New York Consumer Law Blog

In personal finance, practically everything can turn on one’s credit score. It’s both an indicator of one’s financial past, and the key to accessing necessities—without insane costs—in the future. But on Tuesday, the Consumer Financial Protection Bureau announced that two of the three major credit-reporting agencies responsible for doling out those scores—Equifax and Transunion—have been deceiving and taking advantage of Americans. The Bureau ordered the agencies to pay more than $23 million in fines and restitution.  

In their investigation, the Bureau found that the two agencies had been misrepresenting the scores provided to consumers, telling them that the score reports they received were the same reports that lenders and businesses received, when, in fact, they were not.

Did you get a telemarketing robocall five or six years ago offering a "free cruise" in return for taking a short survey? If you did, and you can prove it, you can get about $500 for each one of those illegal calls.

Florida-based Caribbean Cruise Line and its two co-defendants — Vacation Ownership Marketing Tours and The Berkeley Group — have agreed to pay between $56 and $76 million to settle a class action lawsuit that claimed they made millions of unwanted and illegal robocalls between August 2011 and August 2012 in violation of the Telephone Consumer Protection Act

Caribbean Cruise Line launched a major robocall campaign in August 2011 to landlines and cellphones. The automated messages told people they would get a free cruise if they took a short survey. Those who responded were connected to a live operator at Caribbean Cruise Line who attempted to upsell them a more expensive vacation package that required the travelers sit through a timeshare presentation at a resort owned by The Berkeley Group.

More than a million people may be eligible for that money, but here's the catch — you have to file a claim in order to be included in the settlement.
Read more . . .

A new legal settlement from the Consumer Financial Protection Bureau alleges that Experian, one of the big three credit-reporting bureaus, “deceptively marketed credit scores to consumers by misrepresenting” them as “the same” as what their lender would use in determining whether and on what terms to offer them a loan.

 In fact, said the bureau, the scores Experian advertised extensively were its own proprietary “educational” scores that virtually no lenders use to make credit decisions.

As part of the settlement, Experian was fined $3 million. The case follows Consumer Financial Protection Bureau settlements in January over similar allegations with the other national credit bureaus — Equifax and TransUnion — in which they were required to make $17.6 million in restitution to consumers and pay $5.
Read more . . .

The CFPB’s vision is rooted in the obligations and rights set forth in the Fair Credit Reporting Act (FCRA) and Regulation V.1 In the last two years, we identified failings in compliance management systems and violations of law both at CRCs and at furnishers.
Read more . . .

The bank is upgrading all 13,000 of its ATMs to process withdrawals using smartphones rather than debit cards. Chase and Bank of America plan to roll out their own version of cardless ATMs, too.

Auto Lending: Last Week Tonight with John Oliver

Handing over your credit card to your teenager might not seem like a good idea.

But it might actually be a smart financial move. Not only can it help kids learn money management skills, it can also help their credit score.

Adding a child as an authorized user on a parent's credit card can give the child a boost when it comes to establishing a strong credit profile. That is, as long as the parents are in good credit standing.

What GAO Found

Identity theft services offer some benefits but have limitations.

• Credit monitoring helps detect new-account fraud (that is, the opening of new unauthorized accounts) by alerting users, but it does not prevent such fraud or address existing-account fraud, such as misuse of a stolen credit card number. Consumers have alternatives to credit monitoring, including requesting a low-cost credit freeze, which can prevent new-account fraud by restricting access to the consumers' credit report.

• Identity monitoring can alert consumers to misuse of certain personal information by monitoring sources such as public records or illicit websites, but its effectiveness in mitigating identity theft is unclear.

Wells Fargo is having a hard time getting Americans to sign up for credit cards these days.

Credit card applications at Wells Fargo plunged by 55% in February, the sharpest decline since the bank's fake account scandal erupted last September.

Another sign of trouble: Wells Fargo (Read more . . .

Held by Maryland’s Highest Court:

Midland Funding waived its right to arbitration when it sued Mr. Cain in small claims court.  Because Midland was unlicensed when they sued him, the judgment against him and all other class members is VOID.