FTC and CFPB Sue Consumer Reporting Agency for Repeated FCRA Failures

The FTC and the CFPB sued a nationwide consumer reporting agency for Fair Credit Reporting Act ("FCRA") violations related to rental background check reports.

In the Complaint, filed in the U.S. District Court for the District of Colorado, the FTC and the CFPB alleged that the reporting agency, and a wholly owned subsidiary, failed to (i) follow "reasonable procedures" to assure accuracy of eviction records in tenant rental screening reports and (ii) identify a third-party vendor as a source for criminal and eviction records in its disclosures to consumers. The Complaint also alleges that the reporting agency did not provide updates on evictions after they were dismissed.

The FTC and CFPB alleged that the reporting agencies inaccurate and outdated information in rental background checks made "renters’ eviction histories appear more problematic" than they were, and could significantly interfere with consumers’ ability to secure housing.

The FTC and CFPB requested that the District Court order the reporting agency to (i) pay $11 million for affected consumers, (ii) stop illegal tenant screening practices, (iii) implement procedures for accurate eviction records and (iv) pay a $4 million penalty.