Last summer over 10,000 PIRG members submitted comments to the Consumer Financial Protection Bureau (CFPB) urging strict regulation of credit bureaus and credit scoring firms. We applaud the CFPB for its proposal today to subject the nation’s largest credit bureaus and credit scoring firms to full scrutiny as “larger participants” (CFPB pdf) in the financial marketplace.”
Iowa PIRG research has documented that up to one-quarter of credit reports contain serious errors. For far too long, the credit bureaus have acted as reckless gatekeepers to financial success – not only making too many mistakes that deny or raise the cost of credit – but making it nearly impossible for consumers to fix them. By subjecting the credit bureaus to full supervisory authority, CFPB examiners will be able to look inside the mysterious black box that credit reports and credit scores come from, fix the problems and help consumers get a fair deal in the marketplace.
In today’s proposal, the CFPB also has proposed full scrutiny of large debt collectors and debt buyers. These too are firms that for too long have held themselves above the law, including by seeking to collect debts that were either never owed (from victims of identity theft) or no longer owed (due to state statutes of limitations). Consumers should certainly pay their justified bills, but bill collectors should comply with the law.
When it completes this larger participants rule, the CFPB will gain tools that the FTC has never had to make both the front and back ends of the credit cycle fairer for consumers.
Senior Director, Federal Consumer Program, PIRG
Ed oversees U.S. PIRG’s federal consumer program, helping to lead national efforts to improve consumer credit reporting laws, identity theft protections, product safety regulations and more. Ed is co-founder and continuing leader of the coalition, Americans For Financial Reform, which fought for the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, including as its centerpiece the Consumer Financial Protection Bureau. He was awarded the Consumer Federation of America's Esther Peterson Consumer Service Award in 2006, Privacy International's Brandeis Award in 2003, and numerous annual "Top Lobbyist" awards from The Hill and other outlets. Ed lives in Virginia, and on weekends he enjoys biking with friends on the many local bicycle trails.