Lawsuit Alleges Equifax Delays Dispute Investigations With ‘Onerous’ Identity Confirmation Process

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Equifax faces a proposed class action over its alleged practice of requiring consumers to provide “multiple, needless forms of identification” before it begins to investigate credit report information disputes.

According to the lawsuit, the federal Fair Credit Reporting Act (FCRA) requires consumer reporting agencies such as defendant Equifax Information Services, LLC to reasonably and timely investigate disputes concerning “any item” of information in consumer credit reports. Despite this requirement, Equifax has allegedly demanded that consumers provide “document after document” to confirm their identity “before it would even begin” to investigate their disputes.

“Nothing in the FCRA permits or justifies Equifax’s creation of roadblocks to the processing of disputes, yet Equifax repeatedly and unjustifiably requires consumers to provide additional evidence of their identity before it will begin an investigation,” the complaint scathes.

The plaintiff, a Virginia resident, claims to have learned in November 2020 that an account with Hyundai Motor Finance was being reported on her Equifax credit file as 180 days past due. Per the case, the plaintiff mailed Equifax a written dispute contesting the allegedly inaccurate information. Although the dispute letter contained the plaintiff’s full name, address, phone number, date of birth and the last four digits of her Social Security number, Equifax mailed a response stating it refused to investigate the woman’s dispute because she had provided insufficient identification information, the suit relays.

When the plaintiff then provided her full Social Security number and copies of her driver’s license and Social Security card, Equifax, the lawsuit alleges, responded with “yet another standard form letter” informing her that it refused to investigate the dispute due to insufficient information. According to the case, Equifax has been “sued repeatedly” for “falsely claiming that the consumer did not provide sufficient identification information.”

The lawsuit points out that Equifax makes no money processing disputes, which are “purely an expense” for the agency. According to the filing, it is in Equifax’s best interest to reject disputes “for any possible reason, as doing so saves money.”

The suit moreover states that despite the “onerous requirements” placed on consumers to verify their identities, Equifax will sell their consumer reports to customers who “provide as little as a consumer’s first name, last name, and any previous address.”

Per the lawsuit, Equifax’s requirement that consumers provide their full name; current and former addresses; Social Security number; date of birth; pay stub and W-2 form with their full Social Security number; Social Security card; and a copy of either their driver’s license, rental/lease agreement, house deed, pay stub with address or utility bill acts as a hurdle to prevent consumers from filing disputes.

Moreover, the case argues the identity-verification process causes “actual economic harm” to consumers given they’re required to spend money on copies and postage and spend time complying with Equifax’s demands in order to “obtain the rights and reinvestigation the law otherwise mandates.”

The plaintiff additionally claims to have experienced harm from the publishing of inaccurate credit information that “should have been removed and corrected” by Equifax if not for the agency’s allegedly unlawful conduct.

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