CFPB WANTS TO SUPERVISE CREDIT REPORTING AGENCIES AND DEBT COLLECTORS
Credit reporting agencies and debt collection agencies have been unsupervised for too long, according to CFPB Director, Richard Cordray. David Lazarus, of the LA Times, reported. The new consumer protection rules proposed by the Consumer Financial Protection Bureau will give the federal government oversight of the credit reporting agencies and debt collection companies in an effort to level the playing field with consumers.
For example, debt collector West Bay Acquisitions is attempting to collect on alleged past due accounts from Hollywood Video and Movie Gallery customers. Customers being dunned are questioning the validity of the debts, but the video rental stores no longer exist. Other than the civil consumer protection statutes, such as the Fair Debt Collection Practices Act, debt collectors are not regulated by the federal government. Regulatory authority over debt collectors has been relegated to the states.
“Debt collectors and credit reporting agencies have gone unsupervised by the federal government for too long,” Richard Cordray, director of the agency, told Lazarus.
“Unlike most services or products where consumers can shop around among different providers, consumers can’t do that with these businesses,” Cordray said. “Consumers don’t get to choose their debt collector, and they don’t get to choose whether to have the consumer credit reporting agencies keep track of their credit history.”
Debt collectors are not the only businesses on the CFPB’s radar. According to Director Cordray, “consumer reporting agencies, such as Experian, Equifax and TransUnion, represent a ‘murky unknown’ for most people.” The nationwide consumer reporting agencies maintain over 200 million credit report files on American consumers.
The CFPB has proposed to supervise credit reporting companies that receive more than $7 million a year from their consumer business. The 30 consumer reporting agencies companies that fall into this category account for about 94% of the market, according to Lazarus.
As for the consumers being dunned by West bay for the Hollywood Videos and Movie Gallery alleged debts, send a letter to the company disputing the charge and declaring that no money is actually owed. West Bay’s address is P.O. Box 8009, Cranston, RI 02920.
We represents consumers who are being harassed by debt collectors and consumers with credit report issues. Under the Fair Debt Collection Practices Act and the Fair Credit Reporting Act, consumers have rights under federal law. Contact our consumer protection attorneys for a free case review at 1-800-263-9091 24/7, or by using the online contact form below.