[author: John L. Culhane, Jr.]

The CFPB has issued a bulletin to nationwide specialty reporting agencies to remind them of their obligation under the Fair Credit Reporting Act to establish a streamlined process for requests from consumers for free annual credit reports. These specialty companies typically collect and provide specific types of information on consumers, such as information on a consumer’s history with regard to check-writing, medical payments, tenancy, insurance claims or employment.

To satisfy the FCRA, nationwide specialty credit reporting companies must allow consumers to request credit reports through a toll-free number that must appear in every telephone directory that lists the company’s name and on any website the company owns or maintains that is related to consumer reporting. In addition to issuing the bulletin, the CFPB has sent warning letters to several companies it found not to be complying with the toll-free number requirement. The letters were also sent to several companies who had toll-free numbers but were not adequately dealing with consumer requests for reports due to inadequate capacity to handle the anticipated volume of requests or a failure to provide clear information and instructions to consumers about requests.

According to the CFPB’s press release, the warning letters stemmed from the CFPB’s review of phone listings and websites for nationwide specialty consumer reporting agencies across the country and attempts to request reports.

This past July, the CFPB issued its final rule defining what constitutes a “larger participant” in the consumer reporting market and, on September 30, began examining qualifying entities for compliance with federal consumer financial laws. The issue identified by the CFPB in the bulletin is one of the many compliance issues that consumer reporting agencies should review before they are faced with a CFPB exam. Our Consumer Financial Services Group has created a team of lawyers who have already conducted compliance reviews for many non-bank entities in anticipation of their first CFPB exams.