A Texas-based debt collection agency
The FTC's
The FTC also alleges that Credit Protection Association did not have a policy requiring notice to consumers of the outcomes of investigations about disputed information and that in numerous instances consumers were not informed whether information they disputed had been corrected.
"When consumers dispute potentially incorrect information in their credit reports, companies must not only investigate those disputes, but also let consumers know whether the information has been corrected. Otherwise, consumers may be unaware of additional steps they may need to take under the FCRA, including filing dispute statements directly with credit reporting agencies," said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. "Companies that fail to live up to these obligations can expect to hear from the FTC."
In its complaint, the FTC alleges that while Credit Protection Association did have written policies regarding how disputes were handled, employees were not adequately trained on those policies, and the policies themselves failed to address the Furnisher Rule’s requirements.
The complaint notes that in many cases Credit Protection Association failed to keep copies of documentation from consumers that disputed the information Credit Protection Association had provided to reporting agencies.
The complaint also alleges that Credit Protection Association often relied on its clients – the original debt holders – to investigate credit reporting disputes, but its processes for transmitting consumers' dispute information to its clients were inconsistent. The complaint also alleges that the company had no meaningful way to audit or analyze how it handled consumer disputes.
Under the terms of the settlement, Credit Protection Association will be required to pay $72,000 in civil penalties, and will also be required to put in place policies and procedures that comply with the requirements of the FCRA and the Furnisher Rule. The company also will be required to follow the requirements related to conducting dispute investigations and informing consumers of their outcome.