Senate Holds Hearings On Credit Bureau Negligence

credit bureaus negligence heard by senate

On Wednesday, December 19, 2012 the Senate Committee on Banking, Housing and Urban Affairs held a hearing titled “Making Sense Of Consumer Credit Reports” to determine the state consumer credit reports and the credit bureaus.

The primary reason behind this hearing is likely the recent report released by the Consumer Financial Protection Bureau (CFPB) which we recently analyzed here. Giving testimony were officials from the CFPB, a representative from the Consumer Data Industry Association (CDIA) which represents more than 180 credit bureaus, and an attorney from the National Consumer Law Center.

The representative from the CFPB enumerated the findings detailed in their report at the hearing. As expected, the representative for the credit bureaus, spun a tale of of how good of a job that they were doing, and that they enjoyed an almost 95% customer satisfaction rating for how well they handled the voluminous amount of errors that they continue to report on consumer files.  Further, the representative placed all blame for any breakdowns in their system on the one group that continues to take on the fight of enforcing the rights of consumers, credit repair professionals.   While this response was expected, it further evidences the disdain that the bureaus have for the consumer, and to what levels they will go to try attack and place blame for their inadequacies on other parties.

Finally, the attorney from the National Consumer Law Center provided a more balanced and truthful state of the current situation:

  • Credit reports are plagued by inaccuracies such as mismatched data among individuals, errors caused by furnishers of information and the fallout from identity theft.
  • The nationwide consumer reporting agencies (CRAs) – Equifax, Experian, and TransUnion — are in gross violation of the FCRA’s requirements to conduct “reasonable” investigations when consumers dispute errors in their credit reports.  Wu called the dispute resolution system “a travesty of justice.”
  • The CFPB has the authority and ability to reform this system, and in the short time that it has existed it has taken significant steps and her organization has high hopes it will write regulations to implement provisions of the FCRA regarding accuracy and dispute resolution as it has supervision authority over the large participants in the credit reporting industry such as large banks.
  • Problems are not limited to the nationwide CRAs but extend to specialty consumer reporting agencies.

To read more on these hearings visit MortgageNewsDaily.

We wholeheartedly agree with Ms. Wu from the NCLC and her assessment of the true state of the credit bureaus and consumer credit reports.

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About Anthony Candella

Anthony is the founder and Directing Attorney of YourCreditAttorney.com and has been helping consumers just like you understand and improve your credit and financial situation since 2003.