Equifax and TransUnion Fined $23 Million for Misrepresenting Credit Products
- Category: Hall of Shame
Two of the nation's largest credit reporting bureaus, TransUnion and Equifax, will together pay more than $23 million fines and refunds to settle charges from a federal consumer watchdog that they misled consumers about the pricing and value of credit products.
The consumer financial protection bureau said that the companies deceived consumers by suggesting that the credit scores they provided were the same scores used by financial firms to make lending decisions when in fact, the scores "were not typically used by lenders." The firms were also unclear about their pricing structure, marketing them as free or costing $1 when actually costing up to $16 a month.
"Credit scores are central to a consumer's financial life and people deserve honest an accurate information about them," CFPB Director Richard Cordray said in a statement.
Equifax and TransUnion will pay $17.6 million combined in restitution for consumers and $5.5 million in fines to the CFPB. The companies will need to notify effected customers about the refunds.