Texas Auto-Finance Firm Fined for Providing Inaccurate Information

August 21, 2014
Wall Street Journal 
auto financing news
The Consumer Financial Protection Bureau (CFPB) on Aug. 20 ordered an auto finance company to pay a $2.75 million fine for ignoring "known flaws" in a computer system that for years provided inaccurate information to credit reporting agencies about consumers' loan payments and other information.

The lender, Texas-based First Investors Financial Services Group, must fix the errors and change its business practices, the watchdog said. An investigation of the company discovered that the reporting problems had been going on for at least three years, resulting in skewed data about customers' debt payments being sent to credit reporting agencies. The company notified the vendor but took no other action to remedy the problem.

"First Investors showed careless disregard for its customers' financial lives by knowingly distorting their credit profiles for years," said CPFB director Richard Cordray. "Companies cannot pass the buck by blaming a computer system or vendor for their mistakes. Today's action sends a signal that the CFPB will hold companies accountable for sending inaccurate information to credit-reporting agencies."

Abstract News © Copyright 2008-2013 INFORMATION, INC.
Powered by Information, Inc.

Stay Updated

Join the fight against predatory lending. Enter your e-mail to sign up for breaking news, action alerts, and CRL's original research.

   Please leave this field empty

Help Us End Predatory Lending

Predatory lending destroys family wealth, and preys on our most vulnerable communities. You can help us end abusive lending practices by donating to CRL, or by sharing our work with others.