April 12, 2022

CFPB Charges Major Credit-Reporting Agency with Violating Law Enforcement Order

The CFPB charged a credit-reporting agency, two of its subsidiaries and one of its senior executives with repeatedly failing to comply with a previously issued law enforcement order. The order, issued in 2017, was implemented to stop the agency from engaging in deceptive marketing regarding its credit score services and other credit-related products.

The CFPB Complaint alleges that the subsidiaries violated the Consumer Financial Protection Act of 2010 by engaging in several deceptive behaviors, including (i) the use of digital dark pattern behavior, (ii) cheating customers through the marketing and sale of its credit-related products and (iii) failing to comply with the terms of the previous law enforcement order on multiple occasions. Additionally, the Complaint alleges that through their actions, the senior executive involved will also be held liable for failing to comply.

CFPB Director Rohit Chopra highlighted the following reasons the charges are notable:

  • the uncommon instance of an individual being charged, as the senior executive was charged with not only knowingly and willingly disregarding the law enforcement order, but also actively impeding any process designed for compliance;
  • the pattern of deceptive behaviors the credit-reporting agency was allegedly engaged in; and
  • the case being representative of the CFPB's broader effort to rein in repeat offenders.

Additionally, Mr. Chopra mentioned several measures the CFPB is taking to prevent future repeat offenders, such as the creation of the Repeat Offender Supervision and Enforcement teams within the CFPB.

The CFPB is seeking monetary relief for consumers, such as restitution or return of funds, disgorgement or compensation for unjust gains, injunctive relief and civil money penalties.

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