NEW YORK (AP) -- The companies that determine Americans' credit scores are about to come under scrutiny by the country's new consumer watchdog.
The Consumer Financial Protection Bureau said Monday that it will start supervising the 30 largest firms that make up 94 percent of the industry. That includes the three big credit reporting firms: Equifax Inc., Experian and TransUnion.
This marks the first time that a single government agency will take an active role in policing credit bureaus, according to industry experts. The Fair Credit Reporting Act currently requires them to keep accurate information about consumers.
Richard Cordray, the government agency's director, said in a speech Monday that the CFPB said its oversight may include on-sight examinations, and that it may require credit bureaus to file reports.
"It's a wonderful thing for the American public," said Pamela Banks, the senior policy counsel for Consumers Union, the policy arm of Consumer Reports. "Now there's somebody on their side."
Each of the three major credit reporting agencies maintains files on more than 200 million Americans. These reports are filled with a history of loan payments, credit card accounts and other financial details. Past behavior, from late payments to credit-card balances, is used to create a credit score.