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During this week’s Research Assistant Peer Group meeting, a few members reported receiving concerning communications from Credit Reporting Agencies (CRAs). One member received a notification from Equifax and another from Experian, both conveying a similar message. The agencies were informed that they would no longer be allowed to furnish data to the CRA, stating that they were not happy with their dispute investigations. The other CRA stated a large percentage of disputed accounts have been corrected by them and the furnisher is required to furnish accurate and reliable data which they feel they were not doing.
Both have been reporting for many years, both report many accounts accurately. In an attempt to address the issue, they reached out to the CRAs for clarification and to understand what led to this decision. Unfortunately, they have not received any responses or further communication.
During the discussion, members speculated on whether the issue might be related to “mass cancellations.” Some wondered if accounts were being mass-canceled when they were closed and returned to creditors, or when the statute of limitations on debts expired, leading to discontinuation of collections. It was suggested that regular mass cancellations might trigger suspicion from the CRAs, potentially flagging the data furnisher as failing to investigate disputes and simply removing trades for convenience. However, this remains speculation, as the CRAs have not provided any details.
The conversation also touched on the tools used to streamline the investigation process. Some members expressed concern that these tools might appear overly automated, especially in the context of E-Oscar disputes. Additionally, there was a question about whether the type of debt being reported could be a factor. Most members report a wide range of debt types.
Our member who received the notice from Experian mentioned she reviewed her last metric report and has a fatal error report of 0.16, which is extremely good, making it even more difficult to understand why the CRA would make this decision.
How might you avoid receiving a similar notice from a CRA?
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- Monitor Mass Deletions: If you’re frequently deleting accounts in bulk, ensure none are related to recent disputes that may not have been properly investigated. Regardless of the reason for mass deletion or how accounts are selected, it’s crucial to address and respond to any disputes before deleting a trade.
- Audit Your Metrics: Regularly review metrics such as dispute rates or error reports. Break down the data by debt type or specific clients that frequently require deletion. These audits can help identify potential issues early, allowing you to address them before a CRA sends a notice.
- Maintain Records and Show Due Diligence: The examples discussed by our members suggest that CRAs often issue notices due to disputes. By conducting regular audits and maintaining historical records of your efforts to prevent consumer harm, you may be better positioned to respond effectively if you find yourself in this situation.
If you have received a similar communication from a CRA or have found a resolution, please share your experiences with our Research Assistant Group. We would greatly appreciate any insights on how to address and resolve this issue.
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