FCRA Basic Certification
Examples of CRA
Traditional - Equifax, TransUnion, Experian Employment screeners Tenant Screeners
NOT Consumer Reports
Reports made on "personal knowledge" Reports made among persons/entities under "common control" (subsidiary and parent corporations) Reports made for purposes other than credit, insurance, or employment (skip tracing, law enforcement, dating) Lab reports from a lab directly to an employer.
Furnishers
Persons/entities that supply information to CRAs
End User
Persons/entities who intend to make use of the information contained in a consumer report.
Willful Violation
Plaintiff can recover actual damages or "statutory" damages of $100-1000 per violation, plus punitive damages
Inaccuracy, Failure to Follow Procedures
Plaintiff must prove both _ and _ in lawsuit.
Negligent Violation
Plaintiffs can recover actual damages
Permissible Purpose
Subpoena or court order Written instruction from the consumer A credit transaction with the consumer Employment Insurance underwriting Other legitimate needs (e.g. national security)
3 Key Elements of a Consumer Report
1. By a CRA 2. Bearing on a consumer's worthiness 3. Used to establish eligibility
5 Basic Duties of CRAs
1. Maintain "reasonable procedure" to assure "maximum possible accuracy" 2. Provide consumer reports to only those with a "permissible purpose" 3. Conduct "reinvestigation" in event of dispute 4. Make "disclosures" to consumers 5. Properly dispose of consumer info.
Reinvestigation
A CRA must make a good faith effort to determine the accuracy of the disputed item.A _ must be completed within 30 days or dispute will be removed. CRA required to consider any info submitted by the consumer. CRA can terminate frivolous disputes.
Resellers
A CRA that assembles and merges info contained in the database of another CRA(s) concerning any consumer for purposes of furnishing such information to any third party.
Employment Screeners
A third party that provides oral or written reports to prospective employers about the prior work experience of applicants
CRA required to provide consumer with
All info in their file The identity of the sources of that info the identity of each person who has obtained a copy of the report A summary of rights
Adverse Action
Any action that is _ to the interests of a consumer: Denial, cancellation, or unfavorable change in insurance Denial of employment Denial of rental application Denial of credit or offer of credit on less favorable terms
Consumer Report
Any written, oral, or other communication of any info by a CRA bearing on a consumer's credit worthiness, standing, capacity, character, general reputation, personal characteristics, or mode of living used or expected to be used or collected for establishing consumer's eligibility:
Excluded from Consumer Reports
Arrest records more than 7 years old. Negative credit data older than 7 years Bankruptcies can be reported for 10 years.
State Varients of the FCRA
At least 17 states have their own versions of the FCRA or statutes that touch on areas covered by the FCRA
Pre Adverse Action
Before taking adverse action the employer must provide the consumer with a copy of the report and a summary of the consumer's rights under the FCRA
5 Groups Affected by FCRA
CRAs End Users Furnishers Resellers Consumers
FCRA claims against End Users
Claim typically based on an employer's failure to follow the disclosure
Statute of Limitations
Claims must be brought the earlier of: Two years after the consumer learns of the violation, or five years after the violation occurs
Completeness or Accuracy
Consumers are permitted to dispute the _ or _ of any information in their file.
NOT Permissible
Curiosity Litigation Marketing
Consumer Reporting Agency
Engages in the assembly or evaluating of consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties.
Employment Purposes
Evaluating a consumer for employment, promotion, reassignment, or retention as an employee.
Potential Plaintiffs
FTC/CFPB Individual Consumers
Reasonable Procedure
If a CRA reports an item of information that turns out to be inaccurate, it does not violate the FCRA if it has established _ in reporting the item.
Consumers
Individuals protected under the FCRA
Investigative Consumer Reports
Information on a consumer's character, general reputation, personal characteristics, or mode of living obtained through personal interviews with neighbors, friends, or associates of the consumer reported on.
NOT CRAs
Isolated transactions Conduit functions Public entities
Highly confidential information
Must be disposed of by: Burning, pulverizing, or shredding Destroying or erasing electronic data A contract with a records disposal company.
Class Action
One or more plaintiffs brings a lawsuit on behalf of a group or "class" of people.
Post Adverse Action
Provide notice of the adverse action to the consumer Provide the consumer with contact info of the CRA Provide the consumer with a summary of rights
Tenant Screeners
Regularly compiles information on consumers as tenants, and provides such data to residential property owners for use in evaluating consumer rental applications
Federal District Courts
Where FCRA disputes are usually brought.
Resellers
_ are CRAs for purposes of a claim. They can be sued for inaccurate reporting.
Furnishers
_ cannot be sued for violations because they are not CRAs _ cannot be sued for furnishing inaccurate information about a consumer to a CRA _ can be sued for failing to conduct a proper or timely reinvestigation or failing to correct inaccurate information.