Warner, Warren urge action on consumer credit reporting

U.S. Sens. Mark R. Warner (D-Va.) and Elizabeth Warren (D-Mass.) on Friday sent a letter to the heads of the Consumer Financial Protection Board and the Federal Trade Commission urging them to take action to improve consumer credit reporting.

Recent CFPB and FTC reports found that 20 percent of consumers could identify at least one error in a credit report issued by one of the three major credit reporting agencies and that more than five percent of consumers found significant errors.  These mistakes could force consumers to pay more for insurance and loans, and could impact their access to security clearance.

“People can lose their jobs because of this information, and have their families thrown into chaos,” the senators wrote to CFPB Director Richard Cordray and FTC Chairman Jon Leibowitz. “They can be denied credit for purchasing automobiles necessary to commute to and from work. They can fail to receive mortgages, or be turned down for apartments. All of these impacts can throw families into deteriorating financial situations that spiral out of control.”

Sens. Warner and Warren have asked Director Cordray and Chairman Leibowitz to produce a report determining  whether additional oversight or legislation is needed to improve credit reporting. The Senators also urged Cordray and Leibowitz to examine the cumbersome process for disputing errors on consumer credit reports.

“The significant impact of consumer credit scores on the general public is not, in our minds, matched by the degree of transparency and responsiveness of the consumer credit reporting system to meet consumer need,” the senators wrote. “Our nation remains in a critical period of economic recovery, and tens of millions of Americans are emerging from problematic mortgages and other debts that have become more burdensome since the financial crisis began. We find this this situation unacceptable.”

Sens. Warner and Warren expect to work with Sen. Sherrod Brown (D-Ohio), who led a subcommittee hearing on the topic in 2012, as well as Banking Committee Chairman Chairman Tim Johnson (D-S.D.) and Ranking Member Mike Crapo (R-Wyo.), to move forward on these issues.