CFPB’s Crackdown on Credit Reporting Failures Exposes Major Violations Impacting Consumers Petroff Amshen LLP Fights for Consumer Justice Against Reckless Financial Institutions | Petroff Amshen LLP

February 11, 2025

CFPB’s Crackdown on Credit Reporting Failures Exposes Major Violations Impacting Consumers Petroff Amshen LLP Fights for Consumer Justice Against Reckless Financial Institutions

The Consumer Financial Protection Bureau (CFPB) has once again taken a decisive step in holding financial institutions accountable, demanding a $12.8 million penalty from a major auto financing company for scandalous credit reporting violations. This action follows the company’s misreporting of payment statuses during the COVID-19 pandemic, which affected 300,000 consumers. Petroff Amshen LLP stands firm in supporting consumers, demanding that these financial institutions be held accountable for their harmful actions.

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Inaccurate credit reporting isn’t just an inconvenience—it’s a damaging mistake that can have life-altering consequences for consumers. When financial institutions misreport payment statuses, they put individuals at risk, including harming their ability to secure housing, loans, or employment. This failure has long-term implications for borrowers, especially those affected during times of crisis, such as the COVID-19 pandemic.

"Consumers should never have to suffer due to the mistakes of financial institutions. At Petroff Amshen LLP, we’re committed to ensuring that companies and any involved third parties are held accountable for their actions, and that your rights are always protected."

— Serge F. Petroff, Founding Partner, Petroff Amshen LLP

In this particular case, the auto financing company, American Honda Motor Co., Inc., offered payment deferrals during the pandemic but incorrectly reported those borrowers as delinquent. Despite acknowledging its mistakes, the company failed to rectify the situation, resulting in ongoing damage to the borrowers' financial standing.

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"It’s not just about credit scores—it’s about people’s lives. That’s why we fight for accountability and transparency in every case."

Furthermore, the company’s failure didn’t stop at erroneous reporting. It also refused to investigate disputes filed by consumers who sought to challenge the false information. This negligence violated federal consumer protection laws, disregard for consumer rights and the law by these financial institutions and any other third-party companies involved.

At Petroff Amshen LLP, we understand the far-reaching consequences of such reckless behavior. Credit reporting mistakes go beyond hurting credit scores—they can prevent consumers from accessing loans, cause job rejections, and lead to higher borrowing costs. Financial institutions and third-party companies that refuse to act responsibly must be held accountable.

"When financial institutions and third-party companies fail to uphold their duty to consumers, the damage is far-reaching. It’s not just about credit scores—it’s about people’s lives. That’s why we fight for accountability and transparency in every case."

— Serge F. Petroff, Founding Partner, Petroff Amshen LLP

The CFPB’s ruling orders the company to pay $10.3 million in compensation to affected consumers and a $2.5 million fine. While these penalties are necessary, they do little to repair the damage caused to borrowers. This case raises troubling questions about the role of third-party companies in perpetuating these deceptive practices and the industry's ongoing failure to protect consumers.

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This latest case is not an isolated incident. The CFPB has taken similar actions against other financial institutions, such as Hyundai and Toyota, as well as credit reporting agencies like Equifax and Experian, which have all faced penalties for failing to properly investigate consumer disputes and for mishandling credit reporting. These repeated violations show that the problem is systemic, and regulatory fines alone are not enough to put off such reckless behavior.

At Petroff Amshen LLP, we are committed to proactively defending consumers' rights against unfair practices and the role of third-party companies in facilitating these violations. Our team is dedicated to holding lenders, credit reporting agencies, and other financial institutions accountable when they misreport information, refuse to fix mistakes, or mislead borrowers. Consumers deserve transparency, accuracy, and the power to correct errors that harm their financial futures.

If you’ve been affected by false credit reporting or other unfair practices by financial institutions or third-party companies, don’t fight this battle alone. Petroff Amshen LLP is here to help you understand your legal options, challenge deceptive practices, and fight for the justice you deserve. You have the law on your side, and we’re with you every step of the way.