Even as at least two Senators consider allowing the IRS to start reporting tax debts to credit rating bureaus, comes word that one of the biggest - Equifax -- has agreed to pay $393,000 to settle Federal Trade Commission (FTC) charges that it improperly sold lists of consumers who were late on their mortgage payments.
According to the FTC's complaint, Equifax sold more than 17,000 prescreened lists of millions of consumers who were 30, 60, or 90 days late on their mortgage payments to companies including Direct Lending Source, Inc., which then resold the lists to companies that used them to pitch debt relief and mortgage loan modification services to financially strapped consumers.
Selling prescreened lists of consumers - consumers who meet specific criteria - for general marketing purposes is a violation of the Fair Credit Reporting Act (FCRA).
The FTC further charged that Equifax failed to investigate when it learned that Direct Lending Source was illegally reselling its lists, and continued to sell the lists to Direct Lending Source despite having knowledge of the violation.
For its part in the violation, Direct Lending Source, Inc. agreed to pay $1.2 million in civil penalties and to comply with several sanctions imposed by the court. In addition to its $393,000 fine, Equifax agreed to stop furnishing prescreened lists to anyone that it does not have reason to believe has a permissible purpose to receive them.