WASHINGTON (12/8/15)--Bogus credit report actions and debt collection practices prompted two Consumer Financial Protection Bureau (CFPB) actions in recent days.
On Monday the CPFB filed a federal complaint against EOS CCA, a Massachusetts debt collection firm, for reporting and collecting on old cellphone debt that consumers disputed and EOS did not verify.
The company also provided inaccurate information to credit reporting companies about the debt and failed to correct reported information that it had determined was inaccurate, according to the bureau.
The CFPB’s proposed consent order calls for EOS to refund at least $743,000 to consumers; cease collecting and reporting on disputed AT&T debt; stop collecting on unverified debts; ensure accuracy when providing information to credit reporting companies; stop reselling debts for five years; and pay a $1.85 million civil money penalty.
Last week, the bureau took action against Clarity Services, Inc., a credit reporting company, for illegally obtaining consumer credit reports and failing to appropriately investigate consumer disputes.
The bureau alleges Clarity generated marketing materials for prospective clients by illegally obtaining tens of thousands of consumer reports without a permissible purpose, and used that information to market its products.
It is also alleged Clarity failed to investigate consumer disputes, including disputes relating to credit inquiries, even though it was aware that some consumer files were populated with information from unreliable sources.
Clarity Services, Inc. and its owner, Tim Ranney, have been ordered to halt illegal practices; improve the way they investigate consumer disputes and obtain, sell, and resell consumer credit reports; and pay an $8 million penalty.