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Credit reporting companies should do more to ensure that servicemembers receive the free credit monitoring services they are legally entitled to

The unique demands and challenges of serving in the military – including permanent change of duty stations and multiple deployments – can make it difficult for servicemembers to review their credit reports, identify suspicious accounts, and dispute inaccuracies. Unsurprisingly, servicemembers report more cases of identity theft than other adults. The law requires credit reporting companies to offer free services to help servicemembers monitor their credit, but unfortunately, some servicemembers are not receiving them.

Inaccuracies in credit reporting are all too common. Credit or consumer reporting issues made up 54% of all complaints to the Consumer Financial Protection Bureau submitted by servicemembers in 2022. The CFPB has taken action to address inaccurate information on credit reports, including issuing guidance to consumer reporting companies about their obligation to screen for and eliminate false data from consumers’ credit reports, and shining a light on how changes in consumer reporting companies’ handling of complaints resulted in fewer meaningful responses and less consumer relief. Patterns of inaccuracy are all the more concerning when the credit reporting companies that are reporting inaccurate information are also charging individuals to monitor for those very inaccuracies.

For servicemembers, having good credit isn’t only important for things like getting a loan – their security clearances, and therefore often their jobs, also depend on it. Due to servicemembers’ unique situations, many feel they must rely on credit monitoring products to stay informed and up to date about their credit history, know what is being reported, and get information that could be helpful to recognize identity theft.

Congress saw the importance of credit reporting to the military community and acted to help servicemembers keep their credit reports accurate and up to date. In 2018, Congress passed a law requiring nationwide credit reporting companies to provide a free electronic credit monitoring service that, at a minimum, notifies active duty members (including reservists called to active service) stationed away from their usual duty station and National Guard members about material changes in their credit files. In 2019, the three major nationwide credit reporting companies (Equifax, Experian, and TransUnion) started providing free electronic credit monitoring services to all active duty servicemembers and National Guard members who request the service and verify their identity.

These were important steps toward helping servicemembers stay mission-focused, without having to worry about their credit. Nonetheless, the CFPB has received complaints that suggest that servicemembers are not always getting the free services they’re entitled to under the law and that credit reporting companies could do more to ensure that servicemembers get these services.

Complaints show credit reporting companies are charging servicemembers for credit monitoring services when they’re entitled to free services.

Complaints to the CFPB suggest that credit reporting companies may be enrolling servicemembers in paid credit monitoring products without providing servicemembers with clear or sufficient information about the free credit monitoring they are eligible for.

For instance, the CFPB has received complaints that suggest credit reporting companies may not be making their call center representatives aware that many servicemembers have the right to free credit monitoring.

Credit reporting companies could take steps to identify servicemembers and tell them about the free products that are available

The primary places servicemembers go for information about credit monitoring services – the credit reporting companies’ websites and call centers – ought to actively inform servicemembers about their right to free credit monitoring whenever possible. Credit reporting companies should ensure that staff, including call center representatives, are trained about the free products available to servicemembers. Credit reporting companies should also take proactive steps to identify which consumers may be servicemembers. At the very least, staff should be trained so that when a consumer indicates that they are a servicemember, the representative should clearly inform the consumer about services that are available for free to verified servicemembers and which services require payment.

Given their unique market position, credit reporting companies ought to do more to help servicemembers take advantage of the specific protections Congress provided.

What Servicemembers Should Know About Monitoring Their Credit:

  • If you are on active duty or are a member of the National Guard, you can sign up to have access to free electronic credit monitoring from each of the three major credit reporting companies.
  • You can view the CFPB’s step by step guide on how to review, improve, and protect your credit history.
  • You can submit a complaint to the CFPB online. Complaints have proven invaluable in our work helping military consumers, and we will continue to use them to hold companies accountable.

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