Nevada Attorney General Aaron Ford joined the attorneys general of 21 other states and the District of Columbia to urge the Consumer Financial Protection Bureau to enforce the Coronavirus Aid, Relief, and Economic Security Act and require credit reporting agencies to follow the Fair Credit Reporting Act during the COVID-19 crisis.
The CFPB’s recent announcement that it would not enforce the law would leave consumers at the mercy of unresponsive credit agencies at a critical time, the attorneys general said.
“Businesses are closed and tens of thousands of Nevadans have filed for unemployment,” Ford said. “To best position our state for economic recovery, Nevadans must have immediate access to their credit reports and be protected from fraud. We are counting on the Consumer Financial Protection Bureau to do its job to protect consumers.”
The letter, on the stationery of Pennsylvania Attorney General Josh Shapiro, was written in response to an announcement by the CFPB that it would not enforce an amendment to the Fair Credit Reporting Act that requires lenders to report as current any loans that are affected by a COVID-19-related accommodation. Additionally, the CFPB announced that it would not take action against consumer reporting agencies that violate the FCRA’s 30-day deadline to investigate consumer disputes.
In their letter, the attorneys general outlined their opposition to the Consumer Financial Protection Bureau’s announcement in three major points:
First, the CFPB’s announcement that it will not enforce the CARES Act’s requirements could discourage consumers from taking advantage of the accommodations that lenders are required to offer under the CARES Act or those that they are offering voluntarily.
Second, the CFPB’s announcement it will not require consumer reporting agencies to investigate consumer disputes within 30 days puts consumers at risk.
Third, consumer reporting agencies must be vigilant about accurately reporting consumer credit, which can only be done by following the requirements established by the FCRA as amended by the CARES Act.
The April 13 letter to Kathy Kraninger, the director of the CFPB, noted the COVID-19 global pandemic is causing significant economic disruption, with businesses closing and millions of workers filing for unemployment insurance.
“If we hope to have a quick economic recovery when this crisis is over, American consumers must be fully equipped to re-enter the market,” the attorneys general wrote. “The status of Americans’ credit reports will be vital to ensuring strong participation in the economy. The importance of protecting consumers’ credit is even greater during this crisis.”
The letter closed by telling Kraninger that the states will continue to do their part to protect the health and financial security of citizens regardless of what the federal government does.
“Consumers and (credit reporting agencies) should know that even if CFPB refuses to act, our states will continue to defend our consumers and families throughout this crisis,” the attorneys general wrote. “We will not hesitate to enforce the FCRA’s deadlines against companies that fail to comply with the law.
“The CFPB should get back to doing its job by immediately withdrawing its recent guidance and resuming vigorous oversight of consumer reporting agencies and enforcement of the FCRA.
In addition to Nevada, other states participating in this letter include California, Colorado, Hawaii, Iowa, Illinois, Massachusetts, Maine, Michigan, Minnesota, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington and Wisconsin, and Puerto Rico.