Banking and Finance Law Daily CFPB settles with debt collector Afni for credit reporting violations
News
Friday, November 13, 2020

CFPB settles with debt collector Afni for credit reporting violations

By Nicole D. Prysby, J.D.

Afni will improve its procedures and will pay a $500,000 million civil penalty to settle allegations that it furnished inaccurate information to credit reporting agencies, failed to conduct investigations of disputes, and failed to send required consumer notices.

The Consumer Financial Protection Bureau has announced a settlement with debt collector Afni, Inc. Afni, a non-bank Illinois-based debt collector, specializes in collecting debt for telecommunications companies. The Bureau issued a Consent Order against Afni, finding that it violated the Fair Credit Reporting Act (FCRA), its implementing rule, Regulation V, and the Consumer Financial Protection Act (CFPA) by furnishing inaccurate information to credit reporting agencies, failing to conduct investigations of disputes, and failed to send required consumer notices. Afni will pay a $500,000 million civil penalty and take steps to improve the accuracy of its furnishing of consumer information to credit reporting agencies and its policies and procedures relating to credit reporting and dispute investigation.

According to the Consent Order (to which Afni stipulated), the Bureau found that Afni’s conduct violated the FCRA, Regulation V, and the CFPA, in that Afni furnished inaccurate information to credit reporting agencies, failed to conduct reasonable investigations of disputes, and failed to send required consumer notices. Specifically, Afni’s automated system incorrectly translated data in its files into the format used to report consumer information, resulting in Afni furnishing inaccurate data. For example, Afni furnished actual payment amounts as zero dollars on approximately 165,600 accounts, even though those consumers had made payments and furnished current balances and furnished amounts past due in amounts other than zero dollars on approximately 72,000 accounts, even though those consumers’ accounts were settled in full. Afni knew the furnished information was inaccurate, because it was different from the data in Afni’s own files. Afni also failed to specify an accurate date of first delinquency, but used, for example, the date on which telecommunications services were disconnected or the date a debt was charged off. Finally, Afni failed to respond to or conduct reasonable investigations of disputes, failed to conspicuously specify an address to which consumers could send a notice that information Afni furnished to a credit reporting agency was inaccurate, and failed to establish policies regarding furnishing activities. For example, Afni had no policy explaining how to conduct a reasonable investigation of a FCRA dispute.

The Bureau’s Consent Order requires Afni to pay a $500,000 civil money penalty and to take steps to improve the accuracy of its furnishing of consumer information to credit reporting agencies and its policies and procedures relating to credit reporting and dispute investigation. Those steps include monthly reviews of account samples to verify accuracy and integrity of information, updating policies and procedures, retaining an independent consultant to review policies and procedures and create a compliance plan, creating a compliance committee, requiring Board oversight, and complying with recordkeeping and reporting obligations.

Companies: Afni, Inc.

MainStory: TopStory CFPB DebtCollection EnforcementActions FairCreditReporting

Back to Top

Interested in submitting an article?

Submit your information to us today!

Learn More

Banking and Finance Law Daily: Breaking legal news at your fingertips

Sign up today for your free trial to this daily reporting service created by attorneys, for attorneys. Stay up to date on banking and finance legal matters with same-day coverage of breaking news, court decisions, legislation, and regulatory activity with easy access through email or mobile app.