Credit Reporting Agency Investigations

QUESTION

We received a notice from Transunion that our reported information is being disputed by the consumer. Transunion has contacted us to obtain information about the disputed reference. But we are not sure what steps Transunion is taking in its investigation. What are the procedures Transunion follows if a consumer disputes the information? What are the procedures we should be following in response to Transunion’s investigation?

ANSWER

Transunion is one of several consumer reporting agencies (“CRA”). If you furnished information about a consumer to a CRA and the consumer disputes the accuracy or integrity of the information contained therein, the following procedures should be followed in response to the CRA’s investigation.

1. Conduct an investigation with respect to the disputed information;
2. Review all relevant information provided by the CRA;
3. Report the results of the investigation to the CRA;
4.  If the investigation finds that the information is incomplete or inaccurate, report the results to all other CRAs to which you furnished the information and that compile and maintain files on consumers on a nationwide basis; and
5. If an item of information disputed by the consumer is found to be inaccurate or incomplete or cannot be verified after any reinvestigation, for purposes of reporting to a CRA only, as appropriate, promptly:

a.       Modify the item of information;

b.       Delete the item of information; or

c.       Permanently block the reporting of the item of information. [15 USC § 1681s-2(b)(1)]

It is important to note that there is a timeline requirement. You must complete the required investigations, reviews, and reports before the expiration of the time period applicable for the CRA to complete actions required under the Fair Credit Reporting Act (FCRA) with respect to the information. [15 USC § 1681s-2(b)(2)]

This process is called a “reinvestigation” and the timeline is incumbent on the CRA, which conducts it free of charge, in order to determine whether the disputed information is inaccurate and records the current status of the disputed information, or deletes the item from the file, before the end of a 30-day period beginning on the date on which the CRA receives the notice of the dispute from the consumer or reseller.

As to extensions to the reinvestigation timeline, the 30-day period may be extended for not more than 15 additional days if the CRA receives information from the consumer during the 30-day period that is relevant to the reinvestigation, except this would not apply where, during the 30-day period, any reinvestigation of the information is found to be inaccurate or incomplete or the CRA determines that the information cannot be verified. [15 USC § 1681i (a)(1); 15 USC § 1681i(a)(2); FCRA § 611(a)(1)]

I strongly recommend that you have policies and procedures in place that set forth your obligations regarding how best to respond to a CRA investigation regarding a consumer dispute of information contained in the credit report. If you need assistance, please let us know.

Jonathan Foxx

Managing Director