Home > Credit Score > Consumer Watchdog Plans to Regulate Credit Bureaus Next

Comments 1 Comment

The Consumer Financial Protection Bureau head announced Monday plans to begin regulation of credit reporting agencies.

In a field hearing in Detroit, CFPB Director Richard Cordray said the impact a credit report can have on so many aspects of consumers’ lives is why the bureau is turning its attention to the private credit reporting industry.

“We have heard reports since from many consumers that their credit reports are not accurate, and it is difficult to get them corrected,” Cordray said. “Because of the critical role that credit reports play in consumers’ lives, it is our job to make sure we understand the full extent of these problems and address them effectively.”

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the power to supervise nonbank “larger participants” in the financial products industry. The big three credit reporting agencies in the U.S. — Experian, Equifax and TransUnion — are the most recognizable to consumers, but the new rule will not regulate only the big three. The CFPB said in a press release that its new supervisory powers will extend to any credit reporting agency with more than $7 million in receipts — a rule that will blanket about 94% of the industry.

The rule will take effect Sept. 30 with a three-pronged focus: determining accuracy of information reported to credit bureaus, understanding how the bureaus handle the information and ensuring that the bureaus quickly and easily deal with error disputes.

“As I said earlier, this country’s credit reporting system is a resource in which we all have a stake,” Cordray said. “That system must merit our trust and confidence for the credit markets to be perceived as fair. We all share in this responsibility.”

Cordray also pushed consumers to take control of their own credit issues.

“Keep in mind that nobody else has as much incentive to protect you as you have to protect yourself,” he said. “Checking your credit report can reveal odd entries you do not recognize, which may be signs of identity theft. It also can uncover errors that will hurt your creditworthiness unless you dispute them and get them fixed. I urge every consumer to perform this self-check at least once every year.”

If you want to check your credit report for free, you can get a full copy of your report from any of the three major credit reporting agencies or you can get your Credit Report Card, a free tool that provides your credit score and a summary of your credit report.

Image: Iragerich, via Flickr

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • mike Smothers

    When a credit card company issues me a new credit card, say BankOne for instance, is this reported to the credit bureaus? And if so, are the credit bureaus required by law to share this information with the other credit bureaus? I have been unable to find the answer to this question and have checked in many places.

  • Pingback: Will a New Credit Card Change My Score? | ComparePlastic()

Certain credit cards and other financial products mentioned in this and other sponsored content on Credit.com are Partners with Credit.com. Credit.com receives compensation if our users apply for and ultimately sign up for any financial products or cards offered.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team