The Fair Credit Reporting Act (“FCRA”), is the federal statute that was enacted to promote accuracy, fairness, and privacy of consumer information contained in the files of credit reporting agencies. The purpose of this law is to protect consumers from the willful and/or negligent inclusion of inaccurate information in credit reports. With this purpose in mind, the law regulates gathering, dissemination, and use of information by the credit reporting agencies and furnishers to ensure the accuracy of consumer information.
Why These Changes are Occurring
In an effort to adhere to the letter of the law, the three big credit reporting agencies, Equifax, Experian and Trans Union are working to make changes so that they can improve the accuracy of consumer information and allow consumers easier access to dispute inaccuracies with the credit bureaus. The motivation behind these changes dates back to 2015 when government agencies discovered the agencies were not complying with the letter of the law and the number of consumers with inaccurate information on their reports was immeasurable.
Issue of Quality Control
This year alone, it is reported that just under 200,000 consumers have launched disputes with the credit reporting agencies regarding inaccurate information on their credit reports. This number is astounding. To improve upon the large amount of inaccuracies, the credit reporting agencies will first need to establish better quality control programs. In other words, credit reporting agencies will need to hire more employees to conduct investigations in greater detail so that the results will be more accurate.
Consideration of Supporting Documents
Under the FCRA, consumers are encouraged to send supporting documentation with their disputes, however consumer experts argue that the credit reporting agencies do not consider the information. Under new compliance procedures, agencies must consider the information when conducting a dispute and will have to put new procedures in place to prove that the information is being considered.
Information Furnishers Must Also Comply
Not only are the credit reporting agencies required to comply with the law but so are the furnishers of information. More often consumers are finding that furnishers are supplying inaccurate account information to the credit reporting agencies. To comply with the law, furnishers will be required to delve deeper into requests for investigation and to review information prior to reporting it.
In an effort to keep the credit reporting agencies and furnishers of information in compliance with the FCRA, authorities are giving them until March of 2018 to implement improvements. If you believe your rights have been violated under the FCRA and would like the advice or assistance of counsel, contact SmithMarco P.C. for a completely free case review.