Alert September 17, 2013

CFPB Issues Guidance Bulletin on Furnisher’s Duty to Investigate

The CFPB issuedguidance bulletin setting forth its expectations for how companies that supply information for credit reports, commonly referred to as furnishers, should comply with the requirements of the Fair Credit Reporting Act in handling investigations of consumer disputes. FCRA requires consumer reporting agencies to notify and provide all relevant information to a furnisher when a consumer disputes the accuracy or completeness of information provided by the furnisher to the CRA. The furnisher is then required to conduct an investigation, including a review of "all relevant information" provided by the CRA. Of particular concern to the CFPB are furnishers’ obligations to review all relevant dispute information provided by the CRAs. The bulletin advises that the CFPB expects each furnisher to comply with FCRA by: (1) maintaining a system reasonably capable of receiving consumer dispute information from CRAs, including supporting documentation; (2) conducting an investigation of the disputed information including reviewing "all relevant information" forwarded by the CRA and the furnisher’s own information with respect to the dispute; (3) reporting the results of the investigation to the CRA that sent the dispute; (4) providing corrected information to every nationwide CRA that received the information, if the information is inaccurate or incomplete; and (5) modifying or deleting the disputed information, or permanently blocking the reporting of the information, if the information is incomplete, inaccurate, or cannot be verified. The bulletin notes that the CFPB will "prioritize examinations" on the basis of risks posed to consumers and will take any necessary supervisory and enforcement actions to address violations of FCRA.