CFPB Guidance Focuses on Credit Reporting and Reg F

The bureau released guidance to help clarify FCRA name-matching procedures for CRAs and to help consumers understand their Reg F rights.

2.5 minute read

Under the leadership of Director Rohit Chopra, the Consumer Financial Protection Bureau has issued an advisory opinion to ensure that consumer reporting agencies (CRAs) provide accurate data in consumer reports and, separately, a blog post intended to help consumers understand their rights under about Reg F.

Credit Reporting Accuracy and the FCRA

The bureau has issued an advisory opinion to clarify that CRAs, including those that provide employment and tenant screening reports, violate the Fair Credit Reporting Act when they use inadequate procedures to match information to consumers—and specifically when they use name-only matching (i.e., matching information to a particular consumer based solely on the consumer’s first and last names). The advisory opinion specifically applies to CRAs as defined in FCRA Section 603(f).

The opinion states: “[I]t has been the consistent view of the Bureau that name-only matching is not a procedure that assures maximum possible accuracy, and thus, consumer reporting agencies that use name-only matching violate FCRA section 607(b).”

In a press release, the bureau states that “[t]he advisory opinion affirms the obligations and requirements of consumer reporting companies, including background screeners, to use reasonable procedures to assure maximum possible accuracy.”

As noted in the press release, both the bureau and federal courts “have consistently found that the use of name-only matching procedures—when a consumer reporting company uses only first and last name to determine whether a particular item of information relates to a particular consumer, without using other personally identifying information such as address, date of birth, or Social Security number—does not assure maximum possible accuracy of consumer information.”

The bureau makes clear, however, that “[t]he advisory opinion does not create a safe harbor [for CRAs] to use insufficient matching procedures involving multiple identifiers. Other practices, for instance name combined with a date of birth, could also lead to cases of mistaken identity.”

While the advisory opinion provides FCRA guidance aimed at CRAs, it stands as an important reminder for all individuals and organizations involved in the credit-reporting process (including debt collectors that choose to furnish data to CRAs) that the bureau remains focused on ensuring the accuracy of credit reports.

ACA International recommends companies that furnish data review their policies and procedures on reporting accurate information.

For more resources, members can visit ACA’s online FCRA Compliance Center.

Reg F Reminders

Following the effective date of Reg F, the CFPB also issued a notice to consumers about understanding the debt collection rule.

The notice reviews the debt collection validation notice; how often a debt collector can call a consumer under Reg F; when a debt collector can report debt to a CRA; the permissibility of social media communication; and the limited content message.

We know ACA members frequently receive questions from consumers about these topics as well. They present an important opportunity to share the Know My Debt website with consumers, collectors and on your agency’s website.

By including links to vetted financial literacy resources on your website, you can help consumers find the critical information they may need in order to feel comfortable talking to your company representatives.

Developed by ACA’s Financial Literacy Committee, Know My Debt delivers clearly worded explanations to help consumers improve their financial literacy and resolve their debts.

Read more about the Know My Debt website’s features here: Leading the Way with Transparency and Education and visit ACA’s Reg F Resource Center for comprehensive resources on the debt collection rule.

ACA is also hosting a Hot Topic webinar, Collectors—What They Really Need to Know About Reg F, on Dec. 14.

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