Hyundai Hit With Largest Fair Credit Reporting Act Fine In History After Customer Credit Ruined
The finance partner of Hyundai, Kia, and Genesis within the USA, Hyundai Capital America, has been hit with a huge fine from the U.S. Consumer Financial Protection Bureau after “widespread credit reporting failures” harmed millions of customers.
It’s been reported by the government that the HCA has been giving credit reporting companies the wrong information, and when this wrong information was identified, the company didn’t take the proper steps to fix this. On top of this, the Financial Protection Bureau has added that it’s been using “manual and outdated systems, processes, and procedures to furnish credit reporting information – which led to widespread inaccuracies – and resulted in negative inaccurate information being placed on consumers’ credit reports through no fault of their own.”
According to the Financial Protection Bureau, HCA has damaged the credit report of over 2.2 million customers, with the majority of cases being known by the company, but unseen to.
These issues would come in the form of HCA reporting customers delinquent on loans and leases, while they’d actually paid in full. The government revealed that “in approximately 570,000 instances, Respondent (HCA) inaccurately inserted codes showing delinquent or no payments in the PHP (payment history profile) when the consumer had in fact made the required payments and the account was actually current.”
This ruined the credit score of customers, making it very difficult for them to get further loans or lower interest races across the board. This violated the Fair Credit Reporting Act, resulting in HCA being fined $13.2 million in compensation, as well as a $6 million civil penalty to the Consumer Financial Protection Bureau.
Consumer Financial Protection Bureau Director Rohit Chopra released in a statement: “Hyundai illegally tarnished credit reports for millions of borrowers, including by falsely reporting them to credit reporting companies as being delinquent on their loans and leases.
“Loan servicers must be complete and accurate when furnishing information that affects a borrower’s credit report.”
This fine is the largest Fair Credit Reporting Act case against an auto servicer in history, and with car finance being the third largest consumer credit market, this doesn’t come lightly.