A new analysis by the Consumer Financial Protection Bureau (CFPB) reveals how changes in complaint responses provided by nationwide consumer reporting companies resulted in fewer meaningful responses and less consumer relief. In 2021, Equifax, Experian, and TransUnion together reported relief in response to less than 2% of covered complaints, down from nearly 25% of covered complaints in 2019.

“America’s credit reporting oligopoly has little incentive to treat consumers fairly when their credit reports have errors,” said CFPB Director Rohit Chopra. “Today’s report is further evidence of the serious harms stemming from their faulty financial surveillance business model.”

Credit reporting plays a critical role in consumers’ lives and has an enormous reach beyond consumer financial services. More than 200 million Americans have credit files, and lenders rely on this information to decide whether to approve loans and on what terms. Consumer reporting also informs decisions about employment, insurance, housing, and even essential utilities. For consumers, inaccuracies on credit reports drive up the cost of credit and severely limit opportunities, such as starting a small business or buying a new home.

Consumers submitted more than 700,000 complaints to the CFPB regarding Equifax, Experian and TransUnion from January 2020 through September 2021, which represented more than 50% of all complaints received by the agency for that period. Consumers submit more complaints about inaccurate information on their credit and consumer reports than about any other problem. Consumers most frequently assert that the inaccurate information belongs to someone else, and consumers often describe being victims of identity theft.

The CFPB found the three companies often failed to provide substantive responses, especially when they alleged the complaints were sent in by third parties. However, consumers can authorize third-party representatives to submit complaints on their behalf.

Equifax, Experian, and TransUnion Fail to Meet Statutory Obligations

The Fair Credit Reporting Act (FCRA) requires Equifax, Experian, and TransUnion to conduct a review of complaints sent to them through the CFPB where consumers allege there is incomplete or inaccurate information in their consumer reports and the consumer appears to have previously attempted to fix the problem with the company. The companies must then report their determinations and actions for these covered complaints to the CFPB. Today’s report shows:

• Equifax most often promised to open investigations and send the results to the consumers at later dates, but it would fail to provide the CFPB with the outcomes of the investigations.
• TransUnion made similar promises and frequently failed to provide the outcomes of investigations to the CFPB. It often stated it would take no action on complaints because it believed the complaints were submitted by third parties.
• For many complaints, Experian frequently stated it would take no action because it believed the complaints were submitted by third parties, however, it did respond to the remaining complaints with substantive responses.

Medical Debt Mistakes

One of the main sources of consumer debt that can lead to consumer reporting inaccuracies and mistakes is medical bills. Consumers find that opaque pricing, the complex system of insurance coverage, and frequent delays in consumers finally receiving bills create an unnavigable quagmire and can make it harder to resolve billing errors. Accordingly, the CFPB’s previous research shows consumers often struggle to even determine whether the debt belongs to them, and, if it does, whether the amount is accurate .

Medical billing is just one example, but it highlights the ease with which errors, mistakes, and inaccuracies can occur, along with the financial consequences that follow.

Key Findings

Overall, consumers describe a consumer reporting system that is not working for them and the serious consequences that follow when inaccurate information is—and remains—on their consumer reports. Other key findings from today’s report include:

• Equifax, Experian, and TransUnion relied heavily on template complaint responses instead of providing meaningful and thorough responses to consumers, despite having up to 60 calendar days to respond.
• Beginning in early 2020, Experian and TransUnion stopped providing substantive responses to consumers’ complaints if they suspected that a third-party was involved in submitting a complaint.
• In many instances, Equifax and TransUnion promised to investigate but failed to provide the outcomes of their investigations to the CFPB and instead stated that they would forward the complaints to their “dispute channel.”

Federal law requires Equifax, Experian, and TransUnion to conduct a review of certain complaints sent to them by the CFPB to determine whether all of their legal obligations have been met with respect to the subject matter of the complaint and then to report their determinations and actions to the CFPB. However, more than 50% of these complaints did not receive this review, based in part on their suspicions that the complaints were submitted by third parties. As a result, many consumers did not receive meaningful responses to complaints submitted through the CFPB complaint process. Overall, consumers describe feeling frustrated and stressed when the nationwide consumer reporting companies’ automated processes for correcting inaccuracies do not work or when they do not get responses to their concerns. Consumers report that they spend time, energy, and money to try to correct inaccuracies.

Read the Annual report of credit and consumer reporting complaints.

To learn more about the complaint process, access the CFPB consumer complaint webpage.

Consumers having an issue with a consumer financial product or service can submit a complaint with the CFPB online or by calling (855) 411-CFPB (2372).