Big Changes on Horizon for Credit Reporting of Public Records Data

This article previously appeared on the Venable blog, and is republished here with permission.

On the heels of the CFPB's publication of a Special Edition of its Supervisory Highlights focused on consumer reporting, the three nationwide credit reporting agencies (CRAs) are making significant changes to how public records will be reported on credit reports. Starting July 1, civil judgments and tax liens will be excluded from credit reports unless they meet heightened data standards. Specifically, to be accepted, public records data must meet the following criteria:

1. a minimum of consumer personal identifying information (name, address, and SSN and/or date of birth) and
2. a minimum frequency of courthouse visits to obtain newly filed and updated public records of at least every 90 days.

The CRAs expect that a vast majority of public records data furnished to the CRAs will not meet these standards and therefore will be deleted from credit reports (or, for new records, will not be reported in the first place).

The CFPB's Special Edition Supervisory Highlights, issued March 2, specifically referenced earlier exams of CRAs where examiners concluded that one or more of the CRAs lacked quality control policies and procedures to test the accuracy of the public records data furnished to them. However, the report goes on to note that in follow-up reviews, the CFPB has observed improvements in the oversight of public records providers, including by enhancing the standards for the public records data that will be accepted and by increasing the frequency and scope of audits of its third-party public records providers.

The change announced by the three CRAs is part of a larger initiative, the National Consumer Assistance Plan, which was launched in March 2015 after the three companies entered into settlement agreements with the New York Attorney General and later a group of 31 state attorneys general.