ing consumer complaints about credit reporting 
in October 2012. 
(L) As of February 2017, the Consumer 
Bureau has handled approximately 185,717 
credit reporting complaints, making credit re-
porting consistently the third most-complained- 
about subject matter on which the Consumer 
Bureau accepts consumer complaints. 
(M) In the ‘‘Monthly Complaint Report 
Volume 20’’, released in February 2017, the 
Consumer Bureau noted that 76 percent of 
credit reporting complaints involved incorrect 
information on reports, with consumers fre-
quently expressing their frustrations about the 
burdensome and time-consuming process to dis-
puting items. 
(N) Other common types of credit report-
ing complaints submitted to the Consumer Bu-
reau related to the improper use of a report, 
trouble obtaining a report or credit score, 
CRAs’ investigations, and credit monitoring or 
identity protection. 
(O) In the summer 2015 ‘‘Supervisory 
Highlights’’, the Consumer Bureau noted that 
one or more of the largest CRAs failed to ade-
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quately oversee furnishers to ensure that they 
were adhering to the CRA’s vetting policies and 
to establish proper procedures to verify public 
record information. 
(P) According to the fall 2016 ‘‘Super-
visory Highlights’’, Consumer Bureau exam-
iners determined that one or more debt collec-
tors never investigated indirect disputes that 
lacked detail or were not accompanied by at-
tachments with relevant information from the 
consumer. Examiners also found that notifica-
tions sent to consumers about disputes consid-
ered frivolous failed to identify for the con-
sumers the type of material that they could pro-
vide in order for the debt collector to complete 
the investigation of the disputed item. 
(Q) A February 2014 Consumer Bureau 
report titled ‘‘Credit Reporting Complaint 
Snapshot’’ found that consumers are confused 
about the extent to which the nationwide CRAs 
are required to provide them with validation 
and documentation of a debt that appears on 
their credit report. 
(R) As evidence that the current system 
lacks sufficient market incentives for CRAs to 
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develop more robust procedures to increase the 
accuracy and completeness of information on 
credit reports, litigation discovery documented 
by 
the 
National 
Consumer 
Law 
Center 
(‘‘NCLC’’), as part of a January 2009 report 
titled, ‘‘Automated Injustice: How a Mecha-
nized Dispute System Frustrates Consumers 
Seeking to Fix Errors in Their Credit Re-
ports’’, showed that at least two of the three 
largest CRAs use quota systems to force em-
ployees to process disputes hastily and without 
the opportunity for conducting meaningful in-
vestigations. At least one nationwide CRA only 
allowed dispute resolution staff five minutes to 
handle a consumer’s call. Furthermore, these 
CRAs were found to have awarded bonuses for 
meeting quotas and punished those who didn’t 
meet production numbers with probation. 
(S) Unlike most other business relation-
ships, where consumers can register their satis-
faction or unhappiness with a particular credit 
product or service simply by taking their busi-
ness elsewhere, consumers have no say in 
whether their information is included in the 
CRAs databases and limited legal remedies to 
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hold the CRAs accountable for inaccuracies or 
poor service. 
(T) Accordingly, despite the existing statu-
tory mandate for CRAs to follow reasonable 
procedures to assure the maximum possible ac-
curacy of the information whenever they pre-
pare consumer reports, numerous studies, the 
high volume of consumer complaints submitted 
to the Consumer Bureau about incorrect infor-
mation on consumer reports, and supervisory 
activities by the Consumer Bureau demonstrate 
that CRAs continue to skirt their obligations 
under the law. 
(2) PRIVATE EDUCATION LOANS.— 
(A) The Consumer Bureau’s October 2014 
report titled ‘‘Annual Report of the CFPB Stu-
dent Loan Ombudsman’’ noted many private 
education loan borrowers, who sought to nego-
tiate a modified repayment plan when they were 
experiencing a period of financial distress, were 
unable to get assistance from their loan holders, 
which often resulting in them defaulting on 
their loans. This pattern resembles the dif-
ficulty that a significant number of mortgage 
loan borrowers experienced when they sought to 
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take responsible steps to work with their mort-
gage loan servicer to avoid foreclosure during 
the Great Recession. 
(B) Although private student loan holders 
may allow a borrower to postpone payments 
while enrolled in school full-time, many limit 
this option to a certain time period, usually 48 
to 66 months. This limited time period may not 
be sufficient for those who need additional time 
to obtain their degree or who want to continue 
their education by pursing a graduate or profes-
sional degree. The Consumer Bureau found 
that borrowers who were unable to make pay-
ments often defaulted or had their accounts 
sent to collections before they were even able to 
graduate. 
(3) DECEPTIVE PRACTICES AT CERTAIN PRO-
PRIETARY EDUCATION INSTITUTIONS AND CAREER 
EDUCATION PROGRAMS.— 
(A) NCLC cited the proliferation of law 
enforcement actions against many for-profit 
schools in its June 2014 report, titled ‘‘Ensur-
ing Educational Integrity: 10 Steps to Improve 
State Oversight of For-profit Schools’’, to dem-
onstrate the pervasive problem in this sector of 
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targeting low-income students with deceptive 
high-pressure sales techniques involving inflated 
job placement rates and misleading data on 
graduate wages, and false representations about 
the transferability of credits and the employ-
ability of graduates in occupations that require 
licensure. Student loan borrowers at these 
schools may be left with nothing but worthless 
credentials and large debt. Those who default 
on their student loans face years with damaged 
credit that will adversely impact their ability to 
rent or buy homes, purchase cars, and find em-
ployment. 
(B) The closure and bankruptcy of Corin-
thian Colleges, which was found to have de-
ceived students by steering them into high-in-
terest student loans based on misleading grad-
uation rates and employment data, is a good 
example of the problem. Even after its closure, 
many Corinthian students remained saddled 
with student loan debt, worthless degrees, and 
few prospects for employment. 
(C) Attending a two-year, for-profit college 
costs, on average, four times as much as at-
tending a community college. Students at for- 
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profit colleges represent only about 11 percent 
of the total higher education population but a 
startling 44 percent of all Federal student loan 
defaults, according to the United States De-
partment of Education (‘‘DOE’’). 
(D) According to NCLC, a dispropor-
tionate number of for-profit students are low-in-
come and people of color. These schools target 
veterans, working parents, first-generation stu-
dents, and non-English speaking students, who 
may be more likely than their public or private 
nonprofit school counterparts to drop out, incur 
enormous student debt, and default on this 
debt. In the 2011–2012 school year, 28 percent 
of African Americans and 15 percent of Latinos 
attending four-year institutions were enrolled in 
a for-profit school, compared to 10 percent of 
Whites. 
(E) As highlighted in a press release titled 
‘‘Obama Administration Announces Final Rules 
to Protect Students from Poor-Performing Ca-
reer College Programs’’, that was issued by the 
DOE on October 30, 2014, ‘‘øt¿oo often, stu-
dents at career colleges—including thousands of 
veterans—are charged excessive costs, but don’t 
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get the education they paid for. Instead, stu-
dents in such programs are provided with poor 
quality training, often for low-wage jobs or in 
occupations where there are simply no job op-
portunities. They find themselves with large 
amounts of debt and, too often, end up in de-
fault. In many cases, students are drawn into 
these programs with confusing or misleading in-
formation.’’. 
(4) MEDICAL DEBT.— 
(A) Research by the Consumer Bureau has 
found that the inclusion of medical collections 
on consumer reports has unfairly reduced con-
sumers’ credit scores. 
(B) The Consumer Bureau’s review of 5 
million anonymized credit files from September 
2011 to September 2013, for example, found 
that credit scores may underestimate a person’s 
creditworthiness by up to 10 points for those 
who owe medical debt, and may underestimate 
a person’s creditworthiness by up to 22 points 
after the medical debt has been paid. For con-
sumers with lower credit scores, especially those 
on the brink of what is considered subprime, a 
10 to 22 point decrease in their credit scores 
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can have a significant impact on their lives, in-
cluding by affecting whether they are able to 
qualify for credit and, if so, the terms and con-
ditions under which it is extended to them. 
(C) The Consumer Bureau found that half 
of all collections trade lines that appear on con-
sumer reports are related to medical bills 
claimed to be owed to hospitals and other med-
ical providers. These trade lines affect the re-
ports of nearly 1⁄5 of all consumers in the credit 
reporting system. 
(D) The Consumer Bureau has found that 
there are no objective or enforceable standards 
that determine when a debt can or should be 
reported as a collection trade line. Because debt 
buyers and collectors determine whether, when, 
and for how long to report a collection account, 
there is only a limited relationship between the 
time period reported, the severity of a delin-
quency, and when or whether a collection trade 
line appears on a consumer’s credit report. 
(E) Medical bills can be complex and con-
fusing for many consumers, which results in 
consumers’ uncertainty about what they owe, to 
whom, when, or for what, that may cause some 
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people, who ordinarily pay their bills on time, to 
delay or withhold payments on their medical 
debts. This uncertainty can also result in med-
ical collections appearing on consumer reports. 
In a December 2014 report titled ‘‘Consumer 
Credit Reports: A Study of Medical and Non- 
Medical Collections’’, the Consumer Bureau 
found that a large portion of consumers with 
medical collections show no other evidence of fi-
nancial distress and are consumers who ordi-
narily pay their other financial obligations on 
time. Unlike with most credit products or serv-
ices, such as credit cards, installment loans, 
utilities, or wireless or cable services that have 
contractual account disclosures describing the 
terms and conditions of use, most consumers 
are not told what their out-of-pocket medical 
costs will be in advance. Consumers needing ur-
gent or emergency care rarely know, or are pro-
vided, the cost of a medical treatment or proce-
dure before the service is rendered. 
(F) The Consumer Bureau concluded that 
the presence of medical collections is less pre-
dictive of future defaults or serious delin-
quencies than the presence of a nonmedical col-
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lection in a study titled ‘‘Data Point: Medical 
Debt and Credit Scores’’, issued in May 2014. 
(G) FICO’s latest credit scoring model, 
‘‘FICO 9’’, changes the treatment of paid col-
lections to disregard any collection matters that 
the consumer has paid in full. FICO 9, how-
ever, is not yet widely used by lenders. 
(H) VantageScore’s latest credit scoring 
model, ‘‘VantageScore 4.0’’, will be available in 
the fall of 2017. This model will penalize med-
ical collections less than non-medical ones. 
(I) The three nationwide CRAs entered 
into a settlement agreement with the New York 
State attorney general in 2015 to address defi-
ciencies in their dispute resolution process and 
enhance the accuracy of items on reports. These 
policy changes will be implemented in a three- 
phrased rollout, culminating by June 2018. 
Subsequently, these CRAs entered into a coop-
erative agreement with 31 State Attorneys Gen-
eral, which was the basis of the creation of the 
National Consumer Assistance Plan (‘‘NCAP’’) 
to change some of their business practices. 
(J) While the CRAs appear to be volun-
tarily adopting policy changes on a nationwide 
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basis, they are not obligated to do so for con-
sumers who reside in States that are not party 
to any of the consent orders. 
(K) As a result of the settlement agree-
ments, the three nationwide CRAs will set a 
180-day waiting period before including medical 
collections on a report and will remove a med-
ical collection from a report once it is paid by 
an insurance company. While this change will 
benefit many, once a medical collection appears 
on a report, it will only be deleted or suppressed 
if it is found to have been the insurance com-
pany’s obligation to pay and the insurer pays it. 
Given the research showing there is little pre-
dictive value in medical debt information, med-
ical collections that are paid or settled should 
quickly be removed from a report, regardless of 
who pays or settles this debt. 
(5) FINANCIAL ABUSE BY KNOWN PERSONS.— 
(A) Financial abuse and exploitation are 
frequently associated with domestic violence. 
This type of abuse may result in fraudulent 
charges to a credit card or having fraudulent 
accounts created by the abuser in the survivor’s 
name. Financial abuse may also result in the 
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survivor’s inability to make timely payments on 
their valid obligations due to loss or changes in 
income that can occur when their abuser steals 
from or coerces the survivor to relinquish their 
paychecks or savings. 
(B) By racking up substantial debts in the 
survivor’s name, abusers are able to exercise fi-
nancial control over their survivors to make it 
economically difficult for the survivor, whose 
credit is often destroyed, to escape the situa-
tion. 
(C) Domestic abuse survivors with poor 
credit are likely to face significant obstacles in 
establishing financial independence from their 
abusers. This can be due, in part, because con-
sumer reports may be used when a person at-
tempts to obtain a checking account, housing, 
insurance, utilities, employment, and even a se-
curity clearance as required for certain jobs. 
(D) Providing documentation of identity 
(‘‘ID’’) theft in order to dispute information on 
one’s consumer report can be particularly chal-
lenging for those who know their financial 
abuser. 
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(E) While it is easier for consumers who 
obtain a police report to remove fraudulent in-
formation from their consumer report and pre-
vent it from reappearing in the future, accord-
ing to the Empire Justice Center, safety and 
other noncredit concerns may impact the capac-
ity of a survivor of financial abuse committed 
by a known person to turn to law enforcement 
to get a police report. 
(F) According to the Legal Aid Society in 
New York, domestic abuse survivors, seeking to 
remove adverse information stemming from fi-
nancial abuse by contacting their furnishers di-
rectly, are likely to face skepticism about claims 
of ID theft perpetrated by a partner because of 
an assumption that they are aware of, and may 
have been complicit in, the activity which the 
survivor alleges stems from financial abuse. 
(6) DECEPTIVE AND MISLEADING MARKETING 
PRACTICES.— 
(A) The Consumer Bureau’s February 
2015 report titled ‘‘Consumer Voices on Credit 
Reports and Scores’’ found that some con-
sumers did not obtain a copy of their consumer 
report due to concerns about security or of 
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being trapped into purchasing unwanted prod-
ucts like an additional report or a credit moni-
toring service. 
(B) In January 2017, the Consumer Bu-
reau fined TransUnion and Equifax for decep-
tively marketing credit scores for purchase by 
consumers as the same credit scores typically 
used by lenders to determine creditworthiness 
and for luring consumers into costly subscrip-
tion services that were advertised as ‘‘free’’ or 
‘‘$1’’ that automatically charged recurring fees 
unless cancelled by consumers. The Consumer 
Bureau also found that Equifax was illegally 
advertising its products on webpages that con-
sumers 
accessed 
through 
AnnualCreditReport.com before consumers ob-
tained their free disclosures. Because of these 
troubling practices, TransUnion was ordered to 
pay $13.9 million in restitution to harmed con-
sumers and a civil penalty of $3 million to the 
Consumer Bureau. Equifax was ordered to pay 
more than $3.7 million to affected consumers 
as well as a civil money penalty of $2.5 million 
to the Consumer Bureau. As part of the con-
sent orders, the CRAs are also supposed to 
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(A) in subparagraph (B)(ii), by striking 
‘‘an incapacitated person or a protected person’’ 
and inserting ‘‘a person’’; and 
(B) by amending subparagraph (E) to read 
as follows: 
‘‘(E) The term ‘security freeze’— 
‘‘(i) has the meaning given in sub-
section (i)(1)(C); and 
‘‘(ii) with respect to a protected con-
sumer for whom the consumer reporting 
agency does not have a file, means a 
record that is subject to a security freeze 
that a consumer reporting agency is pro-
hibited from disclosing to any person re-
questing the consumer report for the pur-
pose of opening a new account involving 
the extension of credit.’’; and 
(2) in paragraph (4)(D), by striking ‘‘a pro-
tected consumer or a protected consumer’s rep-
resentative under subparagraph (A)(i)’’ and insert-
ing ‘‘a protected consumer described under subpara-
graph (A)(ii) or a protected consumer’s representa-
tive’’. 
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