Yesterday, the Consumer Financial Protection Bureau (CFPB) released its fourth annual report detailing the complaints received from military servicemembers, veterans and their families. Since the CFPB first started taking complaints in July of 2011, the complaint volume has steadily risen. In 2015, the CFPB received thousands of credit reporting complaints from the military community. The reporting of inaccurate credit information was by far the most complained about followed by complaints about the credit reporting company's investigation process.
When a consumer disputes the completeness or accuracy of any information contained in his/her credit report, the consumer reporting agency (CRA) must conduct a "reinvestigation." The term "reinvestigation" is a statutory term under the Fair Credit Reporting Act (FCRA). If the reinvestigation reveals that the information is inaccurate or cannot be verified, the CRA must promptly delete the information. 15 U.S.C. § 1681i(a). Failure to conduct a reasonable reinvestigation violates the FCRA. Cushman v. Trans Union Corp., 115 F.3d 220, 223–24 (3d Cir.1997). The burden to conduct the reinvestigation is on the credit reporting agency. It cannot be shifted back to the consumer.
A credit reporting agency's reinvestigation obligation is to verify the accuracy of its original source of information. This duty may include going beyond the original source. Whether the credit reporting agency must go beyond the original source depends on a number of factors, including: (1) whether the consumer has alerted the CRA that the original source may be unreliable; (2) whether the CRA itself knows or should know that the original source is unreliable; and (3) the comparative costs of verifying the accuracy of the original sources versus the potential harm the inaccurate information may cause the consumer. Dixon-Rollins v. Experian Information Solutions, Inc., 753 F.Supp.2d 452 (2010).