by: Henry Meier
When I saw that the CFPB was holding a conference on the use of account screening companies by credit unions and banks, I thought I had a slam-dunk for today’s blog. First, I could provide you with news you needed to know to start your day and second, I had a strong opinion as to whether or not the CFPB was engaging in appropriate use of its time, energy and resources. The news is still important, but the issues CFPB raised aren’t as clear-cut as I first thought.
First, the part you need to know. The CFPB is zeroing in on the use by banks and credit unions of what it describes as specialty consumer reporting agencies to determine whether or not to open a checking account or provide membership. As many credit unions know, these companies provide information on a consumer’s check writing and account history. According to Director Cordray:
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First, we are concerned about the information accuracy of these reports. Second, we are concerned about people’s ability to access these reports and dispute any incorrect information they may find. Third, we are concerned about the ways in which these reports are being used.