Equifax will pay $393,000 to settle charges that it improperly sold information to debt-service companies about homeowners who made late mortgage payments, according to Federal Trade Commission.
FTC says that between 2008 and 2010, Equifax sold 17,000 lists that had prescreened information about homeowners who were late in making their mortgage payments to Direct Lending Source, which is a credit consolidation company. Direct Lending Source sold homeowners’ information to third-party debt-settlement service companies that would market mortgage-relief services. The lists that Equifax sold included consumers’ credit scores and how many days late they were on their mortgage payment.
Companies are prohibited from using prescreened lists for general marketing purposes. Equifax’s and Direct Lending Source’s actions violated the Federal Trade Commision Act and the Fair Credit Reporting Act, according to FTC.
As a result of the settlement, Equifax is prohibited from providing prescreened lists to companies to use for debt-relief-service solicitations.
In a separate settlement, Direct Lending Source agreed to pay a $1.2 million civil penalty and is prohibited from selling and using prescreened lists to solicit debt-relief services.