The Consumer Financial Protection Bureau (CFPB) has fined TD Bank $20 million for reporting inaccurate information on consumer credit reports, marking another major penalty for the bank following a $122 million fine in 2020 for illegal overdraft fees.
TD Bank $20M fine :Credit Report Violations
The CFPB’s investigation revealed that TD Bank, a subsidiary of Canada’s Toronto-Dominion Bank, made systematic errors in reporting customers’ credit card delinquencies and bankruptcies. Additionally, the bank is required to pay $7.76 million in compensation to tens of thousands of customers who were negatively affected by the inaccurate information shared with consumer reporting agencies.
CFPB Director Rohit Chopra criticized TD Bank for not taking timely action to address the erroneous information. “The CFPB’s investigation found that TD Bank illegally threatened the consumer reports of its customers with fraudulent information and then barely lifted a finger to fix it,” Chopra said.
Bank Failures and Consumer Impact
The CFPB found that TD Bank not only reported inaccurate data about customers’ credit card accounts but also failed to correct errors related to fraudulent bank accounts in a timely manner. In some cases, it took the bank over a year to address these issues, violating the Fair Credit Reporting Act and the Consumer Financial Protection Act. These errors affected thousands of customers who applied for credit, housing, or employment.
