Compliance Bulletin-The FCRA's Requirement That Furnishers Establish and Implement Reasonable Written Policies and Procedures Regarding the Accuracy and Integrity of Information Furnished to All Consumer Reporting Agencies, 5992 [2016-01987]

Agencies

[Federal Register Volume 81, Number 23 (Thursday, February 4, 2016)]
[Notices]
[Page 5992]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-01987]



[[Page 5992]]

=======================================================================
-----------------------------------------------------------------------

BUREAU OF CONSUMER FINANCIAL PROTECTION


Compliance Bulletin--The FCRA's Requirement That Furnishers 
Establish and Implement Reasonable Written Policies and Procedures 
Regarding the Accuracy and Integrity of Information Furnished to All 
Consumer Reporting Agencies

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Compliance bulletin.

-----------------------------------------------------------------------

SUMMARY: This document highlights existing obligations under the Fair 
Credit Reporting Act (FCRA) for furnishers of consumer information to 
consumer reporting agencies (CRAs) to establish and implement 
reasonable written policies and procedures regarding the accuracy and 
integrity of information furnished to all CRAs. In recent reviews of 
the furnishing practices of financial institutions, the Consumer 
Financial Protection Bureau (CFPB or Bureau) found that some financial 
institutions are not compliant with their obligations with regard to 
furnishing to specialty CRAs, including the furnishing of deposit 
account information. An institution's relevant policies and procedures 
must encompass the institution's furnishing to all types of CRAs.
    The CFPB will continue to monitor furnishers' compliance with these 
obligations to ensure they meet their accuracy and integrity 
obligations for any information that they furnish.

DATES: The Bureau released this Compliance Bulletin on its Web site on 
February 3, 2016.

FOR FURTHER INFORMATION CONTACT: Anthony Rodriguez, Attorney, 202-435-
9726; or Laurie Sellick, Attorney, 202-435-7262, Office of Supervision 
Policy.

SUPPLEMENTARY INFORMATION: 

I. Compliance Bulletin

    The CFPB issues this bulletin to emphasize the obligation of 
furnishers \1\ under Regulation V to establish and implement reasonable 
written policies and procedures regarding the accuracy and integrity of 
information relating to consumers that they furnish to CRAs. This 
obligation, which has been required under Regulation V since July 
2010,\2\ applies to furnishing to all CRAs, including furnishing to 
specialty CRAs, such as the furnishing of deposit account information 
to CRAs. Furnishers must have policies and procedures that meet this 
requirement with respect to all CRAs to which they furnish.
---------------------------------------------------------------------------

    \1\ 12 CFR 1022.41(c).
    \2\ See 74 FR 31484 (July 1, 2009). Although promulgated in July 
2009, the rule provided furnishers one year's notice of this 
obligation before the rule became effective on July 1, 2010.
---------------------------------------------------------------------------

    The supervisory experience of the Bureau suggests that some 
financial institutions are not compliant with their obligations under 
Regulation V with regard to furnishing to specialty CRAs. Furnishers' 
establishment and implementation of reasonable policies and procedures 
regarding the accuracy and integrity of information are essential 
components of a fair and accurate credit reporting system. Such 
policies and procedures protect against the furnishing of inaccurate 
information that could potentially cause adverse consequences for 
consumers when included in a credit report, such as being denied a loan 
at a more favorable interest rate or being unable to open a transaction 
account.
    While furnisher obligations under Regulation V are the focus of 
this bulletin, the CFPB recognizes that both furnishers and CRAs have 
independent obligations under the FCRA related to the accuracy of 
information and to the investigation of consumer disputes. The CFPB 
expects both furnishers and CRAs to comply with their respective 
duties.
    Furnishers must establish and implement reasonable written policies 
and procedures regarding the accuracy and integrity of information 
relating to consumers that they furnish to CRAs.\3\ These policies and 
procedures must be appropriate to the nature, size, complexity, and 
scope of each furnisher's activities.\4\ When creating these policies 
and procedures, furnishers must consider the factors listed in the 
``Interagency Guidelines Concerning the Accuracy and Integrity of 
Information Furnished to Consumer Reporting Agencies'' and incorporate 
those guidelines that are appropriate.\5\ Additionally, each furnisher 
must periodically review and update its policies and procedures to 
ensure their continued effectiveness.\6\
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 1681s-2(e); 12 CFR 1022.42(a).
    \4\ 12 CFR 1022.42(a).
    \5\ 12 CFR 1022.42(b). The guidelines are codified in Appendix E 
to Regulation V, 12 CFR part 1022.
    \6\ 12 CFR 1022.42(c).
---------------------------------------------------------------------------

    These policies and procedures must encompass the institution's 
furnishing to all types of CRAs. For example, if an institution 
furnishes both credit information to nationwide CRAs and deposit 
account information to nationwide specialty CRAs, that institution must 
consider the appropriate approach to each type of furnishing in its 
policies and procedures in order to comply with Regulation V.\7\ The 
type, frequency, and nature of the information furnished to CRAs can 
vary significantly. There also may be significant differences in the 
reporting formats and codes used to furnish to these agencies. An 
institution's obligation to have ``reasonable written policies and 
procedures'' applies to all types of information relating to consumers 
furnished to each of the CRAs to which it furnishes.
---------------------------------------------------------------------------

    \7\ See 12 CFR part 1022, Appendix E, Sec.  I(a).
---------------------------------------------------------------------------

    The CFPB will continue to monitor furnishers' compliance with the 
Regulation V requirement to establish and implement reasonable written 
policies and procedures regarding the accuracy and integrity of all 
furnished information. Furnishers must ensure that they have such 
policies and procedures in place with respect to all information 
furnished. If the CFPB determines that a furnisher has engaged in any 
acts or practices that violate Regulation V or other federal consumer 
financial laws and regulations, it will take appropriate supervisory 
and enforcement actions to address violations and seek all appropriate 
remedial measures, including redress to consumers.

II. Regulatory Requirements

    This Compliance Bulletin summarizes existing requirements under the 
law and findings made in the course of exercising the Bureau's 
supervisory and enforcement authority, and is a non-binding general 
statement of policy articulating considerations relevant to the 
Bureau's exercise of its supervisory and enforcement authority. It is 
therefore exempt from notice and comment rulemaking requirements under 
the Administrative Procedure Act pursuant to 5 U.S.C. 553(b). Because 
no notice of proposed rulemaking is required, the Regulatory 
Flexibility Act does not require an initial or final regulatory 
flexibility analysis. 5 U.S.C. 603(a), 604(a). The Bureau has 
determined that this Compliance Bulletin does not impose any new or 
revise any existing recordkeeping, reporting, or disclosure 
requirements on covered entities or members of the public that would be 
collections of information requiring OMB approval under the Paperwork 
Reduction Act, 44 U.S.C. 3501, et seq.

    Dated: January 27, 2016.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2016-01987 Filed 2-3-16; 8:45 am]
 BILLING CODE 4810-25-P