Statement: CFPB sues Experian, alleging ‘sham investigations’

Lawsuit claims credit bureau failed to properly address consumer disputes

WASHINGTON — The Consumer Financial Protection Bureau (CFPB) announced on Tuesday a lawsuit against Experian, one of the three nationwide consumer reporting agencies, also known as credit bureaus. 

The CFPB’s allegations in its complaint include that Experian: 

• Failed to provide furnishers will all relevant information about disputes by sending “misleading, confusing, or inaccurate” dispute codes to furnishers of credit report data.
• Allowed inaccurate information to remain on credit reports by overrelying on furnishers’ responses, even when it possessed information to suggest that furnishers might be unreliable. For example, it received “responses with inconsistent information, such as indicating a consumer’s overdue balance is greater than the total amount due.”
• Failed to inform consumers of reinvestigation results. 
• Allowed mistakes to reappear on credit reports by “not prevent[ing] new furnishers from reinserting tradelines that Experian had deleted in response to a consumer dispute.”

As U.S. PIRG has reported, over the years, the problem that consumers have complained to the CFPB about the most is mistakes on credit reports. 

The CFPB says this lawsuit “seeks to stop the company’s unlawful conduct, to provide redress for harmed consumers, and the imposition of a civil money penalty, which would be paid into the CFPB’s victims relief fund.”

In response to the lawsuit, PIRG’s Consumer Campaign Director Mike Litt released the following statement:

“Consumers have long reported problems with mistakes on their credit reports. In fact, it’s been the most complained about issue to the CFPB for 11 years in a row. And as the CFPB notes, inaccurate credit reports can threaten people’s access to credit, employment, and housing.

“The CFPB has a long history of getting the credit bureaus to shape up, but it has required constant vigilance. Hopefully, this lawsuit will lead to more permanent changes — and less financial and emotional stress for Americans who don’t deserve it.”