Consumers in California become involved in a legal transaction each time they purchase a product. This fact is relevant even when the transaction is as simple as bottled water from a convenience store. Many shoppers are unaware that both state and federal regulations exist to protect their interests in these transactions.
The Santander example
Santander Consumer USA Holdings learned how serious officials are about protecting consumer rights when the company received a consent order from the Consumer Financial Protection Bureau. The consent order alleges that the company violated the Fair Credit Reporting Act and requires the company to pay a $4.75 million fine. The bureau is specific with an allegation that Santander submitted false consumer data to all three major credit bureaus.
The consent order explains that for a period beginning in January 2016 and ending in August 2019, Santander submitted regular consumer credit reports that included systematic errors. These errors included incorrect dates for when a particular account became delinquent. The bureau says the impact this data reporting problem could have on a consumer’s credit score is life-changing.
The bureau further alleges that Santander was aware of the incorrect data reporting as early as September 2016. According to reports, millions of accounts would eventually become affected by misinformation from Santander.
Consent order provisions
Santander must fix the internal issues causing the misreporting of consumer data in addition to the fine the company must pay. The company must take action to prevent similar problems in the future. The company was also required to provide a detailed report of the remedies taken within 45 days of consent order receipt.
The current consent order is not the first time Santander found itself in trouble with consumer protection groups in 2020. The company settled a dispute with a group of attorney generals by agreeing to pay a $550 million settlement in May 2020. The conflict stemmed from alleged malpractice in issuing sub-prime auto loans.
Consumer protections include complex laws and regulations that can become difficult for people unfamiliar with these laws to navigate. Individuals who suspect that they have suffered a violation of their consumer rights might benefit from contacting an attorney.