CFPB Consumer Credit Report Complaints Surge During COVID-19 Pandemic

Coronavirus News

Written By ESR News Blog Editor Thomas Ahearn

In July 2020, a record number of consumers filed complaints with the Consumer Financial Protection Bureau (CFPB) for the fifth consecutive month due to the Coronavirus (COVID-19) pandemic, led by a surge in credit report complaints, according to analysis by U.S. PIRG (Public Interest Research Group) and the Frontier Group.

While credit reports are usually one of the leading sources of complaints to the CFPB, the analysis found the total number of those complaints surged by 86 percent during the COVID-19 pandemic. As a percentage of overall complaints to the CFPB, they accounted for 65 percent in July 2020 compared to 54 percent in February 2020.

The number of complaints about incorrect information in credit reporting almost doubled, and nearly three out of four of these complaints claimed the information on a consumer’s credit report belonged to someone else. Complaints about delayed investigations into credit problems and unsuccessful investigations also spiked.

The analysis stated: “The accuracy of credit reports is important because consumer reporting agencies act as gatekeepers to financial or employment opportunities. Few creditors will issue credit without reviewing a credit report or credit score derived from it. Increasingly, employers, landlords, and insurers also now use credit reports.”

The analysis revealed that the total amount of consumer complaints to the CFPB – a government agency that empowers consumers to take more control over their economic lives – was up 50 percent since the national onset of the COVID-19 pandemic between March 2020 and July 2020 over the same five-month period in 2019.

“So many Americans don’t have the money to pay their bills as a result of the Coronavirus crisis, and it’s not their fault,” U.S. PIRG Senior Director for Federal Consumer Programs Ed Mierzwinski said in a news release. “A simple solution Congress can take immediately to ease that pain is to stop debt collection and negative credit reporting.”

The analysis also recommended that the CFPB rescind its COVID-19 pandemic guidance issued in June 2020 that allowed temporary and targeted flexibility for Consumer Reporting Agencies (CRAs) with regard to reinvestigation time limits for consumer disputes required by the federal Fair Credit Reporting Act (FCRA).

The CFPB is working to continuously update information for consumers during this rapidly evolving situation and will publish all COVID-19-related information and blogs to its resource page. To find more information regarding COVID-19 from CFPB, visit the COVID-19 resource page at https://www.consumerfinance.gov/coronavirus/.

Coronavirus (COVID-19) is a respiratory illness that can spread from person to person. As of August 19, 2020, there are more than 22.1 million global cases and 781,000 global deaths, while the United States leads the world with more than 5.4 million cases and 171,000 deaths, according to research from Johns Hopkins University.

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