsuit against Creditfrom inaccurate credit reporting. Director Chopras Repair Cloud (CRC) and its CEO Daniel Rosen in the U.S.emphasis on consumers lack of bargaining power may District Court for the Central District of California allegingdrive further enforcement actions targeting non-financial that they had violated the Telemarketing Sales Rule andservices companies or targeting ancillary supporting CFPA by providing substantial assistance or support toconduct (such as the software company facilitating illegal credit repair companies that charged illegal advance feescredit repair fees). to consumers. The complaint alleges that in its marketing materials CRC encouraged the users of its softwareWhile the Biden administration has signaled an interest services to charge consumers at enrollment, with monthlyin creating a publicly-run credit reporting agency within fees thereafter, and that its software integrates with athe CFPB, the Biden administration has not adopted billing platform that allows users to charge up-front andthat proposal as an administration priority, nor has the recurring fees. The CFPB further alleges that CRC wereproposal gained traction among members of Congress. aware that its users were violating the TSR and CFPA inWith the looming midterms, we do not expect to see any charging consumers up-front fees before services weresignificant movement on this issue in the coming year rendered. The Bureau seeks an injunction, equitable relief,despite Director Chopras concern about unfair, deceptive, civil money penalties, and enforcement costs.and abuse practices engaged in by CRAs. FTC Reaches $25 Million Settlement With SmartWhat to WatchHome Monitoring Company Over Alleged Misuse of Credit Reports Increased enforcement activity by CFPB in credit In April, the FTC reached a settlement with Vivint, a Utah- reporting space, including against CRAs and based home security company, resolving allegations thatnon-financial services companies; andthe company had violated the FCRA, FTC Act, and FTCs Red Flags Rule. The settlement resolves a complaintGuidance or other regulatory action designed to simultaneously filed by the U.S. Department of Justice inensure credit reporting accuracy, particularly in the U.S. District Court for the District of Utah, alleging thatminority communities. Vivints sales representatives would use credit reports associated with similarly-named consumers in order to qualify prospective customers for the companys home 43'