Lincoln, NE — Attorney General Doug Peterson and 30 other state attorneys general today announced a major settlement with the three national credit reporting agencies — Equifax Information Services LLC, Experian Information Solutions Inc., and TransUnion LLC.
Under the settlement, the credit reporting agencies have agreed to pay the participating states $6 million and to make a number of changes to their business practices to benefit consumers. Nebraska’s portion of the settlement funds is $100,543.22.
A violation of the settlement, an Assurance of Voluntary Compliance, by any of the credit reporting agencies may be enforced by the states according to state law. In Nebraska, for example, a violation of an Assurance of Voluntary Compliance is prima facie evidence of a violation of the state’s Consumer Protection Act, meaning it would provide sufficient proof for the state to establish a case.
“A consumer’s credit score is an important part of their financial life. The settlement today is a result of years of negotiations, and provides significant protections for Nebraskans,” said Attorney General Peterson.
The settlement is the result of a multistate investigation focused on consumer disputes about credit report errors, monitoring and disciplining data furnishers (providers of credit reporting information), accuracy in consumer credit reports, and the marketing of credit monitoring products to consumers who call the credit reporting agencies to dispute information on their credit report.
Under the settlement, the credit reporting agencies have agreed to increase monitoring of data furnishers, to require additional information from furnishers of certain types of data, to limit direct-to-consumer marketing, to provide greater protections for consumers who dispute information on their credit reports, to limit certain information that can be added to a credit report, to provide additional consumer education, and to comply with state and federal laws, including the Fair Credit Reporting Act.
Key provisions of the settlement include:
Higher standards for data furnishers:
Limits to direct-to-consumer marketing:
Added protections for consumers who dispute credit reporting information:
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:
Additional consumer education:
The changes required under the settlement will be implemented in three phases to allow the credit reporting agencies to update their IT systems and procedures with data furnishers. All changes must be completed by three years and 90 days following the settlement’s effective date.
Participating in the settlement are the attorneys general from the states of: 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