Fair Credit Reporting Act

Civil Liability for Negligent Noncompliance

Negligent failure to comply with the law may result in the payment of actual damages, costs, and attorney's fees to the injured consumer.

Civil Liability for Willful Noncompliance

Any person who willfully fails to comply with consumer-protection provisions of FCRA is liable to the injured consumer for actual damages of not less than $100 and not more than $1,000, punitive damages, costs of bringing the action, and attorney's fees.

Practices Prohibited by FCRA

--prohibits a CRA from furnishing a consumer report for any reason other than a permissible purpose. --prohibits those who furnish information to a CRA from knowingly providing inaccurate information. --prohibits the release of a consumer report without the written permission of the consumer. --No CRA can write a consumer report containing outdated negative financial information such as bankruptcies over ten years old and other negative information such as paid tax liens and civil judgments that are more than seven years old unless the consumer report relates to a credit transaction involving a principal amount of $150,000 or more. --CRAs cannot release disputed information in a consumer report without indicating that the consumer disputes the accuracy and completeness of the information.

Adverse Action

Adverse Action has the same meaning that it has under ECOA, and also means any denial or unfavorable change in insurance coverage, or a denial of employment based on a consumer report.

Criminal Penalties for Obtaining Information under False Pretenses

Any person who obtains information about a consumer under false pretenses will be fined and/or imprisoned for not more than two years.

CRA

Consumer Reporting Agency Any person who regularly engages for fees or on a cooperative nonprofit basis in the practice of assembling or evaluating of consumer credit information in order to provide consumer reports to third parties.

Covered Transactions

FCRA applies to any transaction that involves the use of credit reports, consumer investigatory reports, and employment background checks.

FCRA

Fair Credit Reporting Act 1970 - Regulation V To ensure the accuracy, fairness, and privacy of consumers' personal information that is assembled and used by consumer reporting agencies

Notice of Dispute

If a consumer disputes the accuracy and completeness of information provided by a furnisher, the furnisher cannot report the disputed information to a CRA without providing notice of the dispute.

Exempt Disclosures

The privacy requirements do not apply to disclosures of limited information to government agencies, to the FBI and to counter-terrorism investigations.

Duties after Receipt of Notice of Dispute

Upon receipt of a notice of dispute from a CRA, a furnisher must conduct an investigation, report the results to the CRA that provided notice of the dispute, report any inaccuracies to all CRAs that received the inaccurate information, and delete the inaccurate information. Furnishers have 30 days from the CRA's receipt of a dispute to investigate the dispute and rectify any inaccuracies.

Certification of Permissible Purpose

Users must provide a Consumer Reporting Agency with a certification that states the permissible purpose for which the user is requesting the consumer report. Permissible purposes include consumer's request for a credit report required by a mortgage lender. Another permissible purpose is to determine a consumer's eligibility for a license, such as the loan officer license under certain state laws.

Notification of Adverse Action

When a user takes any type of adverse action based on information in a consumer report, the user must provide the consumer with notification which includes contact information for the CRA that provided the report. A statement that the CRA did not make the adverse decision and must advise the consumer of the right to obtain a free disclosure of his/her file and of the right to contact the CRA to dispute the accuracy and completeness of the report.

Notice Regarding Delinquencies

A furnisher that reports information on a delinquent account must provide the CRA with the month and year of the commencement of the delinquency that immediately precedes an action for collection.

Regulatory Agency

CFPB Consumer Financial Protection Bureau However, the FTC retains some rulemaking and enforcement authority

CRA Notification to Users

CRAs must provide notices to any person who regularly and in the ordinary course of business furnishes information to a CRA and to any person who receives and uses a consumer report.

Criminal Penalties for Unauthorized Disclosures by Officers and Employees

Officers or employees of a CRA who knowingly and willfully provide information about a consumer to a person not authorized to receive the information will be fined and/or imprisoned for no more than two years.

Notification of Adverse Action Based on Information from Affiliates

If adverse action is based on information from an entity that is affiliated with the user by common ownership or control, the user must notify the consumer of the adverse action and of the right to obtain a disclosure of the nature of the information relied on in taking the adverse action.

CRA Disclosures to Consumers

If requested by a consumer, CRAs must clearly and accurately disclose all information in the consumer's file, the sources of the information, and the identification of each person that procured a consumer report.

Notification to CRAs of Corrections

If the furnisher of information regularly and in the ordinary course of business provides information to CRAs and determines that the information provided is not complete or accurate, the furnisher has a duty to correct the information and to provide the corrections to all CRAs that received inaccurate information.