Part 1 FRCA Basics

Equifax, TransUnion, Experian

Traditional national CRAs

Broad Language; Courts have also called for liberal construed when possible. Applies to both public and private data (mortgage information v. telephone numbers if going to be used for permissible purpose". The information must pertain to a consumer (an individual as opposed to a corporation or partnership.

Bearing on Consumers

a third party that provides oral or written reports to prospective employers about the prior work experience of applicants; an entity that regular researches the criminal records of job applicants and reports them is a CRa.

Background Screeners

expanded duties in response to dispute, increased obligatons of users, especially employers; imposed duties on furnishers

Consumer Credit Reporting Reform Act of 1996

FTC shares enforcement authority with the consumer financial protections bureau

Consumer Financial Protection Act of 2010 (CFPA)

any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumers credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected.

Consumer Report

entities for monetary gain compile information that can bear on the character or credit worthiness of consumer or assemble that information for a third party

Consumer Reporting Agencies

regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to a third party for a fee.

Consumer Reporting Agencies

consumers have the right to request copies of their consumer report or file dispute

Consumers

entities that have first hand contact with consumers who then furnish that information to credit agencies

Credit furnishers

covers w-2 employees, independent contractors, agents and volunteers.

Employment purposes

entity that makes employment decisions or credit decisions based on consumer report information

End-user

Purposes are credit or insurances, employment purposes. Employment purposes means evaluating consumer employment, promotion, reassignment or retention as an employee.

Establishing the Consumers' Eligibility

credit transactions in excess of $150,000 Underwriting life insurce in excess of $150,000 employment of individuals who do or could reasonable make more than $75,000 yearly.

Exceptions to Exclusions

the statute applies to much more than just credit reports and traditional credit reporting agencies; also applies to consumer reports which include background screening activities

FCRA is a misnomer

furnishers, cras, resellers, public records, consumers, end users

Industry players

arrest more than 7 years old adverse information, except convictions information older than 7 years. Some state laws may be more restrictive. Negative credit data like civil judgement, paid tax liens, collections accounts, older than 7 years These time limits apply only to negative info about consumers. Favorable info never goes stale End users can consider stale data if they get it from some source other than a CRA.

Info Excluded from Consumer Reports

includes third party interviews conducted by telephone, mail, and other electronic means does not include info gathered exclusively from the person who is the subject of the report does not include a report consisting only of the results of a drive by of the subject's residence does include unsolicited information if it otherwise meets the definition of an investigative consumer report

Investigative CRA Nuances

information on a consumer's character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on or with others who he is acquainted or who may have knowledge concerning any such items of information

Investigative Consumer Reports

a business that furnished information on a customer or employee in response to a single inquiry from another party

Isolated transactions

1. "by a consumer reporting agency" 2. "bearing on a consumer's credit worthiness...character..general reputation, personal characteristics, or mode of living" 3. used to establish a consumer's eligibility for credit or insurance" or for "employment purposes"

Key Elements

private litigants can bring lawsuits. For willful violations, a consumer can recover statutory damages of $100 to $1000 plus punitive damages and attorney's fees; for negligent violations a consumer can recover actual damages and attorney's fees

Private right of action

FTC has never enforced the FCRA against any government agency supplying public records. The rationale is that such agencies do not assemble such information for the purpose of generating consumer reports

Public Entities

sex offender registries, criminal records, dmv records

Public records

a business that simply delivers information without knowing the contents or keeping any information

Pure Conduit

specific types of CRA's; don't maintain databases of their own information. Submit a request to a traditional CRA on the behalf of an end-user that contracted with the reseller

Re-sellers

a business that regulatory compiles information on consumer as tenants, and provides such data to residential property owners for use in evaluating consumer rental applications is a CRA

Tenant Screeners

covered under section 604, because a landlord has a legitimate business need for a consumer report on a prospective tenant.

Tenant Screening

granted consumers right to free annual reports from CRAs ;required blocking of information placed on a consumer report as a result of identity theft

The Fair and Accurate Credit Transactions Act of 2003 (FACT Act)

Personal Knowledge, references, reports made among persons/entities under common control(subsidiary and parent corporations). reports made for some purpose other than credit, insurance, or employment (skip tracing, law enforcement, dating) Lab reports from a lab directly to an employer

Things that are not CRAs

credit reporting agencies

What were the principle targets?

1970

When was NAPBS originally enacted?