US Consumer Watchdog Demands Information from Experian
By Rory Gallivan
LONDON--A U.S. consumer watchdog has demanded information from Experian PLC (EXPN.LN) as it investigates whether companies that provide information about consumers' credit worthiness are engaging in unlawful practices.
Experian, which collects information about consumers' loan and repayment history so banks and other institutions can determine how risky they are, received a Civil Investigative Demand from the Consumer Financial Protection Bureau, its Vice President of Investor Relations Peg Smith said in a meeting with analysts. A CID is a subpoena that requires the submission of documents and other information.
Experian's rival Equifax Inc ( EFX ) disclosed in April that it received a CID as the CFPB investigates possible unlawful acts relating to marketing, sales and provision of consumer reports and credit scores.
"We have also received a CID, but just know that it is nothing more than through a subpoena requesting additional information from our business that we had not prior to that been willing to disclose because of confidentiality," Ms. Smith said.
"There's no wrongdoing, there's no indication of problems," she added.
A spokesperson for Experian said the CID it received is "a standard request for information" as the CFPB investigates business practices of the major credit reporting agencies in the U.S. The spokesperson added that the company cannot disclose details of the request or Experian's response due to confidentiality requirements.
The CFPB didn't immediately respond to a request for details of the investigation it's conducting.
Regulators keep a close eye on credit checking companies such as Experian and Equifax because their reports play a big role in determining whether people's loan requests are approved and the rate of interest they must pay.
Experian earlier Friday reported a 4% rise in revenue for the three months ended June 30, helped by an improved environment for consumer and business lending in North America and the U.K.
North America accounted for half of Experian's revenue in the year ended March 31.
Shares at 1412 GMT, up 12 pence, or 1.2%, at 1,015 pence valuing the company at GBP10.1 billion ($17.3 billion).
Write to Rory Gallivan at email@example.com; Twitter: @RoryGallivan
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