Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
CUNA Mutual Group warns of info-reporting risks to CUs
WASHINGTON (7/18/08)—Credit unions must guard against possible lawsuits by knowing how to properly report member information to credit bureaus, warns CUNA Mutual Group in a recent risk alert.
click to view the video Click to view the video
The Fair Credit Reporting Act (FCRA) requires credit unions-- as furnishers of information to consumer reporting agencies--to report accurate information, conduct prompt investigations in the event of a dispute, and to correct any reporting errors. CUNA Mutual notes that lawsuits have cropped up in several states. The suits target credit unions for alleged mistakes made reporting member debts that had been discharged in bankruptcy. They contend that charged-off debt was reflected as still being owed. The resulting negative impact of such a mistake to a member could include lower credit scores and a resulting higher interest rate, higher costs in various in other types of consumer transactions, such as insurance, and denied credit, according to CMG. Other damages alleged in suits have included such things as embarrassment, defamation, mental anguish, emotional distress, and inconvenience, the alert adds. To avoid problems, CUNA Mutual recommends credit unions take the following steps:
* Know who at your credit union is responsible for assuring correct information is reported to credit bureaus. Have detailed procedures for handling credit reporting, bankruptcy credit reporting, disputes, and potential identity theft issues. Knowledge of proper terminology and coding for applicable data fields is essential. * Be familiar with, and understand, various codes used by credit bureaus you work with. Ensure proper codes are provided for each consumer. Adhere to industry standards for the reporting of accurate, complete, and timely credit information. * Assure that credit union staff works with credit bureau staff to ensure correct bankruptcy reporting. The bureaus may also have resources available that can audit and provide summaries to verify how information is being reported. * Check with the credit bureau on reporting procedures for an unusual situation or with questions on reporting. Bureaus are generally very willing to work with credit unions they serve because it keeps both parties out of regulatory trouble. * Have follow-up procedures in place for times when your credit union is notified that a reporting mistake has been made. Make necessary changes on your in-house system so misreporting does not resume the month after the manual change is made.
Valerie Moss, director of compliance information for the Credit Union National Association (CUNA), encourages credit unions to bone up on credit bureau reporting issues, especially the subject of the CMG alert. “CUNA’s compliance department has fielded questions from a number of credit unions lately on how to properly report bankruptcies to credit bureaus.”


RSS print
News Now LiveWire
Access to Affordable Mortgages Act passed by Hse Fin Serv. 31-23.CUNA says bill gives CUs reg relief & incr. access to mortg credit.
7 minutes ago
Bill sponsor said will support amndmt to incl. NCUA in the study & delay the agency's risk-based capital plan b4 full House vote. 2of2
15 minutes ago
Bill directing banking agencies to study appropriate capital requirmnts for mrtg servicing assets for nonsystemic banks clears committee1of2
18 minutes ago
The .@FinancialCmte passed #HR4042 and #HR5148 this morning. Both are reg. relief bills and have the strong support of @CUNA
20 minutes ago
FHFA today announced it's extending comment deadline for guarantee fees Fannie, Freddie charge lenders to Sept. 8.
16 hours ago