(Jan. 14, 2022) A reminder to debt collectors of their obligations when collecting medical debts to comply with federal prohibitions on misrepresentations and unfair practices was issued Thursday by the CFPB.
The bureau said its Compliance Bulletin noted the Fair Debt Collection Practices Act’s (FDCPA) prohibition on misrepresentations and unfair practices, including when collecting medical debts covered by the No Surprises Act (NSA). The bulletin also reminds consumer reporting agencies and information furnishers to comply with the Fair Credit Reporting Act’s (FCRA) accuracy and dispute resolution requirements, including when furnishing information about or reporting medical debts covered by the NSA.
Enacted last year, the NSA is aimed at protecting people covered under group and individual health plans from facing surprise medical bills when they receive most emergency services, non-emergency services from out-of-network providers at in-network facilities and services from out-of-network air ambulance service providers, among others.
The bulletin advises credit bureaus that the accuracy and dispute obligations imposed by the FCRA apply with respect to debts stemming from charges that exceed the amount permitted by the NSA.
“The CFPB will investigate claims and take action against companies that attempt to collect or report or furnish consumer information about debts stemming from charges that exceed the amounts permitted under the NSA,” the bulletin states.
The bulletin also includes several other reminders to debt collectors, information furnishers and credit bureaus:
- Consumer financial protection law prohibits debt collectors from misrepresenting the character, amount, or legal status of any debt.
- Furnishers of information to debt collectors must have reasonable written policies and procedures regarding the accuracy and integrity of consumer information provided to credit bureaus.
- The accuracy and dispute obligations imposed by federal consumer financial protection law apply with respect to debts stemming from charges that exceed the amount permitted by the NSA.
LINK:
CFPB Issues Bulletin to Prevent Unlawful Medical Debt Collection and Credit Reporting
(Nov. 5, 2021) A consumer reporting agency that uses “name-only” matching procedures is not using reasonable procedures mandated under federal consumer protection laws, the CFPB said this week.
In an “advisory opinion,” the bureau said that matching information to a particular consumer who is the subject of a consumer report based solely on whether the consumer’s first and last names are identical or similar to the names associated with the information falls outside of the Fair Credit Reporting Act (FCRA). The agency termed the practice as “inadequate matching procedures to match information to consumers.”
CFPB said it issued the advisory opinion to remind consumer reporting agencies that their matching practices must comply with their FCRA obligation to ”follow reasonable procedures to assure maximum possible accuracy.”
The advisory opinion notes that consumer complaints CFPB has received – particularly about “incorrect information on your report” – reflect “significant consumer concern” about inaccuracies in consumer reports. Last year, the bureau said, companies provided responses to more than 191,000 such complaints, which represents approximately 68% of credit or consumer reporting complaints responded to by companies that year.14
“Name-only matching,” the bureau asserted, is particularly likely to lead to inaccuracies in consumer reports. “Name-only matching occurs when a consumer reporting agency 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,” CFPB said.
The opinion asserts that matching information to a consumer who is the subject of a consumer report by name alone creates “significant accuracy concerns” because most names are shared with other consumers and, in some cases, with thousands of other consumers. “In preparing consumer reports, it is not a reasonable procedure to assure maximum possible accuracy to use insufficient identifiers to match information to the consumer who is the subject of the report,” the agency opined.
LINK:
Fair Credit Reporting; Name-Only Matching Procedures
(April 2, 2021) Seven policy statements issued in 2020 from late March to early June that provided temporary flexibilities to financial institutions in the areas of consumer mortgages, credit reporting, credit cards, and prepaid cards are rescinded as of April 1 (Thursday), the Consumer Financial Protection Bureau (CFPB) announced this week.
The bureau also said it was rescinding its 2018 bulletin on supervisory communications and replacing it with a revised one describing its use of matters requiring attention (MRAs) “to effectively convey supervisory expectations.” That new bulletin, 2021-01, states that “effective immediately,” the bureau will no longer use “supervisory recommendations” in these communications.
“We are now over a year into the disruptive and deadly COVID-19 crisis. The virus has affected industry as well as consumers, but individuals and families have been hardest-hit by the pandemic’s health and economic impacts,” said CFPB Acting Director Dave Uejio. “Providing regulatory flexibility to companies should not come at the expense of consumers. Because many financial institutions have developed more robust remote capabilities and demonstrated improved operations, it is no longer prudent to maintain these flexibilities. The CFPB’s first priority, today and always, is protecting consumers from harm.”
The rescinded policy statements were issued between March 26 through June 3, 2020, and temporarily provided financial institutions with flexibilities regarding certain regulatory filings or compliance with consumer financial laws and regulations. The bureau said the rescissions “reflect the Bureau’s commitment to consumer protection, and the fact that financial institutions have had a year to adapt their operations to the difficulties posed by the pandemic.”
The bureau, in its release, included links to each policy statement rescission notice and the new MRA bulletin.
Rescission of Statement on Bureau Supervisory and Enforcement Response to COVID-19 Pandemic (March 26, 2020)
Rescission of Statement on Supervisory and Enforcement Practices Regarding Quarterly Reporting Under the Home Mortgage Disclosure Act (March 26, 2020