What must a CRA do upon receiving a dispute from a consumer regarding the accuracy of their information?

When a Consumer Reporting Agency (CRA) receives a dispute from a consumer regarding the accuracy of their information, the correct action is to conduct an investigation. This essential step involves reviewing the disputed information and verifying its accuracy by contacting the source of the information. According to the Fair Credit Reporting Act (FCRA), CRAs are required to take these complaints seriously and act promptly to ensure that all consumer reports are accurate and up to date.

The need for an investigation stems from the principle that consumers have the right to ensure that their credit reports and related information accurately reflect their financial history. The FCRA mandates that upon receiving a dispute, the CRA must complete its investigation within a specific timeframe, typically 30 days. If the investigation reveals that the information is indeed inaccurate, the CRA is required to correct or remove it from the consumer's report.

This process supports consumer rights and helps maintain the integrity of the credit reporting system, ensuring that individuals are not unfairly impacted by erroneous information. Thus, conducting an investigation is a fundamental responsibility of the CRA when handling disputes.