The credit reporting company Dun & Bradstreet is settling charges that it deceived small businesses over the benefits of a product and continuously failed to fix errors in their credit reports, the Federal Trade Commission said Thursday.
Dun & Bradstreet failed to give businesses a reliable way to clear up inaccurate information, and it then sold them a credit-building product that fell short of its promises, the agency said.
A faulty credit report “can be a huge burden on a small business, raising costs and choking off opportunities,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a press release.
“This order arms businesses with new tools to ensure a fair shake, stops D&B from profiting illegally from businesses’ pain, and returns funds to firms that got fleeced,” Levine said.
In a statement, Dun & Bradstreet said it cooperated fully with the FTC’s investigation and that it was committed to “operating with integrity, transparency and in compliance with the laws that apply to our business.”
“Our priority is to ensure that our small business customers receive the solutions, support and attention they deserve to help manage their businesses,” the company said.
The FTC’s settlement with Dun & Bradstreet comes as congressional Democrats are
CFPB Director Rohit Chopra, a former FTC commissioner, said in a press release last week: “America’s credit reporting oligopoly has little incentive to treat consumers fairly when their credit reports have errors.”
Much of the FTC’s complaint against Dun & Bradstreet revolved around the company’s CreditBuilder product, which the agency says cost businesses hundreds or thousands of dollars each year and was pitched as a way to improve their credit scores.
D&B promised that the CreditBuilder service would help by adding businesses’ payment history to their credit reports, but the FTC said the company repeatedly rejected many businesses’ submissions.
D&B telemarketers falsely told new customers that they needed to subscribe to CreditBuilder before getting a credit report from D&B, and that the company was unclear about auto-renewals for the product, according to the FTC.
Under the settlement agreement, which has yet to receive final approval by the FTC, D&B would be required to give refunds to many businesses that bought the CreditBuilder product between April 2015 and May 2020. It would also need to send letters to many current customers offering a refund and cancellation of its service.
In addition, Dun & Bradstreet would be required to make several changes to its procedures. The company would need to reinvestigate or delete faulty information on business credit reports after receiving complaints. It would also face new restrictions on automatically renewing businesses’ CreditBuilder subscriptions, and it would need to make clearer disclosures about the product.
FTC commissioners voted 4-0 to give the settlement agreement preliminary approval. The agreement will soon be open to public comment before the agency decides on whether to grant final approval.
