(a) Nature and Scope. Section 222.42(a) of this part requires that
a furnisher’s policies and procedures be appropriate to the nature,
size, complexity, and scope of the furnisher’s activities. In developing
its policies and procedures, a furnisher should consider, for example:
(1) The types of business activities in
which the furnisher engages;
(2) The nature and frequency of the information
the furnisher provides to consumer reporting agencies; and
(3) The technology used by
the furnisher to furnish information to consumer reporting agencies.
(b) Objectives. A furnisher’s policies and procedures should be reasonably designed
to promote the following objectives:
(1) To furnish information about accounts
or other relationships with a consumer that is accurate, such that
the furnished information:
(i) Identifies the appropriate consumer;
(ii) Reflects the terms
of and liability for those accounts or other relationships; and
(iii) Reflects the
consumer’s performance and other conduct with respect to the account
or other relationship;
(2) To furnish information about accounts
or other relationships with a consumer that has integrity, such that
the furnished information:
(i) Is substantiated by the furnisher’s
records at the time it is furnished;
(ii) Is furnished in a form and manner
that is designed to minimize the likelihood that the information may
be incorrectly reflected in a consumer report; thus, the furnished
information should:
(A) Include appropriate identifying information
about the consumer to whom it pertains; and
(B) Be furnished in a standardized and clearly
understandable form and manner and with a date specifying the time
period to which the information pertains; and
(iii) Includes the credit
limit, if applicable and in the furnisher’s possession;
(3) To conduct reasonable
investigations of consumer disputes and take appropriate actions based
on the outcome of such investigations; and
(4) To update the information it furnishes
as necessary to reflect the current status of the consumer’s account
or other relationship, including, for example:
(i) Any
transfer of an account (e.g., by sale or assignment for collection)
to a third party; and
(ii) Any cure of the consumer’s failure to abide by the terms of
the account or other relationship.
