Tag: Medical Debt Collector

CFPB Fines Medical Debt Collector For FCRA Violations June 27, 2023 A news release by the Consumer Financial Protection Bureau (CFPB) recently revealed a business's violation of the Fair Credit Reporting Act (FCRA). According to the announcement, the CFPB ordered an Indiana-based medical debt collection business to pay a $1.675 million penalty. The firm is a third-party debt collector that collects past-due medical debts and provides information to CRAs about consumers. The CFPB took action against the medical debt collection company due to its many credit reporting and debt collection violations. Such violations included the company attempting to collect an unsubstantiated debt after a consumer had disputed the debt's validity. According to the CFPB Director, "With medical debt looming over so many American families, we are taking action against companies seeking to illegally profit off patients." The Director also mentioned, "Given widespread inaccuracies in medical billing and credit reporting, the CFPB will be working to ensure that patients are not coerced into paying debts that they do not owe." The CFPB published a report last year indicating that 43 million consumers had medical bills included on their credit reports. This inclusion can make obtaining employment, affordable credit, and housing challenging. In some cases, these reports have proven inaccurate. Consumer reporting agencies (CRAs) then use this incorrect or false information to coerce consumers to pay medical debts or bills they did not owe. The medical debt collection company risked hurting consumers when sending collection letters based on false information. Furthermore, the company did more than send letters for debt the consumers did not owe. They also furnished information about the debts to CRAs despite consumers' disputes. The company's failure to conduct reasonable investigations likely caused inaccuracies to appear on many credit reports. The CFPB's order requires the debt collection company to do the following: Stop all unlawful collections and credit reporting practices. Do not state that a consumer owes a debt before substantiating the claim. Establish and implement written policies and procedures to ensure reasonable investigations for disputes. Cooperate with any CFPB investigations. Subject to the supervisory authority of the CFPB during the order's duration. Refund any money consumers paid to them for unverified debts after the consumer received an unlawful letter. Pay the CFPB a penalty of $1.675 million. This case shows the importance of complying with the Fair Credit Reporting Act, which includes background checks. Ensuring compliance is crucial for avoiding violations and costly fines. As such, partnering with a trustworthy background screening company can assist companies with compliance. Remain up to date with the latest developments by downloading Pre-employ’s free resource guide on 5 Tips To Avoid FCRA Non-Compliance. Source

Tag: Medical Debt Collector

CFPB Fines Medical Debt Collector For FCRA Violations

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