FTC Settles Reporting Issues With Credit Tracker Equifax

Equifax Credit Information Services Inc., one of the largest credit-reporting agencies, has agreed to settle a complaint alleging that it failed to protect the accuracy and confidentiality of consumer credit records.

In the settlement with the Federal Trade Commission, Equifax admitted no wrongdoing, but it agreed to make changes in the way it deals with disputed credit information.

The FTC has investigated several credit-reporting companies in the past few years, agency spokesman Howard Shapiro said.

“It’s one of those things that doesn’t seem to end: people having problems with the privacy and accuracy of credit reports,” he said.

Equifax agreed to review within 30 days any information disputed by a consumer. If it doesn’t verify the information within that period, it must delete it from the consumer’s record until it is verified.

Also, when a consumer provides documentation to back up the consumer’s version of a dispute, Equifax is required to accept that version unless it has reason to doubt the authenticity of the document.

The FTC had accused Equifax of violating the Fair Credit Reporting Act, which is designed to ensure the truth and confidentiality of consumer credit reports.

Equifax allegedly failed to delete inaccurate or unverified information promptly after receiving a complaint and to prevent deleted information from reappearing. The company was also accused of giving credit reports to third parties that had no legitimate reason to obtain them.

The agreement avoids litigation that could have resulted in civil penalties of $10,000 per violation. Shapiro said he did not know precisely how many individual violations were alleged.

Equifax and other companies have recently announced several programs for addressing complaints. For example, Equifax established a 24-hour information center and stopped selling mailing lists to direct marketers.

The agreement between the FTC and Equifax will be subject to public comment for 60 days before approval becomes final.

The company said most of the practices required in the settlement have already been adopted. The deal “places few new obligations” on Equifax, it said in a statement.