R.I. to receive $90K in settlement with three national credit reporting agencies

RHODE ISLAND and 30 other states reached a settlement with three national credit reporting agencies who have agreed to pay $6 million, of which the Ocean State would receive about $90,000, Attorney General Peter F. Kilmartin said.  / COURTESY R.I. ATTORNEY GENERAL'S OFFICE
RHODE ISLAND and 30 other states reached a settlement with three national credit reporting agencies who have agreed to pay $6 million, of which the Ocean State would receive about $90,000, Attorney General Peter F. Kilmartin said. / COURTESY R.I. ATTORNEY GENERAL'S OFFICE

PROVIDENCE – Rhode Island and 30 other states reached a settlement with three national credit reporting agencies who have agreed to pay $6 million, of which the Ocean State would receive about $90,000.
Attorney General Peter F. Kilmartin on Wednesday announced the settlement with the three credit reporting companies: Equifax Information Services LLC, Experian Information Solutions Inc. and TransUnion LLC.
The agreement stems from a multistate investigation that started in 2012, which focused on consumer disputes about credit report errors, monitoring and disciplining data furnishers, accuracy in consumer credit reports and improper marketing of credit monitoring products, according to a press release.
“With the increase in identity theft and credit fraud over the past several years, consumers demand and deserve greater input in the credit reporting process and need to have greater recourse to dispute erroneous or fraudulent information,” Kilmartin said in a statement.
On top of the $6 million, the credit reporting agencies have also agreed to increase third-party monitoring, require more information from third-parties pertaining to “certain types of data,” to limit direct-to-consumer marketing and provide greater protection for consumers who dispute credit reports, among other new protocols, according to the press release.
“This is a comprehensive settlement that provides significant protections for consumers nationwide,” Kilmartin said.
The agencies are slated to make the changes in three phases, but all must be in place within three years and three months following the settlement’s effective date, according to the release.
“The states negotiated for years to achieve these changes and the results of our efforts will put greater control in the hands of the consumers over this important piece of their financial lives,” Kilmartin said.
Other states participating in the settlement are Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Missouri, Nebraska, Nevada, New Mexico, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont and Wisconsin.
According to the release, key provisions of the settlement include:
Higher standards for data furnishers:

  • The credit reporting agencies must maintain information about problem data furnishers and provide a list of those furnishers to the states upon request.
  • The credit reporting agencies and data furnishers must use a better, more detailed system to share data.

Limits to direct-to-consumer marketing:

  • The credit reporting agencies cannot market credit monitoring services to a consumer during a dispute phone call until the dispute portion of the call has ended.
  • The credit reporting agencies must tell consumers that purchasing a product is not a requirement for disputing information on their credit reports.

Added protections for consumers who dispute credit reporting information:

  • The credit reporting agencies must implement an escalated process for handling complicated disputes, such as those involving identity theft, fraud or mixed files — where one consumer’s information is mixed with another’s.
  • Each credit reporting agency must notify the other agencies if it finds that one consumer’s information has been mixed with another’s.
  • The credit reporting agencies must send a consumer’s supporting documents to the data furnisher. (The credit reporting agencies implemented this change after the attorneys general initiated their investigation and raised the concern that the pertinent complaint documents were not being sent to the furnishers.)
  • Consumers may obtain one additional free credit report in a 12-month period if they dispute information on their credit report and a change is made as a result of the dispute.

Limits to certain information that can be added to a consumer’s credit report:

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  • The credit reporting agencies are generally prohibited from adding information about fines and tickets to credit reports.
  • The credit reporting agencies cannot place medical debt on a credit report until 180 days after the account is reported to the credit reporting agency, which gives consumers time to work out issues with their insurance companies.
  • The credit reporting agencies must require debt collectors to provide the original creditor’s name and information about the debt before the debt information can be added to a credit report.

Additional consumer education:

  • The credit reporting agencies must tell consumers how they can further dispute the outcome of an investigation into a dispute, such as by filing a complaint with other agencies.
  • Each credit reporting agency must provide a link to its online dispute website on the website www.annualcreditreport.com, and the credit reporting agency’s dispute website must be free of ads and any marketing offers.

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