Considerations for the nationwide consumer reporting companies to improve compliance with consumer financial protection laws and, ostensibly, to serve consumers better, is the asserted aim of annual report issued Tuesday by the federal consumer financial protection agency.
The report, according to the Consumer Financial Protection Bureau (CFPB), details “improvements and deficiencies” in the responses of consumer reporting companies TransUnion, Experian, and Equifax to consumer complaints conveyed to the agency.
The bureau said the report (mandated by the Fair Credit Reporting Act, or FCRA) is based on 488,000 consumer complaints transmitted by the CFPB to Equifax, Experian, and TransUnion from October 2021 through September 2022.
The findings, the agency said, follow the 2021 annual report which detailed failures by the nationwide companies when responding to consumer complaints submitted to the CFPB. “Equifax, Experian, and TransUnion have since acted to remedy some of the issues identified in last year’s report,” the CFPB said.
Among the actions taken, according to the CFPB, by the reporting companies include:
- Changed how they respond to complaints, decreasing the alleged problematic response types described in the 2021 report, with most complaints now receiving more substantive responses.
- Provided more tailored complaint responses, which now reportedly describe the outcomes of consumers’ complaints. In September 2022, the nationwide companies provided a tailored response to more than 50% of complaints that were closed with an explanation or relief, the CFPB said.
- Reported greater rates of relief in response to complaints, with TransUnion providing relief in most complaints. The CFPB said Experian reported providing relief in nearly half of complaints. However, Equifax reported that it did not provide relief, but its written complaint responses suggest that its rates of relief are comparable to the other two companies, the CFPB said.
Nevertheless, the CFPB said it had further recommendations for the firms, including:
- Consider consumer burden when implementing automated processes.
- Recognize that technology is also improving for consumers.
- Consider how to transition the market from control and surveillance to consumer participation.