FCRA

When can legal actions to enforce liability be brought forward?

No later than two years AFTER the plaintiff discovers the violation OR five years after the date that the violation occurred, whichever is earlier.

Timeline exceptions

1. Consumer is applying for credit of 150K or more 2. Requesting life insurance with face amount of 150K or more 3. Applying for employment where salary is $75K or more

Types of penalties than can be assessed for violations of FCRA include:

1. Civil penalties and criminal penalities 2. Prison sentences 3. Monetary fines

What did the FACT Act add to FCRA?

1. New consumer protections and definitions (Fraud and activity duty alerts, identify theft, and identify theft reports) 2. Identity theft procedures, red flags, and marketing restrictions 3. Defined resellers as agencies that do not maintain a database but assemble and merger information from one or more nationwide consumer reporting agencies.

After 7 years, the following must not appear in the consumers credit report file:

1. Suits and juudgements 2. Paid tax liens from date of payment 3. Accounts placed for collection or charged to profit and loss 4. Records of arrest or conviction of crime 5. any other adverse information

Bank can use medical information as long as: (The financial exception)

1. The info is what is typically used for determining eligibility for credit (debts, expenses, etc) 2. Use of medical information is no less favorable than other similar information 3. Cant use physical, mental health or treatment history in the determination.

Civil penalties can be assessed for:

1. Violations involving willful non-compliance -Actual damages sustained by customer -punitive damages -Court costs and attorneys fees 2. Negligent non-compliance -Actual damages sustained by customer -Court costs and attorneys fees

When can an agency furnish reports to users of those reports?

1. court order 2. written instructions from the consumer 3. consideration of a request of credit (or renewal) 4. assist in collection of outstanding debt 5. employment purposes 6. underwriting insurance 7. edibility for licensing 8. legitimate business purpose of user (open a deposit account) These are called "permissible purposes"

FCRA was designed to ensure that collected information is:

1. fair and equitable 2. Confidential 3. Accurate and relevant 4. Properly used and disposed

How do regulators expect each furnisher to comply with FCRA?

1. maintain system capable of receiving info regarding disputes from CRAs 2. Conduct investgiation of dispute info (review all revent info and furniers owner info) 3. report results to CRA 4. Provide corrected info to every nationwide CRA that received the information (if applicable) 5. modify or delete disputed info

A consumer reporting agencyis any person or organization taht

1. regularly engages in practice of gathering or evaluating credit on consumers 2. provides this info to third parties 3. Receives fees or other compensation for provideing such reports OR 4. Provides reports and uses any means of interstate commerce for preparing or furnishing consumer reports.

When does the 7 years begin for adverse information and charge-offs?

180 days after the begining of the delinguency event.

Who enforces FCRA?

A banks regulator For the consumer reporting agencies, its the Federal Trade Commission

Active Duty Alert

A notification in a consumer's credit file to alert the user of a credit report that the consumer is active in the military and most likely deployed. Is part of the Red Flag Identity Theft program. Servicemembers name may not be included in consumer list to third parties comtemplating offering credit or insurance during the two year period following placement of the alert unless the request was initiatied by the consumer.

Investigative Consumer Reports (ICR)

A report similar to consumer report, but one that also provides information on the consumer's character, reputation and habits.

Initial Fraud Alert

An alert put on your credit file to help prevent additional identity theft. The alert stays on your file for 1 year unless the consumer asks for it to be removed.

Extended Fraud Alert

An alert that lasts for seven years which permits creditors to get your credit report only after they take steps to verify your identity

After 10 years the following must not appear in the consumers credit report file

Any sort of bankruptcy filing or related information

Nationwide CRA vs Reseller

CRA is Equifax, Experian or Transunion report provides but not maintainers are "resellers"

Nationwide Speciality Consumer Reporting Agency

Compile and maintain files on a nationwide basis relating to: 1. Medical records and payments 2. Residential or tenant history 3. Check writing history 4. Employment 5. Insurance Claims

FCRA Amendments

Consumer Credit Reform Act of 1996 Fair and Accurate Credit Transactions Act (FACT Act) of 2003

CRA

Credit Reporting Agency

Resellers

Defined resellers as agencies that do not maintain a database but assemble and merger information from one or more nationwide consumer reporting agencies Resellers furnish information (in the form of credit reports) to third parties.

Disposal of Consumer Information

Each bank that provides consumer info to third parties must contractually require these providers to properly dispose of such info

State Law vs Federal Law

FCRA is federal so it preempts inconsistent state law. Can only use state law if it gives additional protection above FCRA.

ICR Timing

If a request is received, bank must mail or deliver disclosure to consumer within 3 days after the request. (contains what the report will have and that they can request one) Bank must response to written request for ICR from consumer within 5 days.

Deposit accounts placed for collection and charged to profit and loss will report for only 5 years with a

Nationwide Speciality Consumer Reporting Agnecy

Can potential employers pull credit without written consent?

No.

Does the FCRA require any entities to use a consumer report in making its credit decisions?

No. It just governs how those reports should be used once they're requested. Also how the information is collected.

If a reporting agency receives a fraud or active military notification:

Then they must share the information with other nationwide reporting agencies and make sure the information is included with the consumers credit file

Prior to 1970

There were no laws regulating consumer privacy. FCRA was passed in 1970 making it the first.

Supervisory actions can be assessed against banks that dont

develop and maintain appropriate internal controls to ensure they properly dispose of all info from consumer credit report.

A bank that regularly furnishes information to a nationwide consumer reporting agency must provide a notice to a consumer....

prior to or not later than 30 days after the institution provides negative information to the agency.