Protecting Your Credit Score Act of 2019
Floor Speech
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Ms. WATERS. Madam Speaker, pursuant to House Resolution 1017, I call up the bill (H.R. 5332) to amend the Fair Credit Reporting Act to ensure that consumer reporting agencies are providing fair and accurate information reporting in consumer reports, and for other purposes, and ask for its immediate consideration in the House.
The Clerk read the title of the bill.
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Ms. WATERS. 5332 and to insert extraneous material thereon.
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Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, I rise in support of H.R. 5332, the Protecting Your Credit Score Act of 2020.
I would like the thank Representative Gottheimer, the bill's sponsor, for all of his hard work and leadership on this important and bipartisan legislation. He worked extensively for most of last year to seek the input and support of our colleagues on both sides of the aisle, making improvements along the way.
Our credit reporting system is badly broken, and consumers have little recourse. It should be no surprise that consumer complaints regarding credit reporting errors and failed attempts to fix these errors are consistently a top complaint submitted to the Consumer Financial Protection Bureau and the Federal Trade Commission. This demonstrates that millions of consumers are frustrated with the current system and need our help.
H.R. 5332 would direct the nationwide consumer reporting agencies to create a streamlined, single online portal for consumers to have easy access to free credit reports, credit scores, dispute errors, and place security freezes.
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Ms. WATERS. Madam Speaker, I yield as much time as he may consume to the gentleman from New Jersey (Mr. Gottheimer), author of this bill and a member of the Committee on Financial Services.
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Ms. WATERS. Madam Speaker, I yield 5 minutes to the gentleman from New Jersey (Mr. Gottheimer).
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Ms. WATERS. Madam Speaker, I yield 3 minutes to the gentleman from Illinois (Mr. Casten), a member of the Financial Services Committee.
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Ms. WATERS. Madam Speaker, may I inquire as to how much time I have remaining.
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Ms. WATERS. Madam Speaker, I yield 3 minutes to the gentleman from New Jersey (Mr. Gottheimer).
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Ms. WATERS. Madam Speaker, I would inquire through the Chair if my colleague has any remaining speakers on his side.
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Ms. WATERS. Madam Speaker, I reserve the right to close, and I reserve the balance of my time.
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Ms. WATERS. Madam Speaker, I yield myself the balance of my time.
Madam Speaker, it has been nearly 17 years since major reform legislation to address common problems with credit reporting has been enacted into law. To that end, I am pleased that, earlier this year, the House passed H.R. 3621, the Comprehensive Credit Reporting Enhancement, Disclosure, Innovation, and Transparency Act.
Representative Gottheimer's bipartisan bill complements those efforts to ensure we have a well-functioning credit reporting system that is streamlined and easy to use and that better protects the data of all consumers.
Republicans were in charge when Equifax exposed sensitive data of 150 million Americans. What was their response? Nothing.
Earlier this year, the House passed the Comprehensive CREDIT Act to overhaul our broken credit reporting system and enhance cybersecurity of the credit reporting bureaus. Republicans voted no.
Representative Gottheimer offered this bill that would strengthen cybersecurity of Equifax and other credit bureaus, and now Republicans are saying no.
We have some Republicans who oppose giving the CFPB expanded authority, although I would note Ranking Member McHenry introduced H.R. 3821 that would do just that, giving the CFPB authority of cybersecurity for the credit bureaus. The bill before us would do the same.
I would urge Republicans to reconsider their opposition to the bill. I urge an ``aye'' vote on this commonsense bill.
Madam Speaker, I include in the Record support for this bill from the Americans for Financial Reform, the National Consumer Law Center, Consumer Action, Consumer Federation of America, Consumer Reports, National Association of Consumer Advocates, World Privacy Forum, and also the National Association of Realtors. June 23, 2020.
Dear Chairwoman Waters: The undersigned consumer organizations write to support H.R. 5332, the Protecting Your Credit Score Act of 2019 (Gottheimer). This bill will address serious problems in the credit reporting system and empower consumers by providing them with much greater access to and control over their own information.
Credit reports and credit scores play a huge role in determining a consumer's financial health. Not only do they determine a consumer's ability to obtain credit at a fair price, but they are used by many other sectors--insurance companies, landlords and even employers. Despite their importance, credit reports are also full of errors, which can cost a consumer thousands of dollars in higher-priced credit, or worse yet, result in the denial of a job, insurance coverage, an apartment rental, or the ability to open a small business or buy a house. The Federal Trade Commission's definitive study showed that 21% of consumers had verified errors in their credit reports, 13% had errors that affected their credit scores, and 5% had errors serious enough to cause them to be denied or pay more for credit.
Trying to fix these errors can be a Kafka-esque nightmare in which the Big Three nationwide consumer reporting agencies (CRAs)--Equifax, Experian and TransUnion--consistently favor the side of the creditor or debt collector (``the furnisher'') over the consumer. As documented in NCLC's report Automated lniustice Redux (2019), some of the most serious problems include consumers having their credit files ``mixed'' with the wrong person, being unable to remove negative information even after court judgments in their favor, the after-effects of identity theft when CRAs don't believe the victim, and being labeled as dead when they are alive and breathing. The report also documents the massive number of credit and consumer reporting complaints to the Consumer Financial Protection Bureau (CFPB), over 380,000 since July 2011, which is often the top category of complaints to the CFPB.
The irony of these problems is that credit reports consist of our information. Yet consumers are only entitled to free access to this information once a year and in certain other limited situations, despite the fact that the Big Three nationwide CRAs are making tens of millions selling our financial data. Also, consumers are not entitled to our own credit scores for free, while these same scores are being sold to creditors and others for hefty profits.
Last, but not least, there are serious issues with data security at the nationwide CRAs, of the type that led to the massive Equifax data breach in 2017. These data security issues have not yet been adequately addressed.
The Protecting Your Credit Score Act of 2019 would address these issues by:
Fixing the broken system for credit reporting disputes by (1) creating a CFPB ombudsperson that will have the power to resolve persistent errors when CRAs don't fix them properly, and to make referrels to the Office of Supervision or the Office of Enforcement for supevisory or enforcement action when CRAs don't comply with their disput investigation reponsibilities and (2) requiring CRAs to dedicate sufficient resources and provide proper training to personnel who handle disputes.
Giving consumers the tools they need to access their rights, understand their creditworthiness, and control their financial destinies by (1) giving consumers the right to unlimited free credit reports and free credit scores online; (2) requiring the Big Three nationwide CRAs to create a simple, easy-to-use portal tool to access online credit reports and credit scores, as well to exercise other important rights such as placing a security freeze, initiating a dispute, and opting out of prescreening (i.e., the use of credit report information to generate offers of credit).
Improving credit reporting accuracy by (2) requiring CRAs to conduct periodic audits to check for accuracy and (2) mandating that Big Three nationwide CRAs use all 9 digits of the consumer's Social Security number when matching information from a lender to a consumer's file, thus preventing mixed files, which are one of the worst types of errors.
Improving data security for credit reports by giving the CFPB the authority to write rules under the Gramm-Leach- Bliley Act to govern the Big Three nationwide CRAs.
Give consumers a tool to compel CRAs to fix a credit report by providing them with a right to seek injunctive relief so that a court could order a CRA to correct an error or otherwise follow the law.
There are a number of other important reforms in the bill, such as giving consumers the right to opt out of the selling or sharing of information about them that does not fall into the FCRA's current definition of ``consumer report'' and creating a comprehensive registry of all consumer reporting agencies.
The above reforms are urgently needed in order to ensure that consumers are treated fairly by the credit reporting system and that they have the access and control that they should be entitled to. Thus, we support the Protecting Your Credit Score Act of 2019 an look forward to working with you to swiftly enact it into law.
Thank you for your attention. If you have any questions about this letter, please contact Chi Chi Wu (cwu@nclc.org) at (617) 542-8010. Sincerely, Americans for Financial Reform, National Consumer Law Center (on behalf of its low-income clients), Consumer Action, Consumer Federation of America, Consumer Reports, National Association of Consumer Advocates, USPIRG, World Privacy Forum. ____ National Association of Realtors, Washington, DC, June 23, 2020. Hon. Josh Gottheimer, Washington, DC.
Dear Representative Gottheimer: On behalf of the 1.4 million members of the National Association of REALTORS
NAR has a long history of involvement in issues concerning the use and disclosure of consumer credit data. Nearly 90 percent of home sales are financed, and a borrower's credit report and credit score form a critical gateway to obtaining a mortgage. Unfortunately, inaccurate credit reports and unfair credit reporting methods raise the cost to borrow and/ or limit access to mortgage credit for many prospective borrowers.
REALTORS
Creditor and consumer confidence are critical in the home financing process, and our nation's housing market and overall economy benefit tremendously from balanced financial regulation and appropriate consumer protection. REALTORS
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Ms. WATERS. Madam Speaker, I yield back the balance of my time.
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