Equifax to Settle CFPB Allegations of Inaccurate Credit Reports

Equifax has agreed to a settlement and consent order that will resolve Consumer Financial Protection Bureau (CFPB) allegations that the consumer reporting agency failed to take steps to ensure the accuracy of its credit reports.

Under the consent order, the company will bring its dispute resolution processes into compliance with federal law and pay a $15 million civil penalty to the CFPB’s victims relief fund, the regulator said in a Friday (Jan. 17) press release.

The CFPB found that Equifax violated the Fair Credit Report Act (FCRA) by failing to thoroughly investigate consumer disputes, putting previously deleted errors back on credit reports, failing to block information that resulted from identity theft, and sharing inaccurate credit scores and data about consumers to lenders, according to the release.

“Equifax failed in its basic duty to investigate and resolve consumer disputes about inaccurate information on their credit reports,” CFPB Director Rohit Chopra said in the release. “Today’s order requires Equifax to pay a civil penalty and follow federal laws on handling credit reporting disputes.”

Reached by PYMNTS, an Equifax spokesperson provided an emailed statement saying that the company publicly disclosed the CFPB investigation in 2022, engaged with the regulator to address its concerns even before the investigation began, and will continue to invest in its data quality capabilities, technology and processes.

“Over the last few years, we have become a New Equifax, investing over $1.5 billion in a complete technology transformation that has changed nearly every facet of our infrastructure,” the statement said. “We entered into this transformation with a goal of enhancing our data quality and accuracy and have been guided by our commitment to support consumers.”

Equifax now publishes a monthly consumer credit report accuracy metric on its website, and the company plans to introduce a mobile app in the second quarter that will give consumers additional credit visibility, according to the statement.

The CFPB said Jan. 7 that it sued Experian, alleging that the company failed to properly investigate consumer disputes and included incorrect information on credit reports.

In a separate case, on Thursday (Jan. 16), the CFPB filed an amicus brief in a case involving TransUnion that the regulator said aims to ensure that credit reporting companies are held accountable for “junk data” and don’t secure “loopholes” in the law that prevent that accountability.