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CFPB Issues Policy Statement on Credit Reporting and Compliance with CARES Act 

credit reportingOn April 1, the CFPB issued a policy statement addressing the responsibility of furnishers under the CARES Act and describing the flexible approach the Bureau intends to take with respect to supervision and enforcement of the FCRA and Regulation V during the COVID-19 pandemic.

In the policy statement, the Bureau notes that the CARES Act partially amends the FCRA and requires furnishers to report as current certain credit obligations for which consumers affected by COVID-19 have sought accommodation.

The Bureau expects furnishers to comply with the CARES Act and the Bureau will assist furnishers as needed. The Bureau also encourages furnishers to work with consumers, either voluntarily or as required by the CARES Act, to provide payment relief; and the Bureau states that it does not intend to cite in examinations or bring enforcement actions against furnishers who furnish credit information that accurately reflects the payment relief provided to consumers.  

 Addressing the duty to timely investigate disputes, the Bureau recognizes that a number of CRAs and furnishers are working through significant operation disruptions that might affect their ability to investigate disputes within the timeframes required by the FCRA.

The Bureau says that it will consider the unique challenges faced by each CRA and furnisher in evaluating whether to cite in an examination or bring an enforcement action; and the Bureau does not intend to cite or bring an action against any entity that made a good faith effort to investigate a dispute as quickly as possible.

The Bureau also reminds CRAs and furnishers that there is no requirement to investigate disputes submitted by credit repair organizations or disputes that the CRA or furnisher reasonably determines to be frivolous or irrelevant.

In looking at whether a CRA or furnisher made a reasonable determination that a dispute was frivolous or irrelevant, the Bureau will consider the constraints affecting the CRA’s or the furnisher’s time, information, and other resources. 

For additional updates on the impact of COVID-19 on the financial services industry, click here.

Maurice Wutscher LLP will present a webinar, “Don’t Let COVID-19 Take Control of Your Business,” on Friday, April 3 at 4 pm ET. Click here to register.

 

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Brent Yarborough practices in Maurice Wutscher's Birmingham office in its Appellate, Commercial Litigation, Consumer Credit Litigation and Regulatory Compliance groups. He has substantial experience representing financial institutions, debt buyers and law firms. He has defended cases involving the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Truth In Lending Act, and various state law claims asserted against lenders and their assignees. He has also provided compliance advice on matters related to the FDCPA, UDAAP, and state debt collection laws. He is a frequent speaker to national audiences and publishes on topics related to consumer financial services regulation and litigation. For many years Yarborough has served on the Executive Board of the Birmingham Bar Association’s Bankruptcy and Commercial Law Section. He also serves on the Legislative Task Force of the Creditor Attorney Association of Alabama and is the immediate past president of the Birmingham-Southern College National Alumni Association. In October 2015, he was elected Secretary of NARCA – The National Creditors Bar Association, after serving on its Board of Directors for the previous eight years. In addition, he chairs NARCA’s Government and Regulatory Affairs Committee. Yarborough earned his B.A., cum laude, from Birmingham-Southern College and his J.D. from Cornell University, where he was Secretary/Treasurer of the Cornell Law School Moot Court Board. For more information, see https://mauricewutscher.com/attorneys/brent-yarborough/

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