CFPB Also Fines TransUnion $8M for Deception About Delays in Security Freezes and Locks
WASHINGTON – Today, the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau’s (CFPB) launched a joint enforcement action against TransUnion for failing to ensure that the tenant screening reports that landlords rely on to decide who gets housing were accurate. TransUnion is also charged with withholding the names of third parties that provided inaccurate information.
“Today’s enforcement action makes it crystal clear that companies can’t get away with producing shoddy reports that harm renters and their families,” said Ariel Nelson, staff attorney at the National Consumer Law Center. “Too many people are shut out of housing because of inaccurate tenant screening reports that use unreliable data obtained from third-party vendors that tenant screening companies keep secret.”
Through its subsidiary, TransUnion Rental Screening Solutions, TransUnion provides tenant screening reports that include information about consumers’ credit, criminal, and eviction histories. Because landlords rely on these reports to decide who gets housing, they have an enormous impact on the lives of American renters, as described in NCLC’s recent report Digital Denials: How Abuse, Bias, and Lack of Transparency in Tenant Screening Harm Renters.
The CFPB and FTC have asked a federal court to order TransUnion to pay $11 million to consumers, pay a $4 million penalty, and stop illegal tenant screening practices, including stopping the reporting of multiple filings for a single eviction case or reporting eviction cases absent a final outcome.
In a separate action, today CFPB ordered TransUnion to pay $8 million for deceiving tens of thousands of consumers about delays (sometimes for years) in placing or removing security freezes or locks that the consumers had requested for their credit reports. Of that amount $3 million will go to harmed consumers and $5 million serves as a penalty.
“TransUnion’s conduct was outrageous, and it is lucky to get away with paying just $8 million,” said Chi Chi Wu, senior attorney at NCLC. “TransUnion not only failed to comply with federal and state laws on security freezes, it outright deceived consumers, falsely claiming that the security freezes or locks had been placed. TransUnion put thousands of consumers at risk – consumers who did the right thing and thought they had the strongest protection possible against identity theft.”
Finally, TransUnion failed to exclude thousands of consumers, including active-duty military servicemembers, from prescreened solicitation lists (such as junk mail lists for credit offers), which is required when consumers place certain “alerts” on their credit report, as required by the Fair Credit Reporting Act (FCRA). The alerts and exclusion from prescreening are supposed to be another identity theft prevention tool for consumers at high risk of being targets of that crime.
- Digital Denials: How Abuse, Bias, and Lack of Transparency in Tenant Screening Harm Renters, September 2023
- FCRA Remedies When Criminal Records Lead to Rental Denials, September 2023
- Zombie Records: How Sealed or Expunged Court Records in Tenant & Employment Screening Reports May Illegally Cost People Jobs & Housing, June 2022
- Broken Records Redux: How Errors by Criminal Background Check Companies Continue to Harm Consumers Seeking Jobs and Housing, December 2019
Since 1969, the nonprofit National Consumer Law Center® (NCLC®) has worked for consumer justice and economic security for low-income and other disadvantaged people in the U.S. through its expertise in policy analysis and advocacy, publications, litigation, expert witness services, and training.