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.