WASHINGTON, D.C. — Intensifying its overseeing of credit
reports, the Consumer Financial Protection Bureau put operations that supply
information to consumer reporting companies on notice earlier this week.

The CFPB released a bulletin stressing that under the law
these companies — better known in the industry as furnishers — are responsible
for investigating consumer disputes forwarded by the consumer reporting
companies.

The agency said furnishers are also responsible for
reviewing all relevant information provided with the disputes, including
documents submitted by consumers.

"Credit reports play a critical role in the lives of
consumers," CFPB director Richard Cordray said. "Given the importance of these
reports, consumers need to know that their documents are being reviewed when
they dispute what they believe is a mistake on a report. Today's bulletin helps
ensure that the right people will be doing just that."

Cordray reiterated that consumers may file a dispute with a
consumer reporting company about an item on their credit report. If they do,
the consumer reporting company ordinarily must inform the furnisher that the
consumer has filed a dispute.

The agency pointed out the consumer reporting company is
also required to forward all relevant information it has about the dispute to
the furnisher. Once the furnisher receives the information, it must review it,
conduct an investigation and respond to the consumer reporting company.

An electronic system known as e-OSCAR is used by the three
largest nationwide consumer reporting companies — Equifax Information Services,
TransUnion, and Experian Information Solutions — to send information relating
to consumer disputes to furnishers.

In a December report, the CFPB highlighted the fact that the
e-OSCAR system did not provide a means for credit reporting companies to
forward to furnishers any documents submitted by consumers.

Since then, the CFPB said it has been working to ensure that
the dispute system was improved. Officials highlighted the e-OSCAR system has
been upgraded so that the three companies can now send furnishers any relevant
dispute documents mailed in by consumers.

"The CFPB is continuing to work to see that the capacity of
the system is expanded further in the near future," officials said.

The agency noted this bulletin details the bureau's
expectations of how furnishers should comply with the requirements of the Fair
Credit Reporting Act, particularly with respect to investigations of consumer
disputes they receive from consumer reporting companies.

The CFPB added the bulletin specifically addresses
furnishers' obligation to review all relevant dispute information provided by
the consumer reporting companies.

The CFPB expects each furnisher to fulfill its legal
obligations by:

—Receiving information and investigating disputes: When a
consumer files a dispute about a credit report item, companies need to be able
to receive information about the dispute and must investigate the consumer's
concerns.

—Providing investigation results: Furnishers must report the
results of the investigation to the consumer reporting company that sent the
dispute originally. 

—Correcting inaccurate information: Furnishers are required
to report the results of the investigation to nationwide consumer reporting
companies if those companies may have received inaccurate or incomplete credit
information. Furnishers also have to modify, delete, or permanently block
disputed information that is incomplete, inaccurate, or cannot be verified.

"If the CFPB determines that a furnisher has engaged in any
acts or practices that violate the Fair Credit Reporting Act or other federal
consumer financial laws, it will take appropriate supervisory and enforcement
actions to address violations and seek all appropriate corrective measures,
possibly including restitution to harmed consumers," officials said.

"The CFPB will continue to review furnishers' compliance
with these requirements," they added.

The complete bulletin is available here.

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