Virtual Hearing - Consumer Credit Reporting: Assessing Accuracy and Compliance (EventID=112712)

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Connect with the House Financial Services Committee Get the latest news: https://financialservices.house.gov/ Follow us on Facebook: https://www.facebook.com/HouseFinancialCmte Follow us on Twitter: https://twitter.com/FSCDems ___________________________________ On Wednesday, May 26, 2021, at 12:00 p.m. (ET) Oversight and Investigations Subcommittee Chairman Green and Ranking Member Barr will host a virtual hearing entitled, “Consumer Credit Reporting: Assessing Accuracy and Compliance." - - - - - - - - Witnesses for this one-panel hearing will be: • Ms. Beverly Anderson, President, Global Consumer Solutions, Equifax • Ms. Sandy Anderson, Senior Vice President, Strategy and Operations, Experian Credit Services • Mr. John Danaher, Executive Vice President, Consumer Interactive at TransUnion • Ms. Rebecca Kuehn, Partner, Hudson Cook • Ms. Chi Chi Wu, Staff Attorney, National Consumer Law Center (NCLC) Overview Creditors, data resellers, employers, insurers, law enforcement agencies, underwriters, utility providers, and others rely on consumer credit reports and scores. Consequently, consumer reporting agencies (CRAs) and the credit reporting system as a whole directly affect the lives of all Americans in lasting, life-altering ways. Yet, regulators warn that too many consumers suffer from incomplete or erroneous information on their credit reports and then find significant barriers when attempting to rectify such errors. At the same time that credit bureaus have monetized the credit files of consumers, there is a dearth of current or even recent data establishing the accuracy and reliability of the data sold by the CRAs. In response, jurisdictions such as California and the European Union have taken steps to empower consumers with more control over their data, with some observers calling for comprehensive reforms to make the system more consumer oriented. Other experts have urged the creation of a federal consumer credit reporting agency. Background The Fair Credit Reporting Act (FCRA) defines CRAs as “any person (who)… regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties.” Under §607(b) of FCRA, CRAs must have reasonable procedures in place to ensure the “maximum possible accuracy” of information contained in consumer files.7 While there are only three nationwide CRAs — Experian, Equifax, and TransUnion — other types of CRAs collect and sell consumers’ data, such as employment and tenant history. Some of these companies are referred to as nationwide specialty CRAs.8 CRAs receive information voluntarily supplied by “furnishers.” For the nationwide CRAs, these furnishers are generally creditors, debt servicers, and debt collectors. The CRAs then curate and maintain this information to create individual consumer reports and related product offerings that it sells to various users such as landlords, employers, lenders, utilities, and data resellers. FCRA and Regulation V provide the legal framework for the consumer credit reporting system, including limitations on how CRAs can disclose credit report information.9 FCRA has been amended by various statutes, including the Fair and Accurate Credit Transactions Act of 2003, the Dodd-Frank Wall Street Reform and Consumer Protection (Dodd-Frank) Act of 2010, and the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018. The Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) share FCRA jurisdiction.10 FCRA also creates a private right of action. §501(b) of the Gramm-LeachBliley Act, which mandates security and confidentiality safeguards for consumer records and information, as well as protects against unauthorized access or use of such records or information which could result in substantial harm or inconvenience to any customer. The FTC has authority to enforce §501(b) for CRAs, which it typically exercises after an incident occurs. Changes to Credit Reporting Requirements in the CARES Act The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted on March 27, 2020, amended FCRA and thereby altered the duties of furnishers (such as creditors, mortgage loan servicers, and credit card account servicers) when reporting on the status of accounts provided with COVID-19-related payment accommodations. Under the CARES Act, furnishers must report such an account as current if the account was current before the payment accommodation, assuming the consumer makes payments in accordance with their accommodation.14 The CARES Act also requires furnishers to report an account as delinquent if the account was delinquent before accommodation, except if the consumer brings the account current during the accommodation, at which point, the furnisher should report... Hearing page: https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=407752