CFPB fines credit bureaus Equifax and Transunion for misleading consumers and other improper activity (1 Viewer)

[superchuck500]

Shocker! The credit bureaus do shady things? Go figure.

In personal finance, practically everything can turn on one’s credit score. It’s both an indicator of one’s financial past, and the key to accessing necessities—without insane costs—in the future. But on Tuesday, the Consumer Financial Protection Bureau announced that two of the three major credit-rating agencies responsible for doling out those scores—Equifax and Transunion—have been deceiving and taking advantage of Americans. The Bureau ordered the agencies to pay more than $23 million in fines and restitution.

In their investigation, the Bureau found that the two agencies had been misrepresenting the scores provided to consumers, telling them that the score reports they received were the same reports that lenders and businesses received, when, in fact, they were not. The investigation also found problems with the way the agencies advertised their products, using promotions that suggested that their credit reports were either free or cost only $1. According to the CFPB the agencies did not properly disclose that after a trial of seven to 30 days, individuals would be enrolled in a full-price subscription, which could total $16 or more per month. The Bureau also found Equifax to be in violation of the Fair Credit Reporting Act, which states that the agencies must provide one free report every 12 months made available at a central site. Before viewing their free report, consumers were forced to view advertisements for Equifax, which is prohibited by law.

That these credit agencies would abuse their power to mislead Americans attempting to take a more active role in monitoring their financial health is not only a violation of trust, it is dangerous.

More at https://www.theatlantic.com/business/archive/2017/01/credit-scores-cfpb/512162/



And as an aside, the CFPB was also the agency that brought the hammer down on Wells Fargo for its account sales (and fraudulent accounts) practices. Note that some (look to the right if you want to know who) want to get rid of the CFPB.

 

[staphory]

See what over regulation makes some companies do?

 

[Taurus]

See what over regulation makes some companies do?

Well played.

 

[PayOrPlay]

Note that some (look to the right if you want to know who) want to get rid of the CFPB.

Upcoming: yet another example of how elections have consequences. THE CFPB was conceived as an independent agency, but in October 2016, a split decision by the DC Circuit Court of Appeals effectively converted it into an executive branch office, ruling that the agency head can be fired at will by the President. Meanwhile there's been a barrage of criticism from the expected corners about the management of the agency. So what happens next? How many more enforcement actions like this one can we expect to see?

Trump administration could upend post-crisis financial reforms, weaken CFPB - LA Times

What will happen to the CFPB under Trump?

CFPB on Collision Course with Trump's Justice Department | American Banker