Consumers disputed up to 38 million items on their consumer credit reports last year at the three largest consumer reporting agencies, according to a report released Thursday by the Consumer Financial Protection Bureau.
Nearly 40 percent of those disputes were linked to some form of debt collection.
"We found the information provided by the collections or debt buying industry is more likely to be questioned by a consumer than, say, the data from their mortgage lender," CFPB Director Richard Cordray said. "In fact, the information provided by the collections industry is five times more likely to be disputed than mortgage information."
Exactly how many of the overall disputes were resolved is unclear, but the report was the first attempt by the consumer agency to collect details on the nation's largest credit agencies: Equifax Information Services, Experian Information Solutions and TransUnion, according to American Banker, a Collections & Credit Risk sister publication.
How the credit agencies handle the disputes is a "source of controversy," the report said. The agencies most often send the disputes back to the original data provider, called a "furnisher," which includes banks and credit card companies, through an automated system of simple codes. The furnishers are required by law to investigate the disputes and then accurately report back to the agencies.
But the agencies rarely give the furnisher any paper documentation that the consumer provides and have only resolved disputes themselves about 15% of the time.
Though the CFPB cautioned it was not drawing conclusions from the 48-page report, the statistics revealed fractures in the accuracy of the massive credit reporting system.
For the full story, go to American Banker.