Laws We Use

How do we repair your credit?

Is it legal?

We actually USE THE LAW to fix your credit. Truly Fair Credit Repair does not need to lie or even be sneaking to fix your credit. Our credit restorations actually just make your creditors and the credit bureaus themselves follow the laws that are in place to protect you.

A sampling of these laws are:

The FCRA:
The Fair Credit Reporting Act (FCRA) was enacted in 1970 to promote fairness, accuracy and the privacy of personal information reported to credit bureaus by
creditors and others. The FCRA allows a consumer to challenge the information on his or her credit report on the basis of “completeness and accuracy.” The credit bureaus are required to complete the investigation within a “reasonable period of time.” This time period has been set at thirty days.
If, after an investigation by the credit bureau, the disputed information “is found to be inaccurate or can no longer be verified, the [credit bureau] shall promptly delete such information.” In theory, the disputation process should be simple, but many consumers quickly discover that creditors and debt collectors can make the process more difficult than they imagined.
Creditors routinely charge higher rates of interest to those with negative credit histories, so sloppy credit reporting may serve to maximize their profits, a circumstance that can make the process of credit repair a difficult and frustrating experience for most consumers.
The Fair Credit Reporting Act
As a public service, the staff of the Federal Trade Commission (FTC) has prepared the following complete text of the Fair Credit Reporting Act (FCRA), 15
U.S.C. § 1681 et seq. Although staff generally followed the format of the U.S. Code as published by the Government Printing Office, the format of this text
does differ in minor ways from the Code (and from West’s U.S. Code Annotated).For example, this version uses FCRA section numbers (§§ 601-625) in the
headings. (The relevant U.S. Code citation is included with each section heading and each reference to the FCRA in the text.) Although the staff has made every effort to transcribe the statutory material accurately, this compendium is intended only as a convenience for the public and not a substitute for the text in the U. S. Code. The Commission’s website (www.ftc.gov) posted this document on October 20, 2006.
This version of the FCRA includes the amendments to the FCRA set forth in the Consumer Credit Reporting Reform Act of 1996 (Public Law 104-208, the Omnibus Consolidated Appropriations Act for Fiscal Year 1997, Title II, Subtitle D, Chapter 1), Section 311 of the Intelligence Authorization for Fiscal Year 1998 (Public Law 105-107), the Consumer Reporting Employment Clarification Act of 1998 (Public Law 105-347), Section 506 of the Gramm-Leach-Bliley Act (Public Law 106-102), Sections 358(G) and 505(C) of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act) (Public Law 107-56), the Fair and Accurate Credit Transactions Act of 2003 (FACT Act) (Public Law 108-159), and Section 719 of the Financial Services Regulatory
Relief Act of 2006 (Public Law 109-351).
The provisions added to the FCRA by the FACT Act became effective at different times. In some cases, the provision includes its own effective date. In other cases, the FACT Act provides that the effective dates be prescribed by the FTC and Federal Reserve Board. See 16 CFR Part 602. (69 Fed. Reg. 6526; February 11, 2004) (69 Fed. Reg. 29061; May 20, 2004).
601.
This title may be cited as the “Fair Credit Reporting Act”.
602.
Congressional findings and statement of purpose [15 U.S.C. § 1681]
(a)Accuracy and fairness of credit reporting. The Congress makes the following findings:
(1)The banking system is dependent upon fair and accurate credit reporting. Inaccurate credit reports directly impair the efficiency of the banking system, and unfair
credit reporting methods undermine the public confidence which is essential to the continued functioning of the banking system.
(2)An elaborate mechanism has been developed for investigating and evaluating the credit worthiness, credit standing, credit capacity, character, and general
reputation of consumers.
(3)Consumer reporting agencies have assumed a vital role in assembling and evaluating consumer credit and other information on consumers.
(4)There is a need to insure that consumer reporting agencies exercise their grave responsibilities with fairness, impartiality, and a respect for the consumer’s
right to privacy.
(b)Reasonable procedures. It is the purpose of this title to require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information in accordance with the requirements of this title.
603.
Definitions; rules of construction [15 U.S.C. § 1681a]
(a)Definitions and rules of construction set forth in this section are applicable for the purposes of this title.
(b)The term “person” means any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.
(c)The term “consumer” means an individual.
(d)Consumer Report
(1)In general. The term “consumer report” means any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s 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 in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility for
(A)credit or insurance to be used primarily for personal, family, or household purposes;
(B)employment purposes; or
(C)any other purpose authorized under section 604 [§ 1681b].
(2)Exclusions. Except as provided in paragraph (3), the term “consumer report” does not include
(A)subject to section 624, any
(i)report containing information solely as to transactions or experiences between the consumer and the person making the report;
(ii)communication of that information among persons related by common ownership or affiliated by corporate control; or
(iii)communication of other information among persons related by common ownership or affiliated by corporate control, if it is clearly and conspicuously disclosed to the consumer that the information may be communicated among such persons and the consumer is given the opportunity, before the time that the information is initially communicated, to direct that such information not be communicated among such persons;
(B)any authorization or approval of a specific extension of credit directly or indirectly by the issuer of a credit card or similar device;
(C)any report in which a person who has been requested by a third party to make a specific extension of credit directly or indirectly to a consumer conveys his
or her decision with respect to such request, if the third party advises the consumer of the name and address of the person to whom the request was made,
and such person makes the disclosures to the consumer required under section 615 [§ 1681m]; or
(D)a communication described in subsection (o) or (x).
(3)Restriction on sharing of medical information. Except for information or any communication of information disclosed as provided in section 604(g)(3), the exclusions in paragraph (2) shall not apply with respect to information disclosed to any person related by common ownership or affiliated by corporate control, if the information is–
(A)medical information;
(B)an individualized list or description based on the payment transactions of the consumer for medical products or services; or
(C)an aggregate list of identified consumers based on payment transactions for medical products or services.
(e)The term “investigative consumer report” means a consumer report or portion thereof in which 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 with whom he is acquainted or who may have knowledge
concerning any such items of information. However, such information shall not include specific factual information on a consumer’s credit record obtained directly from a creditor of the consumer or from a consumer reporting agency when such information was obtained directly from a creditor of the consumer or from the consumer.
(f)The term “consumer reporting agency” means any person which, for monetary fees, dues, or on a cooperative nonprofit basis, 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 third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.
(g)The term “file,” when used in connection with information on any consumer, means all of the information on that consumer recorded and retained by a consumer reporting agency regardless of how the information is stored.
(h)The term “employment purposes” when used in connection with a consumer report means a report used for the purpose of evaluating a consumer for
employment, promotion, reassignment or retention as an employee.
(i)The term “medical information” —
(1)means information or data, whether oral or recorded, in any form or medium, created by or derived from a health care provider or the consumer, that relates to–
(A)the past, present, or future physical, mental, or behavioral health or condition of an individual;
(B)the provision of health care to an individual; or
(C)the payment for the provision of health care to an individual.
(2)does not include the age or gender of a consumer, demographic information about the consumer, including a consumer’s residence address or e-mail address, or any
other information about a consumer that does not relate to the physical, mental, or behavioral health or condition of a consumer, including the existence or value of any insurance policy.
(j)Definitions Relating to Child Support Obligations
(1)The
“overdue support” has the meaning given to such term in section
666(e) of title 42 [Social Security Act, 42 U.S.C. § 666(e)].
(2)The
term “State or local child support enforcement agency” means a State
or local agency which administers a State or local program for establishing and
enforcing child support obligations.
(k)Adverse
Action
(1)Actions included. The term
“adverse action”
(A)has
the same meaning as in section 701(d)(6) of the Equal Credit Opportunity Act;
and
(B)means
(i)a
denial or cancellation of, an increase in any charge for, or a reduction or
other adverse or unfavorable change in the terms of coverage or amount of, any
insurance, existing or applied for, in connection with the underwriting of
insurance;
(ii)a
denial of employment or any other decision for employment purposes that
adversely affects any current or prospective employee;
(iii)a
denial or cancellation of, an increase in any charge for, or any other adverse
or unfavorable change in the terms of, any license or benefit described in
section 604(a)(3)(D) [§ 1681b]; and
(iv)an
action taken or determination that is
(I)made
in connection with an application that was made by, or a transaction that was
initiated by, any consumer, or in connection with a review of an account under
section 604(a)(3)(F)(ii)[§ 1681b]; and
(II)adverse
to the interests of the consumer.
(2)Applicable findings, decisions, commentary, and
orders. For purposes of any determination of whether an action is
an adverse action under paragraph (1)(A), all appropriate final findings,
decisions, commentary, and orders issued under section 701(d)(6) of the Equal
Credit Opportunity Act by the Board of Governors of the Federal Reserve System
or any court shall apply.
(l)The
term “firm offer of credit or insurance” means any offer of credit or
insurance to a consumer that will be honored if the consumer is determined,
based on information in a consumer report on the consumer, to meet the specific
criteria used to select the consumer for the offer, except that the offer may
be further conditioned on one or more of the following:
(1)The
consumer being determined, based on information in the consumer’s application
for the credit or insurance, to meet specific criteria bearing on credit
worthiness or insurability, as applicable, that are established
(A)before
selection of the consumer for the offer; and
(B)for
the purpose of determining whether to extend credit or insurance pursuant to
the offer.
(2)Verification<
(A)that
the consumer continues to meet the specific criteria used to select the
consumer for the offer, by using information in a consumer report on the
consumer, information in the consumer’s application for the credit or
insurance, or other information bearing on the credit worthiness or
insurability of the consumer; or
(B)of
the information in the consumer’s application for the credit or insurance, to
determine that the consumer meets the specific criteria bearing on credit
worthiness or insurability.
(3)The
consumer furnishing any collateral that is a requirement for the extension of
the credit or insurance that was
(A)established
before selection of the consumer for the offer of credit or insurance; and
(B)disclosed
to the consumer in the offer of credit or insurance.
(m)The
term “credit or insurance transaction that is not initiated by the
consumer” does not include the use of a consumer report by a person with
which the consumer has an account or insurance policy, for purposes of
(1)reviewing
the account or insurance policy; or
(2)collecting
the account.
(n)The
term “State” means any State, the Commonwealth of Puerto Rico, the
District of Columbia, and any territory or possession of the United States.
(o)Excluded communications. A
communication is described in this subsection if it is a communication
(1)that,
but for subsection (d)(2)(D), would be an investigative consumer report;
(2)that
is made to a prospective employer for the purpose of
(A)procuring
an employee for the employer; or
(B)procuring
an opportunity for a natural person to work for the employer;
(3)that
is made by a person who regularly performs such procurement;
(4)that
is not used by any person for any purpose other than a purpose described in
subparagraph (A) or (B) of paragraph (2); and
(5)with
respect to which
(A)the
consumer who is the subject of the communication
(i)consents
orally or in writing to the nature and scope of the communication, before the
collection of any information for the purpose of making the communication;
(ii)consents
orally or in writing to the making of the communication to a prospective
employer, before the making of the communication; and
(iii)in
the case of consent under clause (i) or (ii) given orally, is provided written
confirmation of that consent by the person making the communication, not later
than 3 business days after the receipt of the consent by that person;
(B)the
person who makes the communication does not, for the purpose of making the
communication, make any inquiry that if made by a prospective employer of the
consumer who is the subject of the communication would violate any applicable
Federal or State equal employment opportunity law or regulation; and
(C)the
person who makes the communication
(i)discloses
in writing to the consumer who is the subject of the communication, not later
than 5 business days after receiving any request from the consumer for such
disclosure, the nature and substance of all information in the consumer’s file
at the time of the request, except that the sources of any information that is
acquired solely for use in making the communication and is actually used for no
other purpose, need not be disclosed other than under appropriate discovery
procedures in any court of competent jurisdiction in which an action is
brought; and
(ii)notifies
the consumer who is the subject of the communication, in writing, of the
consumer’s right to request the information described in clause (i).
(p)The
term “consumer reporting agency that compiles and maintains files on
consumers on a nationwide basis” means a consumer reporting agency that
regularly engages in the practice of assembling or evaluating, and maintaining,
for the purpose of furnishing consumer reports to third parties bearing on a
consumer’s credit worthiness, credit standing, or credit capacity, each of the
following regarding consumers residing nationwide:
(1)Public
record information.
(2)Credit
account information from persons who furnish that information regularly and in
the ordinary course of business.
(q)Definitions
relating to fraud alerts.
(1)The
term “active duty military consumer” means a consumer in military
service who–
(A)is
on active duty (as defined in section 101(d)(1) of title 10, United States
Code) or is a reservist performing duty under a call or order to active duty
under a provision of law referred to in section 101(a)(13) of title 10, United
States Code; and
(B)is
assigned to service away from the usual duty station of the consumer.
(2)The
terms “fraud alert” and “active duty alert” mean a
statement in the file of a consumer that–
(A)notifies
all prospective users of a consumer report relating to the consumer that the
consumer may be a victim of fraud, including identity theft, or is an active
duty military consumer, as applicable; and
(B)is
presented in a manner that facilitates a clear and conspicuous view of the
statement described in subparagraph (A) by any person requesting such consumer
report.
(3)The
term “identity theft” means a fraud committed using the identifying
information of another person, subject to such further definition as the
Commission may prescribe, by regulation.
See also 16 CFR Part 603.2
69 Fed. Reg. 63922 (11/03/04)
(4)The
term “identity theft report” has the meaning given that term by rule
of the Commission, and means, at a minimum, a report–
(A)that
alleges an identity theft;
(B)that
is a copy of an official, valid report filed by a consumer with an appropriate
Federal, State, or local law enforcement agency, including the United States
Postal Inspection Service, or such other government agency deemed appropriate
by the Commission; and
(C)the
filing of which subjects the person filing the report to criminal penalties
relating to the filing of false information if, in fact, the information in the
report is false.
See also 16 CFR Part 603.3
69 Fed. Reg. 63922 (11/03/04)
(5)The
term “new credit plan” means a new account under an open end credit
plan (as defined in section 103(i) of the Truth in Lending Act) or a new credit
transaction not under an open end credit plan.
(r)Credit
and Debit Related Terms
(1)The
term “card issuer” means–
(A)a
credit card issuer, in the case of a credit card; and
(B)a
debit card issuer, in the case of a debit card.
(2)The
term “credit card” has the same meaning as in section 103 of the
Truth in Lending Act.
(3)The
term “debit card” means any card issued by a financial institution to
a consumer for use in initiating an electronic fund transfer from the account
of the consumer at such financial institution, for the purpose of transferring
money between accounts or obtaining money, property, labor, or services.
(4)The
terms “account” and “electronic fund transfer” have the
same meanings as in section 903 of the Electronic Fund Transfer Act.
(5)The
terms “credit” and “creditor” have the same meanings as in
section 702 of the Equal Credit Opportunity Act.
(s)The
term “Federal banking agency” has the same meaning as in section 3 of
the Federal Deposit Insurance Act.
(t)The
term “financial institution” means a State or National bank, a State
or Federal savings and loan association, a mutual savings bank, a State or
Federal credit union, or any other person that, directly or indirectly, holds a
transaction account (as defined in section 19(b) of the Federal Reserve Act)
belonging to a consumer.
(u)The
term “reseller” means a consumer reporting agency that–
(1)assembles
and merges information contained in the database of another consumer reporting
agency or multiple consumer reporting agencies concerning any consumer for
purposes of furnishing such information to any third party, to the extent of
such activities; and
(2)does
not maintain a database of the assembled or merged information from which new
consumer reports are produced.
(v)The
term “Commission” means the Federal Trade Commission.
(w)The
term “nationwide specialty consumer reporting agency” means a
consumer reporting agency that compiles and maintains files on consumers on a
nationwide basis relating to–
(1)medical
records or payments;
(2)residential
or tenant history;
(3)check
writing history;
(4)employment
history; or
(5)insurance
claims.
(x)Exclusion
of Certain Communications for Employee Investigations
(1)A
communication is described in this subsection if–
(A)but
for subsection (d)(2)(D), the communication would be a consumer report;
(B)the
communication is made to an employer in connection with an investigation of-
(i)suspected
misconduct relating to employment; or
(ii)compliance
with Federal, State, or local laws and regulations, the rules of a
self-regulatory organization, or any preexisting written policies of the
employer;
(C)the
communication is not made for the purpose of investigating a consumer’s credit
worthiness, credit standing, or credit capacity; and
(D)the
communication is not provided to any person except–
(i)to
the employer or an agent of the employer;
(ii)to
any Federal or State officer, agency, or department, or any officer, agency, or
department of a unit of general local government;
(iii)to
any self-regulatory organization with regulatory authority over the activities
of the employer or employee;
(iv)as
otherwise required by law; or
(v)pursuant
to section 608.
(2)Subsequent disclosure. After taking
any adverse action based in whole or in part on a communication described in
paragraph (1), the employer shall disclose to the consumer a summary containing
the nature and substance of the communication upon which the adverse action is
based, except that the sources of information acquired solely for use in
preparing what would be but for subsection (d)(2)(D) an investigative consumer
report need not be disclosed.
(3)For
purposes of this subsection, the term “self-regulatory organization”
includes any self-regulatory organization (as defined in section 3(a)(26) of
the Securities Exchange Act of 1934), any entity established under title I of
the Sarbanes-Oxley Act of 2002, any board of trade designated by the Commodity
Futures Trading Commission, and any futures association registered with such Commission.
604.
Permissible purposes of consumer reports [15 U.S.C. § 1681b]
(a)In general. Subject to subsection
(c), any consumer reporting agency may furnish a consumer report under the
following circumstances and no other:
(1)In
response to the order of a court having jurisdiction to issue such an order, or
a subpoena issued in connection with proceedings before a Federal grand jury.
(2)In
accordance with the written instructions of the consumer to whom it relates.
(3)To
a person which it has reason to believe
(A)intends
to use the information in connection with a credit transaction involving the
consumer on whom the information is to be furnished and involving the extension
of credit to, or review or collection of an account of, the consumer; or
(B)intends
to use the information for employment purposes; or
(C)intends
to use the information in connection with the underwriting of insurance
involving the consumer; or
(D)intends
to use the information in connection with a determination of the consumer’s
eligibility for a license or other benefit granted by a governmental
instrumentality required by law to consider an applicant’s financial
responsibility or status; or
(E)intends
to use the information, as a potential investor or servicer, or current
insurer, in connection with a valuation of, or an assessment of the credit or
prepayment risks associated with, an existing credit obligation; or
(F)otherwise
has a legitimate business need for the information
(i)in
connection with a business transaction that is initiated by the consumer; or
(ii)to
review an account to determine whether the consumer continues to meet the terms
of the account.
(4)In
response to a request by the head of a State or local child support enforcement
agency (or a State or local government official authorized by the head of such
an agency), if the person making the request certifies to the consumer
reporting agency that
(A)the
consumer report is needed for the purpose of establishing an individual’s
capacity to make child support payments or determining the appropriate level of
such payments;
(B)the
paternity of the consumer for the child to which the obligation relates has
been established or acknowledged by the consumer in accordance with State laws
under which the obligation arises (if required by those laws);
(C)the
person has provided at least 10 days’ prior notice to the consumer whose report
is requested, by certified or registered mail to the last known address of the
consumer, that the report will be requested; and
(D)the
consumer report will be kept confidential, will be used solely for a purpose
described in subparagraph (A), and will not be used in connection with any
other civil, administrative, or criminal proceeding, or for any other purpose.
(5)To
an agency administering a State plan under Section 454 of the Social Security
Act (42 U.S.C. § 654) for use to set an initial or modified child support
award.
(6)To
the Federal Deposit Insurance Corporation or the National Credit Union
Administration as part of its preparation for its appointment or as part of its
exercise of powers, as conservator, receiver, or liquidating agent for an
insured depository institution or insured credit union under the Federal
Deposit Insurance Act or the Federal Credit Union Act, or other applicable Federal
or State law, or in connection with the resolution or liquidation of a failed
or failing insured depository institution or insured credit union, as
applicable.
(b)Conditions
for Furnishing and Using Consumer Reports for Employment Purposes.
(1)Certification from user. A consumer
reporting agency may furnish a consumer report for employment purposes only if
(A)the
person who obtains such report from the agency certifies to the agency that
(i)the
person has complied with paragraph (2) with respect to the consumer report, and
the person will comply with paragraph (3) with respect to the consumer report
if paragraph (3) becomes applicable; and
(ii)information
from the consumer report will not be used in violation of any applicable
Federal or State equal employment opportunity law or regulation; and
(B)the
consumer reporting agency provides with the report, or has previously provided,
a summary of the consumer’s rights under this title, as prescribed by the
Federal Trade Commission under section 609(c)(3) [§ 1681g].
(2)Disclosure
to Consumer.
(A)In general. Except as provided in
subparagraph (B), a person may not procure a consumer report, or cause a
consumer report to be procured, for employment purposes with respect to any
consumer, unless–
(i)a
clear and conspicuous disclosure has been made in writing to the consumer at
any time before the report is procured or caused to be procured, in a document
that consists solely of the disclosure, that a consumer report may be obtained
for employment purposes; and
(ii)the
consumer has authorized in writing (which authorization may be made on the
document referred to in clause (i)) the procurement of the report by that
person.
(B)Application by mail, telephone, computer, or
other similar means. If a consumer described in subparagraph (C)
applies for employment by mail, telephone, computer, or other similar means, at
any time before a consumer report is procured or caused to be procured in
connection with that application-
(i)the
person who procures the consumer report on the consumer for employment purposes
shall provide to the consumer, by oral, written, or electronic means, notice
that a consumer report may be obtained for employment purposes, and a summary
of the consumer’s rights under section 615(a)(3); and
(ii)the
consumer shall have consented, orally, in writing, or electronically to the
procurement of the report by that person.
(C)Scope. Subparagraph (B) shall apply
to a person procuring a consumer report on a consumer in connection with the
consumer’s application for employment only if–
(i)the
consumer is applying for a position over which the Secretary of Transportation
has the power to establish qualifications and maximum hours of service pursuant
to the provisions of section 31502 of title 49, or a position subject to safety
regulation by a State transportation agency; and
(ii)as
of the time at which the person procures the report or causes the report to be
procured the only interaction between the consumer and the person in connection
with that employment application has been by mail, telephone, computer, or
other similar means.
(3)Conditions
on use for adverse actions.
(A)In general. Except as provided in
subparagraph (B), in using a consumer report for employment purposes, before
taking any adverse action based in whole or in part on the report, the person
intending to take such adverse action shall provide to the consumer to whom the
report relates–
(i)a
copy of the report; and
(ii)a
description in writing of the rights of the consumer under this title, as prescribed
by the Federal Trade Commission under section 609(c)(3).1
(B)Application
by mail, telephone, computer, or other similar means.
(i)If
a consumer described in subparagraph (C) applies for employment by mail,
telephone, computer, or other similar means, and if a person who has procured a
consumer report on the consumer for employment purposes takes adverse action on
the employment application based in whole or in part on the report, then the
person must provide to the consumer to whom the report relates, in lieu of the
notices required under subparagraph (A) of this section and under section
615(a), within 3 business days of taking such action, an oral, written or
electronic notification–
(I)that
adverse action has been taken based in whole or in part on a consumer report
received from a consumer reporting agency;
(II)of
the name, address and telephone number of the consumer reporting agency that
furnished the consumer report (including a toll-free telephone number
established by the agency if the agency compiles and maintains files on
consumers on a nationwide basis);
(III)that
the consumer reporting agency did not make the decision to take the adverse
action and is unable to provide to the consumer the specific reasons why the
adverse action was taken; and
(IV)that
the consumer may, upon providing proper identification, request a free copy of
a report and may dispute with the consumer reporting agency the accuracy or
completeness of any information in a report.
(ii)If,
under clause (B)(i)(IV), the consumer requests a copy of a consumer report from
the person who procured the report, then, within 3 business days of receiving
the consumer’s request, together with proper identification, the person must
send or provide to the consumer a copy of a report and a copy of the consumer’s
rights as prescribed by the Federal Trade Commission under section 609(c)(3).
(C)Scope. Subparagraph (B) shall apply
to a person procuring a consumer report on a consumer in connection with the
consumer’s application for employment only if–
(i)the
consumer is applying for a position over which the Secretary of Transportation
has the power to establish qualifications and maximum hours of service pursuant
to the provisions of section 31502 of title 49, or a position subject to safety
regulation by a State transportation agency; and
(ii)as
of the time at which the person procures the report or causes the report to be
procured the only interaction between the consumer and the person in connection
with that employment application has been by mail, telephone, computer, or
other similar means.
(4)Exception
for national security investigations.
(A)In general. In the case of an
agency or department of the United States Government which seeks to obtain and
use a consumer report for employment purposes, paragraph (3) shall not apply to
any adverse action by such agency or department which is based in part on such
consumer report, if the head of such agency or department makes a written
finding that-
(i)the
consumer report is relevant to a national security investigation of such agency
or department;
(ii)the
investigation is within the jurisdiction of such agency or department;
(iii)there
is reason to believe that compliance with paragraph (3) will-
(I)endanger
the life or physical safety of any person;
(II)result
in flight from prosecution;
(III)result
in the destruction of, or tampering with, evidence relevant to the
investigation;
(IV)result
in the intimidation of a potential witness relevant to the investigation;
(V)result
in the compromise of classified information; or
(VI)otherwise
seriously jeopardize or unduly delay the investigation or another official
proceeding.
(B)Notification of consumer upon conclusion of investigation.
Upon the conclusion of a national security investigation described in
subparagraph (A), or upon the determination that the exception under
subparagraph (A) is no longer required for the reasons set forth in such
subparagraph, the official exercising the authority in such subparagraph shall
provide to the consumer who is the subject of the consumer report with regard
to which such finding was made–
(i)a
copy of such consumer report with any classified information redacted as
necessary;
(ii)notice
of any adverse action which is based, in part, on the consumer report; and
(iii)the
identification with reasonable specificity of the nature of the investigation
for which the consumer report was sought.
(C)Delegation by head of agency or department.
For purposes of subparagraphs (A) and (B), the head of any agency or department
of the United States Government may delegate his or her authorities under this
paragraph to an official of such agency or department who has personnel
security responsibilities and is a member of the Senior Executive Service or
equivalent civilian or military rank.
(D)Report to the Congress. Not later
than January 31 of each year, the head of each agency and department of the
United States Government that exercised authority under this paragraph during
the preceding year shall submit a report to the Congress on the number of times
the department or agency exercised such authority during the year.
(E)Definitions. For purposes of this
paragraph, the following definitions shall apply:
(i)The
term “classified information” means information that is protected
from unauthorized disclosure under Executive Order No. 12958 or successor
orders.
(ii)The
term “national security investigation” means any official inquiry by
an agency or department of the United States Government to determine the
eligibility of a consumer to receive access or continued access to classified
information or to determine whether classified information has been lost or
compromised.
(c)Furnishing
reports in connection with credit or insurance transactions that are not
initiated by the consumer.
(1)In general. A consumer reporting
agency may furnish a consumer report relating to any consumer pursuant to
subparagraph (A) or (C) of subsection (a)(3) in connection with any credit or
insurance transaction that is not initiated by the consumer only if
(A)the
consumer authorizes the agency to provide such report to such person; or
(B)(i)the
transaction consists of a firm offer of credit or insurance;
(ii)the
consumer reporting agency has complied with subsection (e); and
(iii)there
is not in effect an election by the consumer, made in accordance with
subsection (e), to have the consumer’s name and address excluded from lists of
names provided by the agency pursuant to this paragraph.
(2)Limits on information received under paragraph
(1)(B). A person may receive pursuant to paragraph (1)(B) only
(A)the
name and address of a consumer;
(B)an
identifier that is not unique to the consumer and that is used by the person
solely for the purpose of verifying the identity of the consumer; and
(C)other
information pertaining to a consumer that does not identify the relationship or
experience of the consumer with respect to a particular creditor or other
entity.
(3)Information regarding inquiries.
Except as provided in section 609(a)(5) [§1681g], a consumer reporting agency
shall not furnish to any person a record of inquiries in connection with a
credit or insurance transaction that is not initiated by a consumer.
(d)Reserved.
(e)Election
of consumer to be excluded from lists.
(1)In general. A consumer may elect to
have the consumer’s name and address excluded from any list provided by a
consumer reporting agency under subsection (c)(1)(B) in connection with a
credit or insurance transaction that is not initiated by the consumer, by
notifying the agency in accordance with paragraph (2) that the consumer does
not consent to any use of a consumer report relating to the consumer in
connection with any credit or insurance transaction that is not initiated by
the consumer.
(2)Manner of notification. A consumer
shall notify a consumer reporting agency under paragraph (1)
(A)through
the notification system maintained by the agency under paragraph (5); or
(B)by
submitting to the agency a signed notice of election form issued by the agency
for purposes of this subparagraph.
(3)Response of agency after notification through
system. Upon receipt of notification of the election of a consumer
under paragraph (1) through the notification system maintained by the agency
under paragraph (5), a consumer reporting agency shall
(A)inform
the consumer that the election is effective only for the 5-year period
following the election if the consumer does not submit to the agency a signed
notice of election form issued by the agency for purposes of paragraph (2)(B);
and
(B)provide
to the consumer a notice of election form, if requested by the consumer, not
later than 5 business days after receipt of the notification of the election
through the system established under paragraph (5), in the case of a request
made at the time the consumer provides notification through the system.
(4)Effectiveness of election. An
election of a consumer under paragraph (1)
(A)shall
be effective with respect to a consumer reporting agency beginning 5 business
days after the date on which the consumer notifies the agency in accordance
with paragraph (2);
(B)shall
be effective with respect to a consumer reporting agency
(i)subject
to subparagraph (C), during the 5-year period beginning 5 business days after
the date on which the consumer notifies the agency of the election, in the case
of an election for which a consumer notifies the agency only in accordance with
paragraph (2)(A); or
(ii)until
the consumer notifies the agency under subparagraph (C), in the case of an
election for which a consumer notifies the agency in accordance with paragraph
(2)(B);
(C)shall
not be effective after the date on which the consumer notifies the agency,
through the notification system established by the agency under paragraph (5),
that the election is no longer effective; and
(D)shall
be effective with respect to each affiliate of the agency.
(5)Notification
System
(A)In general. Each consumer reporting
agency that, under subsection (c)(1)(B), furnishes a consumer report in
connection with a credit or insurance transaction that is not initiated by a
consumer, shall
(i)establish
and maintain a notification system, including a toll-free telephone number,
which permits any consumer whose consumer report is maintained by the agency to
notify the agency, with appropriate identification, of the consumer’s election
to have the consumer’s name and address excluded from any such list of names
and addresses provided by the agency for such a transaction; and
(ii)publish
by not later than 365 days after the date of enactment of the Consumer Credit
Reporting Reform Act of 1996, and not less than annually thereafter, in a
publication of general circulation in the area served by the agency
(I)a
notification that information in consumer files maintained by the agency may be
used in connection with such transactions; and
(II)the
address and toll-free telephone number for consumers to use to notify the
agency of the consumer’s election under clause (I).
(B)Establishment and maintenance as compliance.
Establishment and maintenance of a notification system (including a toll-free
telephone number) and publication by a consumer reporting agency on the
agency’s own behalf and on behalf of any of its affiliates in accordance with
this paragraph is deemed to be compliance with this paragraph by each of those
affiliates.
(6)Notification system by agencies that operate
nationwide. Each consumer reporting agency that compiles and
maintains files on consumers on a nationwide basis shall establish and maintain
a notification system for purposes of paragraph (5) jointly with other such
consumer reporting agencies.
(f)Certain use or obtaining of information
prohibited. A person shall not use or obtain a consumer report for
any purpose unless
(1)the
consumer report is obtained for a purpose for which the consumer report is
authorized to be furnished under this section; and
(2)the
purpose is certified in accordance with section 607 [§ 1681e] by a prospective
user of the report through a general or specific certification.
(g)Protection
of Medical Information
(1)Limitation on consumer reporting agencies.
A consumer reporting agency shall not furnish for employment purposes, or in
connection with a credit or insurance transaction, a consumer report that
contains medical information (other than medical contact information treated in
the manner required under section 605(a)(6)) about a consumer, unless–
(A)if
furnished in connection with an insurance transaction, the consumer
affirmatively consents to the furnishing of the report;
(B)if
furnished for employment purposes or in connection with a credit transaction–
(i)the
information to be furnished is relevant to process or effect the employment or
credit transaction; and
(ii)the
consumer provides specific written consent for the furnishing of the report
that describes in clear and conspicuous language the use for which the
information will be furnished; or
(C)the
information to be furnished pertains solely to transactions, accounts, or
balances relating to debts arising from the receipt of medical services,
products, or devises, where such information, other than account status or
amounts, is restricted or reported using codes that do not identify, or do not
provide information sufficient to infer, the specific provider or the nature of
such services, products, or devices, as provided in section 605(a)(6).
(2)Limitation on creditors. Except as
permitted pursuant to paragraph (3)(C) or regulations prescribed under
paragraph (5)(A), a creditor shall not obtain or use medical information (other
than medical contact information treated in the manner required under section
605(a)(6)) pertaining to a consumer in connection with any determination of the
consumer’s eligibility, or continued eligibility, for credit.
(3)Actions authorized by federal law, insurance
activities and regulatory determinations. Section 603(d)(3) shall
not be construed so as to treat information or any communication of information
as a consumer report if the information or communication is disclosed–
(A)in
connection with the business of insurance or annuities, including the
activities described in section 18B of the model Privacy of Consumer Financial
and Health Information Regulation issued by the National Association of
Insurance Commissioners (as in effect on January 1, 2003);
(B)for
any purpose permitted without authorization under the Standards for
Individually Identifiable Health Information promulgated by the Department of
Health and Human Services pursuant to the Health Insurance Portability and Accountability
Act of 1996, or referred to under section 1179 of such Act, or described in
section 502(e) of Public Law 106-102; or
(C)as
otherwise determined to be necessary and appropriate, by regulation or order
and subject to paragraph (6), by the Commission, any Federal banking agency or
the National Credit Union Administration (with respect to any financial
institution subject to the jurisdiction of such agency or Administration under
paragraph (1), (2), or (3) of section 621(b), or the applicable State insurance
authority (with respect to any person engaged in providing insurance or
annuities).
(4)Limitation on redisclosure of medical
information. Any person that receives medical information pursuant
to paragraph (1) or (3) shall not disclose such information to any other
person, except as necessary to carry out the purpose for which the information
was initially disclosed, or as otherwise permitted by statute, regulation, or
order.
(5)Regulations
and Effective Date for Paragraph (2)
(A)Regulations required. Each Federal
banking agency and the National Credit Union Administration shall, subject to
paragraph (6) and after notice and opportunity for comment, prescribe
regulations that permit transactions under paragraph (2) that are determined to
be necessary and appropriate to protect legitimate operational, transactional,
risk, consumer, and other needs (and which shall include permitting actions
necessary for administrative verification purposes), consistent with the intent
of paragraph (2) to restrict the use of medical information for inappropriate
purposes.
(B)Final regulations required. The Federal banking agencies and the
National Credit Union Administration shall issue the regulations required under
sub-paragraph (A) in final form before the end of the 6-month period beginning
on the date of enactment of the Fair and Accurate Credit Transactions Act of
2003.
See also 12 CFR Parts 41/222/232/334/571/717
70 Fed. Reg. 70664 (11/22/05)
(6)Coordination with other laws. No
provision of this subsection shall be construed as altering, affecting, or
superseding the applicability of any other provision of Federal law relating to
medical confidentiality.
605.
Requirements relating to information contained in consumer reports [15
U.S.C. §1681c]
(a)Information excluded from consumer reports.
Except as authorized under subsection
(b)of
this section, no consumer reporting agency may make any consumer report
containing any of the following items of information:
(1)Cases
under title 11 [United States Code] or under the Bankruptcy Act that, from the
date of entry of the order for relief or the date of adjudication, as the case
may be, antedate the report by more than 10 years.
(2)Civil
suits, civil judgments, and records of arrest that from date of entry, antedate
the report by more than seven years or until the governing statute of
limitations has expired, whichever is the longer period.
(3)Paid
tax liens which, from date of payment, antedate the report by more than seven
years.
(4)Accounts
placed for collection or charged to profit and loss which antedate the report
by more than seven years.2
(5)Any
other adverse item of information, other than records of convictions of crimes
which antedates the report by more than seven years.2
(6)The
name, address, and telephone number of any medical information furnisher that
has notified the agency of its status, unless–
(A)such
name, address, and telephone number are restricted or reported using codes that
do not identify, or provide information sufficient to infer, the specific
provider or the nature of such services, products, or devices to a person other
than the consumer; or
(B)the
report is being provided to an insurance company for a purpose relating to
engaging in the business of insurance other than property and casualty
insurance.
(b)Exempted cases. The provisions of
paragraphs (1) through (5) of subsection (a) of this section are not applicable
in the case of any consumer credit report to be used in connection with
(1)a
credit transaction involving, or which may reasonably be expected to involve, a
principal amount of $150,000 or more;
(2)the
underwriting of life insurance involving, or which may reasonably be expected
to involve, a face amount of $150,000 or more; or
(3)the
employment of any individual at an annual salary which equals, or which may
reasonably be expected to equal $75,000, or more.
(c)Running
of Reporting Period
(1)In general. The 7-year period
referred to in paragraphs (4) and (6)3 of
subsection (a) shall begin, with respect to any delinquent account that is
placed for collection (internally or by referral to a third party, whichever is
earlier), charged to profit and loss, or subjected to any similar action, upon
the expiration of the 180-day period beginning on the date of the commencement
of the delinquency which immediately preceded the collection activity, charge
to profit and loss, or similar action.
(2)Effective date. Paragraph (1) shall
apply only to items of information added to the file of a consumer on or after
the date that is 455 days after the date of enactment of the Consumer Credit
Reporting Reform Act of 1996.
(d)Information
Required to be Disclosed
(1)Title 11 information. Any consumer
reporting agency that furnishes a consumer report that contains information
regarding any case involving the consumer that arises under title 11, United
States Code, shall include in the report an identification of the chapter of
such title 11 under which such case arises if provided by the source of the
information. If any case arising or filed under title 11, United States Code,
is withdrawn by the consumer before a final judgment, the consumer reporting
agency shall include in the report that such case or filing was withdrawn upon
receipt of documentation certifying such withdrawal.
(2)Key factor in credit score information.
Any consumer reporting agency that furnishes a consumer report that contains
any credit score or any other risk score or predictor on any consumer shall
include in the report a clear and conspicuous statement that a key factor (as
defined in section 609(f)(2)(B)) that adversely affected such score or
predictor was the number of enquiries, if such a predictor was in fact a key
factor that adversely affected such score. This paragraph shall not apply to a
check services company, acting as such, which issues authorizations for the
purpose of approving or processing negotiable instruments, electronic fund
transfers, or similar methods of payments, but only to the extent that such
company is engaged in such activities.
(e)Indication of closure of account by consumer.
If a consumer reporting agency is notified pursuant to section 623(a)(4) [§
1681s-2] that a credit account of a consumer was voluntarily closed by the
consumer, the agency shall indicate that fact in any consumer report that
includes information related to the account.
(f)Indication of dispute by consumer.
If a consumer reporting agency is notified pursuant to section 623(a)(3) [§
1681s-2] that information regarding a consumer who was furnished to the agency
is disputed by the consumer, the agency shall indicate that fact in each
consumer report that includes the disputed information.
(g)Truncation
of Credit Card and Debit Card Numbers
(1)In general. Except as otherwise
provided in this subsection, no person that accepts credit cards or debit cards
for the transaction of business shall print more than the last 5 digits of the
card number or the expiration date upon any receipt provided to the cardholder
at the point of the sale or transaction.
(2)Limitation. This subsection shall
apply only to receipts that are electronically printed, and shall not apply to
transactions in which the sole means of recording a credit card or debit card
account number is by handwriting or by an imprint or copy of the card.
(3)Effective date. This subsection
shall become effective–
(A)3
years after the date of enactment of this subsection, with respect to any cash
register or other machine or device that electronically prints receipts for
credit card or debit card transactions that is in use before January 1, 2005;
and
(B)1
year after the date of enactment of this subsection, with respect to any cash
register or other machine or device that electronically prints receipts for
credit card or debit card transactions that is first put into use on or after
January 1, 2005.
(h)Notice
of Discrepancy in Address
(1)In general. If a person has
requested a consumer report relating to a consumer from a consumer reporting
agency described in section 603(p), the request includes an address for the
consumer that substantially differs from the addresses in the file of the
consumer, and the agency provides a consumer report in response to the request,
the consumer reporting agency shall notify the requester of the existence of
the discrepancy.
(2)Regulations
(A)Regulations required. The Federal
banking agencies, the National Credit Union Administration, and the Commission
shall jointly, with respect to the entities that are subject to their
respective enforcement authority under section 621, prescribe regulations
providing guidance regarding reasonable policies and procedures that a user of
a consumer report should employ when such user has received a notice of
discrepancy under paragraph (1).
(B)Policies and procedures to be included.
The regulations prescribed under subparagraph (A) shall describe reasonable
policies and procedures for use by a user of a consumer report–
(i)to
form a reasonable belief that the user knows the identity of the person to whom
the consumer report pertains; and
(ii)if
the user establishes a continuing relationship with the consumer, and the user
regularly and in the ordinary course of business furnishes information to the
consumer reporting agency from which the notice of discrepancy pertaining to
the consumer was obtained, to reconcile the address of the consumer with the
consumer reporting agency by furnishing such address to such consumer reporting
agency as part of information regularly furnished by the user for the period in
which the relationship is established.
605A.
Identity theft prevention; fraud alerts and active duty alerts [15
U.S.C. §1681c-1]
(a)One-call
Fraud Alerts
(1)Initial alerts. Upon the direct
request of a consumer, or an individual acting on behalf of or as a personal
representative of a consumer, who asserts in good faith a suspicion that the
consumer has been or is about to become a victim of fraud or related crime,
including identity theft, a consumer reporting agency described in section
603(p) that maintains a file on the consumer and has received appropriate proof
of the identity of the requester shall–
(A)include
a fraud alert in the file of that consumer, and also provide that alert along
with any credit score generated in using that file, for a period of not less
than 90 days, beginning on the date of such request, unless the consumer or
such representative requests that such fraud alert be removed before the end of
such period, and the agency has received appropriate proof of the identity of
the requester for such purpose; and
(B)refer
the information regarding the fraud alert under this paragraph to each of the
other consumer reporting agencies described in section 603(p), in accordance
with procedures developed under section 621(f).
(2)Access to free reports. In any case
in which a consumer reporting agency includes a fraud alert in the file of a
consumer pursuant to this subsection, the consumer reporting agency shall–
(A)disclose
to the consumer that the consumer may request a free copy of the file of the
consumer pursuant to section 612(d); and
(B)provide
to the consumer all disclosures required to be made under section 609, without
charge to the consumer, not later than 3 business days after any request
described in subparagraph (A).
(b)Extended
Alerts
(1)In general. Upon the direct request
of a consumer, or an individual acting on behalf of or as a personal
representative of a consumer, who submits an identity theft report to a
consumer reporting agency described in section 603(p) that maintains a file on
the consumer, if the agency has received appropriate proof of the identity of
the requester, the agency shall–
(A)include
a fraud alert in the file of that consumer, and also provide that alert along
with any credit score generated in using that file, during the 7-year period
beginning on the date of such request, unless the consumer or such
representative requests that such fraud alert be removed before the end of such
period and the agency has received appropriate proof of the identity of the
requester for such purpose;
(B)during
the 5-year period beginning on the date of such request, exclude the consumer
from any list of consumers prepared by the consumer reporting agency and
provided to any third party to offer credit or insurance to the consumer as
part of a transaction that was not initiated by the consumer, unless the consumer
or such representative requests that such exclusion be rescinded before the end
of such period; and
(C)refer
the information regarding the extended fraud alert under this paragraph to each
of the other consumer reporting agencies described in section 603(p), in
accordance with procedures developed under section 621(f).
(2)Access to free reports. In any case
in which a consumer reporting agency includes a fraud alert in the file of a
consumer pursuant to this subsection, the consumer reporting agency shall–
(A)disclose
to the consumer that the consumer may request 2 free copies of the file of the
consumer pursuant to section 612(d) during the 12-month period beginning on the
date on which the fraud alert was included in the file; and
(B)provide
to the consumer all disclosures required to be made under section 609, without
charge to the consumer, not later than 3 business days after any request
described in subparagraph (A).
(c)Active duty alerts. Upon the direct
request of an active duty military consumer, or an individual acting on behalf
of or as a personal representative of an active duty military consumer, a
consumer reporting agency described in section 603(p) that maintains a file on
the active duty military consumer and has received appropriate proof of the
identity of the requester shall–
(1)include
an active duty alert in the file of that active duty military consumer, and
also provide that alert along with any credit score generated in using that
file, during a period of not less than 12 months, or such longer period as the
Commission shall determine, by regulation, beginning on the date of the
request, unless the active duty military consumer or such representative
requests that such fraud alert be removed before the end of such period, and the
agency has received appropriate proof of the identity of the requester for such
purpose;
(2)during
the 2-year period beginning on the date of such request, exclude the active
duty military consumer from any list of consumers prepared by the consumer
reporting agency and provided to any third party to offer credit or insurance
to the consumer as part of a transaction that was not initiated by the
consumer, unless the consumer requests that such exclusion be rescinded before
the end of such period; and
(3)refer
the information regarding the active duty alert to each of the other consumer
reporting agencies described in section 603(p), in accordance with procedures
developed under section 621(f).
See also 16 CFR Part 613.1
69 Fed. Reg. 63922 (11/03/04)
(d)Procedures. Each consumer reporting
agency described in section 603(p) shall establish policies and procedures to
comply with this section, including procedures that inform consumers of the
availability of initial, extended, and active duty alerts and procedures that
allow consumers and active duty military consumers to request initial,
extended, or active duty alerts (as applicable) in a simple and easy manner,
including by telephone.
(e)Referrals of alerts. Each consumer
reporting agency described in section 603(p) that receives a referral of a
fraud alert or active duty alert from another consumer reporting agency
pursuant to this section shall, as though the agency received the request from
the consumer directly, follow the procedures required under–
(1)paragraphs
(1)(A) and (2) of subsection (a), in the case of a referral under subsection
(a)(1)(B);
(2)paragraphs
(1)(A), (1)(B), and (2) of subsection (b), in the case of a referral under
subsection (b)(1)(C); and
(3)paragraphs
(1) and (2) of subsection (c), in the case of a referral under subsection
(c)(3).
(f)Duty of reseller to reconvey alert.
A reseller shall include in its report any fraud alert or active duty alert
placed in the file of a consumer pursuant to this section by another consumer
reporting agency.
(g)Duty of other consumer reporting agencies to
provide contact information. If a consumer contacts any consumer
reporting agency that is not described in section 603(p) to communicate a
suspicion that the consumer has been or is about to become a victim of fraud or
related crime, including identity theft, the agency shall provide information
to the consumer on how to contact the Commission and the consumer reporting
agencies described in section 603(p) to obtain more detailed information and
request alerts under this section.
(h)Limitations
on Use of Information for Credit Extensions
(1)Requirements
for initial and active duty alerts-
(A)Notification. Each initial fraud
alert and active duty alert under this section shall include information that
notifies all prospective users of a consumer report on the consumer to which
the alert relates that the consumer does not authorize the establishment of any
new credit plan or extension of credit, other than under an open-end credit
plan (as defined in section 103(i)), in the name of the consumer, or issuance
of an additional card on an existing credit account requested by a consumer, or
any increase in credit limit on an existing credit account requested by a
consumer, except in accordance with subparagraph (B).
(B)Limitation
on Users
(i)In general. No prospective user of
a consumer report that includes an initial fraud alert or an active duty alert
in accordance with this section may establish a new credit plan or extension of
credit, other than under an open-end credit plan (as defined in section
103(i)), in the name of the consumer, or issue an additional card on an
existing credit account requested by a consumer, or grant any increase in
credit limit on an existing credit account requested by a consumer, unless the
user utilizes reasonable policies and procedures to form a reasonable belief
that the user knows the identity of the person making the request.
(ii)Verification. If a consumer
requesting the alert has specified a telephone number to be used for identity
verification purposes, before authorizing any new credit plan or extension
described in clause (i) in the name of such consumer, a user of such consumer
report shall contact the consumer using that telephone number or take
reasonable steps to verify the consumer’s identity and confirm that the
application for a new credit plan is not the result of identity theft.
(2)Requirements
for Extended Alerts
(A)Notification. Each extended alert
under this section shall include information that provides all prospective
users of a consumer report relating to a consumer with-
(i)notification
that the consumer does not authorize the establishment of any new credit plan
or extension of credit described in clause (i), other than under an open-end
credit plan (as defined in section 103(i)), in the name of the consumer, or
issuance of an additional card on an existing credit account requested by a
consumer, or any increase in credit limit on an existing credit account
requested by a consumer, except in accordance with subparagraph (B); and
(ii)a
telephone number or other reasonable contact method designated by the consumer.
(B)Limitation on users. No prospective
user of a consumer report or of a credit score generated using the information
in the file of a consumer that includes an extended fraud alert in accordance
with this section may establish a new credit plan or extension of credit, other
than under an open-end credit plan (as defined in section 103(i)), in the name
of the consumer, or issue an additional card on an existing credit account
requested by a consumer, or any increase in credit limit on an existing credit
account requested by a consumer, unless the user contacts the consumer in
person or using the contact method described in subparagraph (A)(ii) to confirm
that the application for a new credit plan or increase in credit limit, or
request for an additional card is not the result of identity theft.
605B.
Block of information resulting from identity theft [15
U.S.C. §1681c-2]
(a)Block. Except as otherwise provided
in this section, a consumer reporting agency shall block the reporting of any
information in the file of a consumer that the consumer identifies as
information that resulted from an alleged identity theft, not later than 4
business days after the date of receipt by such agency of-
(1)appropriate
proof of the identity of the consumer;
(2)a
copy of an identity theft report;
(3)the
identification of such information by the consumer; and
(4)a
statement by the consumer that the information is not information relating to
any transaction by the consumer.
(b)Notification. A consumer reporting
agency shall promptly notify the furnisher of information identified by the
consumer under subsection (a)–
(1)that
the information may be a result of identity theft;
(2)that
an identity theft report has been filed;
(3)that
a block has been requested under this section; and
(4)of
the effective dates of the block.
(c)Authority
to Decline or Rescind
(1)In general. A consumer reporting
agency may decline to block, or may rescind any block, of information relating
to a consumer under this section, if the consumer reporting agency reasonably
determines that–
(A)the
information was blocked in error or a block was requested by the consumer in
error;
(B)the
information was blocked, or a block was requested by the consumer, on the basis
of a material misrepresentation of fact by the consumer relevant to the request
to block; or
(C)the
consumer obtained possession of goods, services, or money as a result of the
blocked transaction or transactions.
(2)Notification to consumer. If a
block of information is declined or rescinded under this subsection, the
affected consumer shall be notified promptly, in the same manner as consumers
are notified of the reinsertion of information under section 611(a)(5)(B).
(3)Significance of block. For purposes
of this subsection, if a consumer reporting agency rescinds a block, the
presence of information in the file of a consumer prior to the blocking of such
information is not evidence of whether the consumer knew or should have known
that the consumer obtained possession of any goods, services, or money as a
result of the block.
(d)Exception
for Resellers
(1)No reseller file. This section
shall not apply to a consumer reporting agency, if the consumer reporting
agency–
(A)is
a reseller;
(B)is
not, at the time of the request of the consumer under subsection (a), otherwise
furnishing or reselling a consumer report concerning the information identified
by the consumer; and
(C)informs
the consumer, by any means, that the consumer may report the identity theft to
the Commission to obtain consumer information regarding identity theft.
(2)Reseller with file. The sole
obligation of the consumer reporting agency under this section, with regard to
any request of a consumer under this section, shall be to block the consumer
report maintained by the consumer reporting agency from any subsequent use,
if–
(A)the
consumer, in accordance with the provisions of subsection (a), identifies, to a
consumer reporting agency, information in the file of the consumer that
resulted from identity theft; and
(B)the
consumer reporting agency is a reseller of the identified information.
(3)Notice. In carrying out its
obligation under paragraph (2), the reseller shall promptly provide a notice to
the consumer of the decision to block the file. Such notice shall contain the
name, address, and telephone number of each consumer reporting agency from
which the consumer information was obtained for resale.
(e)Exception for verification companies.
The provisions of this section do not apply to a check services company, acting
as such, which issues authorizations for the purpose of approving or processing
negotiable instruments, electronic fund transfers, or similar methods of
payments, except that, beginning 4 business days after receipt of information
described in paragraphs (1) through (3) of subsection (a), a check services
company shall not report to a national consumer reporting agency described in
section 603(p), any information identified in the subject identity theft report
as resulting from identity theft.
(f)Access to blocked information by law
enforcement agencies. No provision of this section shall be
construed as requiring a consumer reporting agency to prevent a Federal, State,
or local law enforcement agency from accessing blocked information in a
consumer file to which the agency could otherwise obtain access under this
title.
606.
Disclosure of investigative consumer reports [15 U.S.C. § 1681d]
(a)Disclosure of fact of preparation.
A person may not procure or cause to be prepared an investigative consumer
report on any consumer unless
(1)it
is clearly and accurately disclosed to the consumer that an investigative
consumer report including information as to his character, general reputation,
personal characteristics and mode of living, whichever are applicable, may be
made, and such disclosure
(A)is
made in a writing mailed, or otherwise delivered, to the consumer, not later
than three days after the date on which the report was first requested, and
(B)includes
a statement informing the consumer of his right to request the additional
disclosures provided for under subsection (b) of this section and the written
summary of the rights of the consumer prepared pursuant to section 609(c) [§
1681g]; and
(2)the
person certifies or has certified to the consumer reporting agency that
(A)the
person has made the disclosures to the consumer required by paragraph (1); and
(B)the
person will comply with subsection (b).
(b)Disclosure on request of nature and scope of
investigation. Any person who procures or causes to be prepared an
investigative consumer report on any consumer shall, upon written request made
by the consumer within a reasonable period of time after the receipt by him of
the disclosure required by subsection (a)(1) of this section, make a complete
and accurate disclosure of the nature and scope of the investigation requested.
This disclosure shall be made in a writing mailed, or otherwise delivered, to
the consumer not later than five days after the date on which the request for
such disclosure was received from the consumer or such report was first
requested, whichever is the later.
(c)Limitation on liability upon showing of
reasonable procedures for compliance with provisions. No person may
be held liable for any violation of subsection (a) or (b) of this section if he
shows by a preponderance of the evidence that at the time of the violation he
maintained reasonable procedures to assure compliance with subsection (a) or
(b) of this section.
(d)Prohibitions
(1)Certification. A consumer reporting
agency shall not prepare or furnish investigative consumer report unless the
agency has received a certification under subsection (a)(2) from the person who
requested the report.
(2)Inquiries. A consumer reporting
agency shall not make an inquiry for the purpose of preparing an investigative
consumer report on a consumer for employment purposes if the making of the
inquiry by an employer or prospective employer of the consumer would violate
any applicable Federal or State equal employment opportunity law or regulation.
(3)Certain public record information.
Except as otherwise provided in section 613 [§ 1681k], a consumer reporting
agency shall not furnish an investigative consumer report that includes
information that is a matter of public record and that relates to an arrest,
indictment, conviction, civil judicial action, tax lien, or outstanding
judgment, unless the agency has verified the accuracy of the information during
the 30-day period ending on the date on which the report is furnished.
(4)Certain adverse information. A
consumer reporting agency shall not prepare or furnish an investigative
consumer report on a consumer that contains information that is adverse to the
interest of the consumer and that is obtained through a personal interview with
a neighbor, friend, or associate of the consumer or with another person with
whom the consumer is acquainted or who has knowledge of such item of
information, unless
(A)the
agency has followed reasonable procedures to obtain confirmation of the
information, from an additional source that has independent and direct
knowledge of the information; or
(B)the
person interviewed is the best possible source of the information.
607.
Compliance procedures [15 U.S.C. § 1681e]
(a)Identity and purposes of credit users.
Every consumer reporting agency shall maintain reasonable procedures designed
to avoid violations of section 605 [§ 1681c] and to limit the furnishing of
consumer reports to the purposes listed under section 604 [§ 1681b] of this
title. These procedures shall require that prospective users of the information
identify themselves, certify the purposes for which the information is sought,
and certify that the information will be used for no other purpose. Every
consumer reporting agency shall make a reasonable effort to verify the identity
of a new prospective user and the uses certified by such prospective user prior
to furnishing such user a consumer report. No consumer reporting agency may
furnish a consumer report to any person if it has reasonable grounds for
believing that the consumer report will not be used for a purpose listed in
section 604 [§ 1681b] of this title.
(b)Accuracy of report. Whenever a
consumer reporting agency prepares a consumer report it shall follow reasonable
procedures to assure maximum possible accuracy of the information concerning
the individual about whom the report relates.
(c)Disclosure of consumer reports by users allowed.
A consumer reporting agency may not prohibit a user of a consumer report
furnished by the agency on a consumer from disclosing the contents of the
report to the consumer, if adverse action against the consumer has been taken
by the user based in whole or in part on the report.
(d)Notice
to Users and Furnishers of Information
(1)Notice requirement. A consumer
reporting agency shall provide to any person
(A)who
regularly and in the ordinary course of business furnishes information to the
agency with respect to any consumer; or
(B)to
whom a consumer report is provided by the agency; a notice of such person’s
responsibilities under this title.
See also 16 CFR 698, App G-H
69 Fed. Reg. 69776 (11/30/04)
(2)Content of notice. The Federal
Trade Commission shall prescribe the content of notices under paragraph (1),
and a consumer reporting agency shall be in compliance with this subsection if
it provides a notice under paragraph (1) that is substantially similar to the
Federal Trade Commission prescription under this paragraph.
(e)Procurement
of Consumer Report for Resale
(1)Disclosure. A person may not
procure a consumer report for purposes of reselling the report (or any
information in the report) unless the person discloses to the consumer
reporting agency that originally furnishes the report
(A)the
identity of the end-user of the report (or information); and
(B)each
permissible purpose under section 604 [§ 1681b] for which the report is
furnished to the end-user of the report (or information).
(2)Responsibilities of procurers for resale.
A person who procures a consumer report for purposes of reselling the report
(or any information in the report) shall
(A)establish
and comply with reasonable procedures designed to ensure that the report (or
information) is resold by the person only for a purpose for which the report
may be furnished under section 604 [§ 1681b], including by requiring that each
person to which the report (or information) is resold and that resells or
provides the report (or information) to any other person
(i)identifies
each end user of the resold report (or information);
(ii)certifies
each purpose for which the report (or information) will be used; and
(iii)certifies
that the report (or information) will be used for no other purpose; and
(B)before
reselling the report, make reasonable efforts to verify the identifications and
certifications made under subparagraph (A).
(3)Resale of consumer report to a federal agency
or department. Notwithstanding paragraph (1) or (2), a person who
procures a consumer report for purposes of reselling the report (or any
information in the report) shall not disclose the identity of the end-user of
the report under paragraph (1) or (2) if-
(A)the
end user is an agency or department of the United States Government which
procures the report from the person for purposes of determining the eligibility
of the consumer concerned to receive access or continued access to classified
information (as defined in section 604(b)(4)(E)(i)); and
(B)the
agency or department certifies in writing to the person reselling the report
that nondisclosure is necessary to protect classified information or the safety
of persons employed by or contracting with, or undergoing investigation for
work or contracting with the agency or department.
608.
Disclosures to governmental agencies [15 U.S.C. § 1681f]
Notwithstanding
the provisions of section 604 [§ 1681b] of this title, a consumer reporting
agency may furnish identifying information respecting any consumer, limited to
his name, address, former addresses, places of employment, or former places of
employment, to a governmental agency.
609.
Disclosures to consumers [15 U.S.C. § 1681g]
(a)Information on file; sources; report recipients.
Every consumer reporting agency shall, upon request, and subject to 610(a)(1)
[§ 1681h], clearly and accurately disclose to the consumer:
(1)All
information in the consumer’s file at the time of the request except that–
(A)if
the consumer to whom the file relates requests that the first 5 digits of the
social security number (or similar identification number) of the consumer not
be included in the disclosure and the consumer reporting agency has received
appropriate proof of the identity of the requester, the consumer reporting
agency shall so truncate such number in such disclosure; and
(B)nothing
in this paragraph shall be construed to require a consumer reporting agency to
disclose to a consumer any information concerning credit scores or any other
risk scores or predictors relating to the consumer.
(2)The
sources of the information; except that the sources of information acquired
solely for use in preparing an investigative consumer report and actually use
for no other purpose need not be disclosed: Provided, That in the event an
action is brought under this title, such sources shall be available to the
plaintiff under appropriate discovery procedures in the court in which the
action is brought.
(3)(A)Identification
of each person (including each end-user identified under section 607(e)(1) [§
1681e]) that procured a consumer report
(i)for
employment purposes, during the 2-year period preceding the date on which the
request is made; or
(ii)for
any other purpose, during the 1-year period preceding the date on which the
request is made.
(B)An
identification of a person under subparagraph (A) shall include
(i)the
name of the person or, if applicable, the trade name (written in full) under
which such person conducts business; and
(ii)upon
request of the consumer, the address and telephone number of the person.
(C)Subparagraph
(A) does not apply if–
(i)the
end user is an agency or department of the United States Government that
procures the report from the person for purposes of determining the eligibility
of the consumer to whom the report relates to receive access or continued
access to classified information (as defined in section 604(b)(4)(E)(i)); and
(ii)the
head of the agency or department makes a written finding as prescribed under
section 604(b)(4)(A).
(4)The
dates, original payees, and amounts of any checks upon which is based any
adverse characterization of the consumer, included in the file at the time of
the disclosure.
(5)A
record of all inquiries received by the agency during the 1-year period
preceding the request that identified the consumer in connection with a credit
or insurance transaction that was not initiated by the consumer.
(6)If
the consumer requests the credit file and not the credit score, a statement
that the consumer may request and obtain a credit score.
(b)Exempt information. The
requirements of subsection (a) of this section respecting the disclosure of
sources of information and the recipients of consumer reports do not apply to
information received or consumer reports furnished prior to the effective date
of this title except to the extent that the matter involved is contained in the
files of the consumer reporting agency on that date.
(c)Summary
of Rights to Obtain and Dispute Information in Consumer Reports and to Obtain
Credit Scores
See also 16 CFR Part 698, App F
69 Fed. Reg. 69776 (11/30/04)
(1)Commission
Summary of Rights Required
(A)In general. The Commission shall
prepare a model summary of the rights of consumers under this title.
(B)Content of summary. The summary of
rights prepared under subparagraph (A) shall include a description of-
(i)the
right of a consumer to obtain a copy of a consumer report under subsection (a)
from each consumer reporting agency;
(ii)the
frequency and circumstances under which a consumer is entitled to receive a
consumer report without charge under section 612;
(iii)the
right of a consumer to dispute information in the file of the consumer under
section 611;
(iv)the
right of a consumer to obtain a credit score from a consumer reporting agency,
and a description of how to obtain a credit score;
(v)the
method by which a consumer can contact, and obtain a consumer report from, a
consumer reporting agency without charge, as provided in the regulations of the
Commission prescribed under section 211(c) of the Fair and Accurate Credit
Transactions Act of 2003; and
(vi)the
method by which a consumer can contact, and obtain a consumer report from, a
consumer reporting agency described in section 603(w), as provided in the
regulations of the Commission prescribed under section 612(a)(1)(C).
(C)Availability of summary of rights.
The Commission shall–
(i)actively
publicize the availability of the summary of rights prepared under this
paragraph;
(ii)conspicuously
post on its Internet website the availability of such summary of rights; and
(iii)promptly
make such summary of rights available to consumers, on request.
(2)Summary of rights required to be included with
agency disclosures. A consumer reporting agency shall provide to a
consumer, with each written disclosure by the agency to the consumer under this
section–
(A)the
summary of rights prepared by the Commission under paragraph (1);
(B)in
the case of a consumer reporting agency described in section 603(p), a
toll-free telephone number established by the agency, at which personnel are
accessible to consumers during normal business hours;
(C)a
list of all Federal agencies responsible for enforcing any provision of this
title, and the address and any appropriate phone number of each such agency, in
a form that will assist the consumer in selecting the appropriate agency;
(D)a
statement that the consumer may have additional rights under State law, and
that the consumer may wish to contact a State or local consumer protection
agency or a State attorney general (or the equivalent thereof) to learn of
those rights; and
(E)a
statement that a consumer reporting agency is not required to remove accurate
derogatory information from the file of a consumer, unless the information is
outdated under section 605 or cannot be verified.
(d)Summary
of Rights of Identity Theft Victims
See also 16 CFR Part 698, App E
69 Fed. Reg. 69776 (11/30/04)
(1)In general. The Commission, in
consultation with the Federal banking agencies and the National Credit Union
Administration, shall prepare a model summary of the rights of consumers under
this title with respect to the procedures for remedying the effects of fraud or
identity theft involving credit, an electronic fund transfer, or an account or
transaction at or with a financial institution or other creditor.
(2)Summary of rights and contact information.
Beginning 60 days after the date on which the model summary of rights is
prescribed in final form by the Commission pursuant to paragraph (1), if any
consumer contacts a consumer reporting agency and expresses a belief that the
consumer is a victim of fraud or identity theft involving credit, an electronic
fund transfer, or an account or transaction at or with a financial institution
or other creditor, the consumer reporting agency shall, in addition to any
other action that the agency may take, provide the consumer with a summary of
rights that contains all of the information required by the Commission under
paragraph (1), and information on how to contact the Commission to obtain more
detailed information.
(e)Information
Available to Victims
(1)In general. For the purpose of
documenting fraudulent transactions resulting from identity theft, not later
than 30 days after the date of receipt of a request from a victim in accordance
with paragraph (3), and subject to verification of the identity of the victim
and the claim of identity theft in accordance with paragraph (2), a business
entity that has provided credit to, provided for consideration products, goods,
or services to, accepted payment from, or otherwise entered into a commercial
transaction for consideration with, a person who has allegedly made unauthorized
use of the means of identification of the victim, shall provide a copy of
application and business transaction records in the control of the business
entity, whether maintained by the business entity or by another person on
behalf of the business entity, evidencing any transaction alleged to be a
result of identity theft to–
(A)the
victim;
(B)any
Federal, State, or local government law enforcement agency or officer specified
by the victim in such a request; or
(C)any
law enforcement agency investigating the identity theft and authorized by the
victim to take receipt of records provided under this subsection.
(2)Verification of identity and claim.
Before a business entity provides any information under paragraph (1), unless
the business entity, at its discretion, otherwise has a high degree of
confidence that it knows the identity of the victim making a request under
paragraph (1), the victim shall provide to the business entity–
(A)as
proof of positive identification of the victim, at the election of the business
entity-
(i)the
presentation of a government-issued identification card;
(ii)personally
identifying information of the same type as was provided to the business entity
by the unauthorized person; or
(iii)personally
identifying information that the business entity typically requests from new
applicants or for new transactions, at the time of the victim’s request for
information, including any documentation described in clauses (i) and (ii); and
(B)as
proof of a claim of identity theft, at the election of the business entity–
(i)a
copy of a police report evidencing the claim of the victim of identity theft;
and
(ii)a
properly completed–
(I)copy
of a standardized affidavit of identity theft developed and made available by
the Commission; or
(II)an
affidavit of fact that is acceptable to the business entity for that purpose.
(3)Procedures. The request of a victim
under paragraph (1) shall–
(A)be
in writing;
(B)be
mailed to an address specified by the business entity, if any; and
(C)if
asked by the business entity, include relevant information about any
transaction alleged to be a result of identity theft to facilitate compliance
with this section including-
(i)if
known by the victim (or if readily obtainable by the victim), the date of the
application or transaction; and
(ii)if
known by the victim (or if readily obtainable by the victim), any other
identifying information such as an account or transaction number.
(4)No charge to victim. Information
required to be provided under paragraph (1) shall be so provided without
charge.
(5)Authority to decline to provide information.
A business entity may decline to provide information under paragraph (1) if, in
the exercise of good faith, the business entity determines that–
(A)this
subsection does not require disclosure of the information;
(B)after
reviewing the information provided pursuant to paragraph (2), the business
entity does not have a high degree of confidence in knowing the true identity
of the individual requesting the information;
(C)the
request for the information is based on a misrepresentation of fact by the
individual requesting the information relevant to the request for information;
or
(D)the
information requested is Internet navigational data or similar information
about a person’s visit to a website or online service.
(6)Limitation on liability. Except as
provided in section 621, sections 616 and 617 do not apply to any violation of
this subsection.
(7)Limitation on civil liability. No
business entity may be held civilly liable under any provision of Federal,
State, or other law for disclosure, made in good faith pursuant to this
subsection.
(8)No new recordkeeping obligation.
Nothing in this subsection creates an obligation on the part of a business
entity to obtain, retain, or maintain information or records that are not
otherwise required to be obtained, retained, or maintained in the ordinary
course of its business or under other applicable law.
(9)Rule
of Construction
(A)In general. No provision of
subtitle A of title V of Public Law 106-102, prohibiting the disclosure of
financial information by a business entity to third parties shall be used to
deny disclosure of information to the victim under this subsection.
(B)Limitation. Except as provided in
subparagraph (A), nothing in this subsection permits a business entity to
disclose information, including information to law enforcement under
subparagraphs (B) and (C) of paragraph (1), that the business entity is
otherwise prohibited from disclosing under any other applicable provision of
Federal or State law.
(10)Affirmative defense. In any civil
action brought to enforce this subsection, it is an affirmative defense (which
the defendant must establish by a preponderance of the evidence) for a business
entity to file an affidavit or answer stating that-
(A)the
business entity has made a reasonably diligent search of its available business
records; and
(B)the
records requested under this subsection do not exist or are not reasonably
available.
(11)Definition of victim. For purposes
of this subsection, the term “victim” means a consumer whose means of
identification or financial information has been used or transferred (or has
been alleged to have been used or transferred) without the authority of that
consumer, with the intent to commit, or to aid or abet, an identity theft or a
similar crime.
(12)Effective date. This subsection
shall become effective 180 days after the date of enactment of this subsection.
(13)Effectiveness study. Not later than
18 months after the date of enactment of this subsection, the Comptroller
General of the United States shall submit a report to Congress assessing the
effectiveness of this provision.
(f)Disclosure
of Credit Scores
(1)In general. Upon the request of a
consumer for a credit score, a consumer reporting agency shall supply to the
consumer a statement indicating that the information and credit scoring model
may be different than the credit score that may be used by the lender, and a
notice which shall include–
(A)the
current credit score of the consumer or the most recent credit score of the
consumer that was previously calculated by the credit reporting agency for a
purpose related to the extension of credit;
(B)the
range of possible credit scores under the model used;
(C)all
of the key factors that adversely affected the credit score of the consumer in
the model used, the total number of which shall not exceed 4, subject to
paragraph (9);
(D)the
date on which the credit score was created; and
(E)the
name of the person or entity that provided the credit score or credit file upon
which the credit score was created.
(2)Definitions. For purposes of this
subsection, the following definitions shall apply:
(A)The
term “credit score” —
(i)means
a numerical value or a categorization derived from a statistical tool or
modeling system used by a person who makes or arranges a loan to predict the
likelihood of certain credit behaviors, including default (and the numerical
value or the categorization derived from such analysis may also be referred to
as a “risk predictor” or “risk score”); and
(ii)does
not include–
(I)any
mortgage score or rating of an automated underwriting system that considers one
or more factors in addition to credit information, including the loan to value
ratio, the amount of down payment, or the financial assets of a consumer; or
(II)any
other elements of the underwriting process or underwriting decision.
(B)The
term “key factors” means all relevant elements or reasons adversely
affecting the credit score for the particular individual, listed in the order
of their importance based on their effect on the credit score.
(3)Timeframe and manner of disclosure.
The information required by this subsection shall be provided in the same
timeframe and manner as the information described in subsection (a).
(4)Applicability to certain uses. This
subsection shall not be construed so as to compel a consumer reporting agency
to develop or disclose a score if the agency does not–
(A)distribute
scores that are used in connection with residential real property loans; or
(B)develop
scores that assist credit providers in understanding the general credit
behavior of a consumer and predicting the future credit behavior of the
consumer.
(5)Applicability
to credit scores developed by another person.
(A)In general. This subsection shall
not be construed to require a consumer reporting agency that distributes credit
scores developed by another person or entity to provide a further explanation
of them, or to process a dispute arising pursuant to section 611, except that
the consumer reporting agency shall provide the consumer with the name and
address and website for contacting the person or entity who developed the score
or developed the methodology of the score.
(B)Exception. This paragraph shall not
apply to a consumer reporting agency that develops or modifies scores that are
developed by another person or entity.
(6)Maintenance of credit scores not required.
This subsection shall not be construed to require a consumer reporting agency
to maintain credit scores in its files.
(7)Compliance in certain cases. In
complying with this subsection, a consumer reporting agency shall–
(A)supply
the consumer with a credit score that is derived from a credit scoring model
that is widely distributed to users by that consumer reporting agency in
connection with residential real property loans or with a credit score that
assists the consumer in understanding the credit scoring assessment of the
credit behavior of the consumer and predictions about the future credit
behavior of the consumer; and
(B)a
statement indicating that the information and credit scoring model may be
different than that used by the lender.
(8)Fair and reasonable fee. A consumer
reporting agency may charge a fair and reasonable fee, as determined by the
Commission, for providing the information required under this subsection.
See also 69 Fed. Reg. 64698 (11/08/04)
(9)Use of enquiries as a key factor.
If a key factor that adversely affects the credit score of a consumer consists
of the number of enquiries made with respect to a consumer report, that factor
shall be included in the disclosure pursuant to paragraph (1)(C) without regard
to the numerical limitation in such paragraph.
(g)Disclosure
of Credit Scores by Certain Mortgage Lenders
(1)In general. Any person who makes or
arranges loans and who uses a consumer credit score, as defined in subsection
(f), in connection with an application initiated or sought by a consumer for a
closed end loan or the establishment of an open end loan for a consumer purpose
that is secured by 1 to 4 units of residential real property (hereafter in this
subsection referred to as the “lender”) shall provide the following
to the consumer as soon as reasonably practicable:
(A)Information
Required under Subsection (f)
(i)In general. A copy of the
information identified in subsection (f) that was obtained from a consumer
reporting agency or was developed and used by the user of the information.
(ii)Notice under subparagraph (D). In
addition to the information provided to it by a third party that provided the
credit score or scores, a lender is only required to provide the notice
contained in subparagraph (D).
(B)Disclosures
in Case of Automated Underwriting System
(i)In general. If a person that is
subject to this subsection uses an automated underwriting system to underwrite
a loan, that person may satisfy the obligation to provide a credit score by
disclosing a credit score and associated key factors supplied by a consumer
reporting agency.
(ii)Numerical credit score. However, if
a numerical credit score is generated by an automated underwriting system used
by an enterprise, and that score is disclosed to the person, the score shall be
disclosed to the consumer consistent with subparagraph (C).
(iii)Enterprise defined. For purposes of
this subparagraph, the term “enterprise” has the same meaning as in
paragraph (6) of section 1303 of the Federal Housing Enterprises Financial
Safety and Soundness Act of 1992.
(C)Disclosures of credit scores not obtained from
a consumer reporting agency. A person that is subject to the
provisions of this subsection and that uses a credit score, other than a credit
score provided by a consumer reporting agency, may satisfy the obligation to
provide a credit score by disclosing a credit score and associated key factors supplied
by a consumer reporting agency.
(D)Notice to home loan applicants. A
copy of the following notice, which shall include the name, address, and
telephone number of each consumer reporting agency providing a credit score
that was used:
“Notice To The Home Loan Applicant”
“In connection with your application for a home loan, the lender must
disclose to you the score that a consumer reporting agency distributed to users
and the lender used in connection with your home loan, and the key factors
affecting your credit scores.”
“The credit score is a computer generated summary calculated at the time
of the request and based on information that a consumer reporting agency or
lender has on file. The scores are based on data about your credit history and
payment patterns. Credit scores are important because they are used to assist
the lender in determining whether you will obtain a loan. They may also be used
to determine what interest rate you may be offered on the mortgage. Credit
scores can change over time, depending on your conduct, how your credit history
and payment patterns change, and how credit scoring technologies change.”
“Because the score is based on information in your credit history, it is
very important that you review the credit-related information that is being
furnished to make sure it is accurate. Credit records may vary from one company
to another.”
“If you have questions about your credit score or the credit information
that is furnished to you, contact the consumer reporting agency at the address
and telephone number provided with this notice, or contact the lender, if the
lender developed or generated the credit score. The consumer reporting agency
plays no part in the decision to take any action on the loan application and is
unable to provide you with specific reasons for the decision on a loan
application.”
“If you have questions concerning the terms of the loan, contact the
lender.”
(E)Actions not required under this subsection.
This subsection shall not require any person to-
(i)explain
the information provided pursuant to subsection (f);
(ii)disclose
any information other than a credit score or key factors, as defined in
subsection (f);
(iii)disclose
any credit score or related information obtained by the user after a loan has
closed;
(iv)provide
more than 1 disclosure per loan transaction; or
(v)provide
the disclosure required by this subsection when another person has made the
disclosure to the consumer for that loan transaction.
(F)No
Obligation for Content
(i)In general. The obligation of any
person pursuant to this subsection shall be limited solely to providing a copy
of the information that was received from the consumer reporting agency.
(ii)Limit on liability. No person has
liability under this subsection for the content of that information or for the
omission of any information within the report provided by the consumer
reporting agency.
(G)Person defined as excluding enterprise.
As used in this subsection, the term “person” does not include an
enterprise (as defined in paragraph (6) of section 1303 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992).
(2)Prohibition
on Disclosure Clauses Null and Void
(A)In general. Any provision in a
contract that prohibits the disclosure of a credit score by a person who makes
or arranges loans or a consumer reporting agency is void.
(B)No liability for disclosure under this
subsection- A lender shall not have liability under any contractual
provision for disclosure of a credit score pursuant to this subsection.
610.
Conditions and form of disclosure to consumers [15
U.S.C. § 1681h]
(a)In
General
(1)Proper identification. A consumer
reporting agency shall require, as a condition of making the disclosures
required under section 609 [§ 1681g], that the consumer furnish proper
identification.
(2)Disclosure in writing. Except as
provided in subsection (b), the disclosures required to be made under section
609 [§ 1681g] shall be provided under that section in writing.
(b)Other
Forms of Disclosure
(1)In general. If authorized by a
consumer, a consumer reporting agency may make the disclosures required under
609 [§ 1681g]
(A)other
than in writing; and
(B)in
such form as may be
(i)specified
by the consumer in accordance with paragraph (2); and
(ii)available
from the agency.
(2)Form. A consumer may specify
pursuant to paragraph (1) that disclosures under section 609 [§ 1681g] shall be
made
(A)in
person, upon the appearance of the consumer at the place of business of the
consumer reporting agency where disclosures are regularly provided, during
normal business hours, and on reasonable notice;
(B)by
telephone, if the consumer has made a written request for disclosure by
telephone;
(C)by
electronic means, if available from the agency; or
(D)by
any other reasonable means that is available from the agency.
(c)Trained personnel. Any consumer
reporting agency shall provide trained personnel to explain to the consumer any
information furnished to him pursuant to section 609 [§ 1681g] of this title.
(d)Persons accompanying consumer. The consumer
shall be permitted to be accompanied by one other person of his choosing, who
shall furnish reasonable identification. A consumer reporting agency may
require the consumer to furnish a written statement granting permission to the
consumer reporting agency to discuss the consumer’s file in such person’s
presence.
(e)Limitation of liability. Except as
provided in sections 616 and 617 [§§1681n and 1681o] of this title, no consumer
may bring any action or proceeding in the nature of defamation, invasion of
privacy, or negligence with respect to the reporting of information against any
consumer reporting agency, any user of information, or any person who furnishes
information to a consumer reporting agency, based on information disclosed
pursuant to section 609, 610, or 615 [§§ 1681g, 1681h, or 1681m] of this title
or based on information disclosed by a user of a consumer report to or for a
consumer against whom the user has taken adverse action, based in whole or in
part on the report, except as to false information furnished with malice or
willful intent to injure such consumer.
611.
Procedure in case of disputed accuracy [15 U.S.C. § 1681i]
(a)Reinvestigations
of Disputed Information
(1)Reinvestigation
Required
(A)In general. Subject to subsection
(f), if the completeness or accuracy of any item of information contained in a
consumer’s file at a consumer reporting agency is disputed by the consumer and
the consumer notifies the agency directly, or indirectly through a reseller, of
such dispute, the agency shall, free of charge, conduct a reasonable
reinvestigation to determine whether the disputed information is inaccurate and
record the current status of the disputed information, or delete the item from
the file in accordance with paragraph (5), before the end of the 30-day period
beginning on the date on which the agency receives the notice of the dispute
from the consumer or reseller.
(B)Extension of period to reinvestigate.
Except as provided in subparagraph (C), the 30-day period described in subparagraph
(A) may be extended for not more than 15 additional days if the consumer
reporting agency receives information from the consumer during that 30-day
period that is relevant to the reinvestigation.
(C)Limitations on extension of period to
reinvestigate. Subparagraph (B) shall not apply to any
reinvestigation in which, during the 30-day period described in subparagraph
(A), the information that is the subject of the reinvestigation is found to be
inaccurate or incomplete or the consumer reporting agency determines that the
information cannot be verified.
(2)Prompt
Notice of Dispute to Furnisher of Information
(A)In general. Before the expiration
of the 5-business-day period beginning on the date on which a consumer
reporting agency receives notice of a dispute from any consumer or a reseller
in accordance with paragraph (1), the agency shall provide notification of the
dispute to any person who provided any item of information in dispute, at the
address and in the manner established with the person. The notice shall include
all relevant information regarding the dispute that the agency has received
from the consumer or reseller.
(B)Provision of other information. The
consumer reporting agency shall promptly provide to the person who provided the
information in dispute all relevant information regarding the dispute that is
received by the agency from the consumer or the reseller after the period
referred to in subparagraph (A) and before the end of the period referred to in
paragraph (1)(A).
(3)Determination
That Dispute Is Frivolous or Irrelevant
(A)In general. Notwithstanding
paragraph (1), a consumer reporting agency may terminate a reinvestigation of
information disputed by a consumer under that paragraph if the agency
reasonably determines that the dispute by the consumer is frivolous or
irrelevant, including by reason of a failure by a consumer to provide
sufficient information to investigate the disputed information.
(B)Notice of determination. Upon
making any determination in accordance with subparagraph (A) that a dispute is
frivolous or irrelevant, a consumer reporting agency shall notify the consumer
of such determination not later than 5 business days after making such
determination, by mail or, if authorized by the consumer for that purpose, by
any other means available to the agency.
(C)Contents of notice. A notice under
subparagraph (B) shall include
(i)the
reasons for the determination under subparagraph (A); and
(ii)identification
of any information required to investigate the disputed information, which may
consist of a standardized form describing the general nature of such
information.
(4)Consideration of consumer information.
In conducting any reinvestigation under paragraph (1) with respect to disputed
information in the file of any consumer, the consumer reporting agency shall
review and consider all relevant information submitted by the consumer in the
period described in paragraph (1)(A) with respect to such disputed information.
(5)Treatment
of Inaccurate or Unverifiable Information
(A)In general. If, after any
reinvestigation under paragraph (1) of any information disputed by a consumer,
an item of the information is found to be inaccurate or incomplete or cannot be
verified, the consumer reporting agency shall-
(i)promptly
delete that item of information from the file of the consumer, or modify that
item of information, as appropriate, based on the results of the
reinvestigation; and
(ii)promptly
notify the furnisher of that information that the information has been modified
or deleted from the file of the consumer.
(B)Requirements
Relating to Reinsertion of Previously Deleted Material
(i)Certification of accuracy of information.
If any information is deleted from a consumer’s file pursuant to subparagraph
(A), the information may not be reinserted in the file by the consumer
reporting agency unless the person who furnishes the information certifies that
the information is complete and accurate.
(ii)Notice to consumer. If any
information that has been deleted from a consumer’s file pursuant to
subparagraph (A) is reinserted in the file, the consumer reporting agency shall
notify the consumer of the reinsertion in writing not later than 5 business
days after the reinsertion or, if authorized by the consumer for that purpose,
by any other means available to the agency.
(iii)Additional information. As part of,
or in addition to, the notice under clause (ii), a consumer reporting agency
shall provide to a consumer in writing not later than 5 business days after the
date of the reinsertion
(I)a
statement that the disputed information has been reinserted;
(II)the
business name and address of any furnisher of information contacted and the
telephone number of such furnisher, if reasonably available, or of any
furnisher of information that contacted the consumer reporting agency, in
connection with the reinsertion of such information; and
(III)a
notice that the consumer has the right to add a statement to the consumer’s
file disputing the accuracy or completeness of the disputed information.
(C)Procedures to prevent reappearance.
A consumer reporting agency shall maintain reasonable procedures designed to
prevent the reappearance in a consumer’s file, and in consumer reports on the
consumer, of information that is deleted pursuant to this paragraph (other than
information that is reinserted in accordance with subparagraph (B)(i)).
(D)Automated reinvestigation system.
Any consumer reporting agency that compiles and maintains files on consumers on
a nationwide basis shall implement an automated system through which furnishers
of information to that consumer reporting agency may report the results of a
reinvestigation that finds incomplete or inaccurate information in a consumer’s
file to other such consumer reporting agencies.
(6)Notice
of Results of Reinvestigation
(A)In general. A consumer reporting
agency shall provide written notice to a consumer of the results of a
reinvestigation under this subsection not later than 5 business days after the
completion of the reinvestigation, by mail or, if authorized by the consumer
for that purpose, by other means available to the agency.
(B)Contents. As part of, or in
addition to, the notice under subparagraph (A), a consumer reporting agency
shall provide to a consumer in writing before the expiration of the 5-day period
referred to in subparagraph (A)
(i)a
statement that the reinvestigation is completed;
(ii)a
consumer report that is based upon the consumer’s file as that file is revised
as a result of the reinvestigation;
(iii)a
notice that, if requested by the consumer, a description of the procedure used
to determine the accuracy and completeness of the information shall be provided
to the consumer by the agency, including the business name and address of any
furnisher of information contacted in connection with such information and the
telephone number of such furnisher, if reasonably available;
(iv)a
notice that the consumer has the right to add a statement to the consumer’s
file disputing the accuracy or completeness of the information; and
(v)a
notice that the consumer has the right to request under subsection (d) that the
consumer reporting agency furnish notifications under that subsection.
(7)Description of reinvestigation procedure.
A consumer reporting agency shall provide to a consumer a description referred to
in paragraph (6)(B)(iii) by not later than 15 days after receiving a request
from the consumer for that description.
(8)Expedited dispute resolution. If a
dispute regarding an item of information in a consumer’s file at a consumer
reporting agency is resolved in accordance with paragraph (5)(A) by the
deletion of the disputed information by not later than 3 business days after
the date on which the agency receives notice of the dispute from the consumer
in accordance with paragraph (1)(A), then the agency shall not be required to
comply with paragraphs (2), (6), and (7) with respect to that dispute if the
agency
(A)provides
prompt notice of the deletion to the consumer by telephone;
(B)includes
in that notice, or in a written notice that accompanies a confirmation and
consumer report provided in accordance with subparagraph (C), a statement of
the consumer’s right to request under subsection (d) that the agency furnish
notifications under that subsection; and
(C)provides
written confirmation of the deletion and a copy of a consumer report on the
consumer that is based on the consumer’s file after the deletion, not later
than 5 business days after making the deletion.
(b)Statement of dispute. If the
reinvestigation does not resolve the dispute, the consumer may file a brief
statement setting forth the nature of the dispute. The consumer reporting
agency may limit such statements to not more than one hundred words if it
provides the consumer with assistance in writing a clear summary of the
dispute.
(c)Notification of consumer dispute in subsequent
consumer reports. Whenever a statement of a dispute is filed,
unless there is reasonable grounds to believe that it is frivolous or
irrelevant, the consumer reporting agency shall, in any subsequent report
containing the information in question, clearly note that it is disputed by the
consumer and provide either the consumer’s statement or a clear and accurate
codification or summary thereof.
(d)Notification of deletion of disputed
information. Following any deletion of information which is found
to be inaccurate or whose accuracy can no longer be verified or any notation as
to disputed information, the consumer reporting agency shall, at the request of
the consumer, furnish notification that the item has been deleted or the
statement, codification or summary pursuant to subsection (b) or (c) of this
section to any person specifically designated by the consumer who has within
two years prior thereto received a consumer report for employment purposes, or
within six months prior thereto received a consumer report for any other
purpose, which contained the deleted or disputed information.
(e)Treatment
of Complaints and Report to Congress
(1)In general. The Commission shall–
(A)compile
all complaints that it receives that a file of a consumer that is maintained by
a consumer reporting agency described in section 603(p) contains incomplete or
inaccurate information, with respect to which, the consumer appears to have
disputed the completeness or accuracy with the consumer reporting agency or
otherwise utilized the procedures provided by subsection (a); and
(B)transmit
each such complaint to each consumer reporting agency involved.
(2)Exclusion. Complaints received or
obtained by the Commission pursuant to its investigative authority under the
Federal Trade Commission Act shall not be subject to paragraph (1).
(3)Agency responsibilities. Each
consumer reporting agency described in section 603(p) that receives a complaint
transmitted by the Commission pursuant to paragraph (1) shall–
(A)review
each such complaint to determine whether all legal obligations imposed on the
consumer reporting agency under this title (including any obligation imposed by
an applicable court or administrative order) have been met with respect to the
subject matter of the complaint;
(B)provide
reports on a regular basis to the Commission regarding the determinations of
and actions taken by the consumer reporting agency, if any, in connection with
its review of such complaints; and
(C)maintain,
for a reasonable time period, records regarding the disposition of each such
complaint that is sufficient to demonstrate compliance with this subsection.
(4)Rulemaking authority. The
Commission may prescribe regulations, as appropriate to implement this
subsection.
(5)Annual report. The Commission shall
submit to the Committee on Banking, Housing, and Urban Affairs of the Senate
and the Committee on Financial Services of the House of Representatives an
annual report regarding information gathered by the Commission under this
subsection.
(f)Reinvestigation
Requirement Applicable to Resellers
(1)Exemption from general reinvestigation
requirement. Except as provided in paragraph (2), a reseller shall
be exempt from the requirements of this section.
(2)Action required upon receiving notice of a
dispute. If a reseller receives a notice from a consumer of a
dispute concerning the completeness or accuracy of any item of information
contained in a consumer report on such consumer produced by the reseller, the
reseller shall, within 5 business days of receiving the notice, and free of
charge-
(A)determine
whether the item of information is incomplete or inaccurate as a result of an
act or omission of the reseller; and
(B)if
(i) the reseller determines that the item of information is incomplete or
inaccurate as a result of an act or omission of the reseller, not later than 20
days after receiving the notice, correct the information in the consumer report
or delete it; or (ii) if the reseller determines that the item of information is
not incomplete or inaccurate as a result of an act or omission of the reseller,
convey the notice of the dispute, together with all relevant information
provided by the consumer, to each consumer reporting agency that provided the
reseller with the information that is the subject of the dispute, using an
address or a notification mechanism specified by the consumer reporting agency
for such notices.
(3)Responsibility of consumer reporting agency to
notify consumer through reseller. Upon the completion of a
reinvestigation under this section of a dispute concerning the completeness or
accuracy of any information in the file of a consumer by a consumer reporting
agency that received notice of the dispute from a reseller under paragraph
(2)–
(A)the
notice by the consumer reporting agency under paragraph (6), (7), or (8) of
subsection (a) shall be provided to the reseller in lieu of the consumer; and
(B)the
reseller shall immediately reconvey such notice to the consumer, including any
notice of a deletion by telephone in the manner required under paragraph
(8)(A).
(4)Reseller reinvestigations. No
provision of this subsection shall be construed as prohibiting a reseller from
conducting a reinvestigation of a consumer dispute directly.
612.
Charges for certain disclosures [15 U.S.C. § 1681j]
See also 16 CFR Part 610
69 Fed. Reg. 35467 (06/24/04)
(a)Free
Annual Disclosure
(1)Nationwide
Consumer Reporting Agencies
(A)In general. All consumer reporting
agencies described in subsections (p) and (w) of section 603 shall make all
disclosures pursuant to section 609 once during any 12-month period upon
request of the consumer and without charge to the consumer.
(B)Centralized source. Subparagraph
(A) shall apply with respect to a consumer reporting agency described in section
603(p) only if the request from the consumer is made using the centralized
source established for such purpose in accordance with section 211(c) of the
Fair and Accurate Credit Transactions Act of 2003.
(C)Nationwide
Specialty Consumer Reporting Agency
(i)In general. The Commission shall
prescribe regulations applicable to each consumer reporting agency described in
section 603(w) to require the establishment of a streamlined process for
consumers to request consumer reports under subparagraph (A), which shall
include, at a minimum, the establishment by each such agency of a toll-free
telephone number for such requests.
(ii)Considerations. In prescribing
regulations under clause (i), the Commission shall consider-
(I)the
significant demands that may be placed on consumer reporting agencies in
providing such consumer reports;
(II)appropriate
means to ensure that consumer reporting agencies can satisfactorily meet those
demands, including the efficacy of a system of staggering the availability to
consumers of such consumer reports; and
(III)the
ease by which consumers should be able to contact consumer reporting agencies
with respect to access to such consumer reports.
(iii)Date of issuance. The Commission
shall issue the regulations required by this subparagraph in final form not
later than 6 months after the date of enactment of the Fair and Accurate Credit
Transactions Act of 2003.
(iv)Consideration of ability to comply.
The regulations of the Commission under this subparagraph shall establish an
effective date by which each nationwide specialty consumer reporting agency (as
defined in section 603(w)) shall be required to comply with subsection (a),
which effective date–
(I)shall
be established after consideration of the ability of each nationwide specialty
consumer reporting agency to comply with subsection (a); and
(II)shall
be not later than 6 months after the date on which such regulations are issued
in final form (or such additional period not to exceed 3 months, as the
Commission determines appropriate).
(2)Timing. A consumer reporting agency
shall provide a consumer report under paragraph (1) not later than 15 days
after the date on which the request is received under paragraph (1).
(3)Reinvestigations. Notwithstanding
the time periods specified in section 611(a)(1), a reinvestigation under that
section by a consumer reporting agency upon a request of a consumer that is
made after receiving a consumer report under this subsection shall be completed
not later than 45 days after the date on which the request is received.
(4)Exception for first 12 months of operation.
This subsection shall not apply to a consumer reporting agency that has not
been furnishing consumer reports to third parties on a continuing basis during
the 12-month period preceding a request under paragraph (1), with respect to
consumers residing nationwide.
(b)Free disclosure after adverse notice to
consumer. Each consumer reporting agency that maintains a file on a
consumer shall make all disclosures pursuant to section 609 [§ 1681g] without
charge to the consumer if, not later than 60 days after receipt by such
consumer of a notification pursuant to section 615 [§ 1681m], or of a
notification from a debt collection agency affiliated with that consumer
reporting agency stating that the consumer’s credit rating may be or has been
adversely affected, the consumer makes a request under section 609 [§ 1681g].
(c)Free disclosure under certain other
circumstances. Upon the request of the consumer, a consumer
reporting agency shall make all disclosures pursuant to section 609 [§ 1681g]
once during any 12-month period without charge to that consumer if the consumer
certifies in writing that the consumer
(1)is
unemployed and intends to apply for employment in the 60-day period beginning
on the date on which the certification is made;
(2)is
a recipient of public welfare assistance; or
(3)has
reason to believe that the file on the consumer at the agency contains
inaccurate information due to fraud.
(d)Free disclosures in connection with fraud
alerts. Upon the request of a consumer, a consumer reporting agency
described in section 603(p) shall make all disclosures pursuant to section 609
without charge to the consumer, as provided in subsections (a)(2) and (b)(2) of
section 605A, as applicable.
(e)Other charges prohibited A consumer reporting agency shall not
impose any charge on a consumer for providing any notification required by this
title or making any disclosure required by this title, except as authorized by
subsection (f).
(f)Reasonable
Charges Allowed for Certain Disclosures
(1)In general. In the case of a
request from a consumer other than a request that is covered by any of
subsections (a) through (d), a consumer reporting agency may impose a
reasonable charge on a consumer
(A)for
making a disclosure to the consumer pursuant to section 609 [§ 1681g], which
charge
(i)shall
not exceed $8;4 and
(ii)shall
be indicated to the consumer before making the disclosure; and
(B)for
furnishing, pursuant to 611(d) [§ 1681i], following a reinvestigation under
section 611(a) [§ 1681i], a statement, codification, or summary to a person
designated by the consumer under that section after the 30-day period beginning
on the date of notification of the consumer under paragraph (6) or (8) of
section 611(a) [§ 1681i] with respect to the reinvestigation, which charge
(i)shall
not exceed the charge that the agency would impose on each designated recipient
for a consumer report; and
(ii)shall
be indicated to the consumer before furnishing such information.
(2)Modification of amount. The Federal
Trade Commission shall increase the amount referred to in paragraph (1)(A)(i)
on January 1 of each year, based proportionally on changes in the Consumer
Price Index, with fractional changes rounded to the nearest fifty cents.
613.
Public record information for employment purposes [15
U.S.C. § 1681k]
(a)In general. A consumer reporting
agency which furnishes a consumer report for employment purposes and which for
that purpose compiles and reports items of information on consumers which are
matters of public record and are likely to have an adverse effect upon a
consumer’s ability to obtain employment shall
(1)at
the time such public record information is reported to the user of such
consumer report, notify the consumer of the fact that public record information
is being reported by the consumer reporting agency, together with the name and
address of the person to whom such information is being reported; or
(2)maintain
strict procedures designed to insure that whenever public record information
which is likely to have an adverse effect on a consumer’s ability to obtain
employment is reported it is complete and up to date. For purposes of this
paragraph, items of public record relating to arrests, indictments,
convictions, suits, tax liens, and outstanding judgments shall be considered up
to date if the current public record status of the item at the time of the
report is reported.
(b)Exemption for national security investigations.
Subsection (a) does not apply in the case of an agency or department of the
United States Government that seeks to obtain and use a consumer report for
employment purposes, if the head of the agency or department makes a written
finding as prescribed under section 604(b)(4)(A).
614.
Restrictions on investigative consumer reports [15
U.S.C. § 1681l]
Whenever
a consumer reporting agency prepares an investigative consumer report, no
adverse information in the consumer report (other than information which is a
matter of public record) may be included in a subsequent consumer report unless
such adverse information has been verified in the process of making such
subsequent consumer report, or the adverse information was received within the three-month
period preceding the date the subsequent report is furnished.
615.
Requirements on users of consumer reports [15 U.S.C. § 1681m]
(a)Duties of users taking adverse actions on the
basis of information contained in consumer reports. If any person takes
any adverse action with respect to any consumer that is based in whole or in
part on any information contained in a consumer report, the person shall
(1)provide
oral, written, or electronic notice of the adverse action to the consumer;
(2)provide
to the consumer orally, in writing, or electronically
(A)the
name, address, and telephone number of the consumer reporting agency (including
a toll-free telephone number established by the agency if the agency compiles
and maintains files on consumers on a nationwide basis) that furnished the
report to the person; and
(B)a
statement that the consumer reporting agency did not make the decision to take
the adverse action and is unable to provide the consumer the specific reasons
why the adverse action was taken; and
(3)provide
to the consumer an oral, written, or electronic notice of the consumer’s right
(A)to
obtain, under section 612 [§ 1681j], a free copy of a consumer report on the
consumer from the consumer reporting agency referred to in paragraph (2), which
notice shall include an indication of the 60-day period under that section for
obtaining such a copy; and
(B)to
dispute, under section 611 [§ 1681i], with a consumer reporting agency the
accuracy or completeness of any information in a consumer report furnished by
the agency.
(b)Adverse
Action Based on Information Obtained from Third Parties Other than Consumer
Reporting Agencies
(1)In general. Whenever credit for
personal, family, or household purposes involving a consumer is denied or the
charge for such credit is increased either wholly or partly because of
information obtained from a person other than a consumer reporting agency
bearing upon the consumer’s credit worthiness, credit standing, credit
capacity, character, general reputation, personal characteristics, or mode of
living, the user of such information shall, within a reasonable period of time,
upon the consumer’s written request for the reasons for such adverse action
received within sixty days after learning of such adverse action, disclose the
nature of the information to the consumer. The user of such information shall
clearly and accurately disclose to the consumer his right to make such written
request at the time such adverse action is communicated to the consumer.
(2)Duties
of Person Taking Certain Actions Based on Information Provided by Affiliate
(A)Duties, generally. If a person
takes an action described in subparagraph (B) with respect to a consumer, based
in whole or in part on information described in subparagraph (C), the person shall
(i)notify
the consumer of the action, including a statement that the consumer may obtain
the information in accordance with clause (ii); and
(ii)upon
a written request from the consumer received within 60 days after transmittal
of the notice required by clause (i), disclose to the consumer the nature of
the information upon which the action is based by not later than 30 days after
receipt of the request.
(B)Action described. An action
referred to in subparagraph (A) is an adverse action described in section
603(k)(1)(A) [§ 1681a], taken in connection with a transaction initiated by the
consumer, or any adverse action described in clause (i) or (ii) of section
603(k)(1)(B) [§ 1681a].
(C)Information described. Information
referred to in subparagraph (A)
(i)except
as provided in clause (ii), is information that
(I)is
furnished to the person taking the action by a person related by common
ownership or affiliated by common corporate control to the person taking the
action; and
(II)bears
on the credit worthiness, credit standing, credit capacity, character, general
reputation, personal characteristics, or mode of living of the consumer; and
(ii)does
not include
(I)information
solely as to transactions or experiences between the consumer and the person
furnishing the information; or
(II)information
in a consumer report.
(c)Reasonable procedures to assure compliance.
No person shall be held liable for any violation of this section if he shows by
a preponderance of the evidence that at the time of the alleged violation he
maintained reasonable procedures to assure compliance with the provisions of
this section.
(d)Duties
of Users Making Written Credit or Insurance Solicitations on the Basis of
Information Contained in Consumer Files
(1)In general. Any person who uses a
consumer report on any consumer in connection with any credit or insurance
transaction that is not initiated by the consumer, that is provided to that
person under section 604(c)(1)(B) [§ 1681b], shall provide with each written
solicitation made to the consumer regarding the transaction a clear and
conspicuous statement that
(A)information
contained in the consumer’s consumer report was used in connection with the
transaction;
(B)the
consumer received the offer of credit or insurance because the consumer
satisfied the criteria for credit worthiness or insurability under which the
consumer was selected for the offer;
(C)if
applicable, the credit or insurance may not be extended if, after the consumer
responds to the offer, the consumer does not meet the criteria used to select
the consumer for the offer or any applicable criteria bearing on credit
worthiness or insurability or does not furnish any required collateral;
(D)the
consumer has a right to prohibit information contained in the consumer’s file
with any consumer reporting agency from being used in connection with any
credit or insurance transaction that is not initiated by the consumer; and
(E)the
consumer may exercise the right referred to in subparagraph (D) by notifying a
notification system established under section 604(e) [§ 1681b].
(2)Disclosure of address and telephone number;
format. A statement under paragraph(1) shall–
(A)include
the address and toll-free telephone number of the appropriate notification
system established under section 604(e); and
(B)be
presented in such format and in such type size and manner as to be simple and
easy to understand, as established by the Commission, by rule, in consultation
with the Federal banking agencies and the National Credit Union Administration.
See also 16 CFR Part 642
16 CFR Part 698 App A
70 Fed. Reg. 5022 (01/31/05)
(3)Maintaining criteria on file. A
person who makes an offer of credit or insurance to a consumer under a credit
or insurance transaction described in paragraph (1) shall maintain on file the
criteria used to select the consumer to receive the offer, all criteria bearing
on credit worthiness or insurability, as applicable, that are the basis for
determining whether or not to extend credit or insurance pursuant to the offer,
and any requirement for the furnishing of collateral as a condition of the
extension of credit or insurance, until the expiration of the 3-year period
beginning on the date on which the offer is made to the consumer.
(4)Authority of federal agencies regarding unfair
or deceptive acts or practices not affected. This section is not
intended to affect the authority of any Federal or State agency to enforce a
prohibition against unfair or deceptive acts or practices, including the making
of false or misleading statements in connection with a credit or insurance
transaction that is not initiated by the consumer.
(e)Red
Flag Guidelines and Regulations Required
(1)Guidelines. The Federal banking
agencies, the National Credit Union Administration, and the Commission shall
jointly, with respect to the entities that are subject to their respective
enforcement authority under section 621-
(A)establish
and maintain guidelines for use by each financial institution and each creditor
regarding identity theft with respect to account holders at, or customers of,
such entities, and update such guidelines as often as necessary;
(B)prescribe
regulations requiring each financial institution and each creditor to establish
reasonable policies and procedures for implementing the guidelines established
pursuant to subparagraph (A), to identify possible risks to account holders or
customers or to the safety and soundness of the institution or customers; and
(C)prescribe
regulations applicable to card issuers to ensure that, if a card issuer
receives notification of a change of address for an existing account, and
within a short period of time (during at least the first 30 days after such
notification is received) receives a request for an additional or replacement
card for the same account, the card issuer may not issue the additional or
replacement card, unless the card issuer, in accordance with reasonable
policies and procedures-
(i)notifies
the cardholder of the request at the former address of the cardholder and
provides to the cardholder a means of promptly reporting incorrect address
changes;
(ii)notifies
the cardholder of the request by such other means of communication as the
cardholder and the card issuer previously agreed to; or
(iii)uses
other means of assessing the validity of the change of address, in accordance
with reasonable policies and procedures established by the card issuer in
accordance with the regulations prescribed under subparagraph (B).
(2)Criteria
(A)In general. In developing the
guidelines required by paragraph (1)(A), the agencies described in paragraph
(1) shall identify patterns, practices, and specific forms of activity that
indicate the possible existence of identity theft.
(B)Inactive accounts. In developing
the guidelines required by paragraph (1)(A), the agencies described in
paragraph (1) shall consider including reasonable guidelines providing that
when a transaction occurs with respect to a credit or deposit account that has
been inactive for more than 2 years, the creditor or financial institution
shall follow reasonable policies and procedures that provide for notice to be
given to a consumer in a manner reasonably designed to reduce the likelihood of
identity theft with respect to such account.
(3)Consistency with verification requirements.
Guidelines established pursuant to paragraph (1) shall not be inconsistent with
the policies and procedures required under section 5318(l) of title 31, United
States Code.
(f)Prohibition
on Sale or Transfer of Debt Caused by Identity Theft
(1)In general. No person shall sell,
transfer for consideration, or place for collection a debt that such person has
been notified under section 605B has resulted from identity theft.
(2)Applicability. The prohibitions of
this subsection shall apply to all persons collecting a debt described in
paragraph (1) after the date of a notification under paragraph (1).
(3)Rule of construction. Nothing in
this subsection shall be construed to prohibit–
(A)the
repurchase of a debt in any case in which the assignee of the debt requires
such repurchase because the debt has resulted from identity theft;
(B)the
securitization of a debt or the pledging of a portfolio of debt as collateral
in connection with a borrowing; or
(C)the
transfer of debt as a result of a merger, acquisition, purchase and assumption
transaction, or transfer of substantially all of the assets of an entity.
(g)Debt collector communications concerning
identity theft. If a person acting as a debt collector (as that
term is defined in title VIII) on behalf of a third party that is a creditor or
other user of a consumer report is notified that any information relating to a
debt that the person is attempting to collect may be fraudulent or may be the
result of identity theft, that person shall–
(1)notify
the third party that the information may be fraudulent or may be the result of
identity theft; and
(2)upon
request of the consumer to whom the debt purportedly relates, provide to the
consumer all information to which the consumer would otherwise be entitled if
the consumer were not a victim of identity theft, but wished to dispute the
debt under provisions of law applicable to that person.
(h)Duties
of Users in Certain Credit Transactions
(1)In general. Subject to rules
prescribed as provided in paragraph (6), if any person uses a consumer report
in connection with an application for, or a grant, extension, or other
provision of, credit on material terms that are materially less favorable than
the most favorable terms available to a substantial proportion of consumers
from or through that person, based in whole or in part on a consumer report,
the person shall provide an oral, written, or electronic notice to the consumer
in the form and manner required by regulations prescribed in accordance with
this subsection.
(2)Timing. The notice required under
paragraph (1) may be provided at the time of an application for, or a grant,
extension, or other provision of, credit or the time of communication of an
approval of an application for, or grant, extension, or other provision of,
credit, except as provided in the regulations prescribed under paragraph (6).
(3)Exceptions. No notice shall be
required from a person under this subsection if-
(A)the
consumer applied for specific material terms and was granted those terms,
unless those terms were initially specified by the person after the transaction
was initiated by the consumer and after the person obtained a consumer report;
or
(B)the
person has provided or will provide a notice to the consumer under subsection
(a) in connection with the transaction.
(4)Other notice not sufficient. A
person that is required to provide a notice under subsection (a) cannot meet
that requirement by providing a notice under this subsection.
(5)Content and delivery of notice. A
notice under this subsection shall, at a minimum-
(A)include
a statement informing the consumer that the terms offered to the consumer are
set based on information from a consumer report;
(B)identify
the consumer reporting agency furnishing the report;
(C)include
a statement informing the consumer that the consumer may obtain a copy of a
consumer report from that consumer reporting agency without charge; and
(D)include
the contact information specified by that consumer reporting agency for
obtaining such consumer reports (including a toll-free telephone number
established by the agency in the case of a consumer reporting agency described
in section 603(p)).
(6)Rulemaking
(A)Rules required. The Commission and
the Board shall jointly prescribe rules.
(B)Content. Rules required by
subparagraph (A) shall address, but are not limited to-
(i)the
form, content, time, and manner of delivery of any notice under this
subsection;
(ii)clarification
of the meaning of terms used in this subsection, including what credit terms
are material, and when credit terms are materially less favorable;
(iii)exceptions
to the notice requirement under this subsection for classes of persons or
transactions regarding which the agencies determine that notice would not
significantly benefit consumers;
(iv)a
model notice that may be used to comply with this subsection; and
(v)the
timing of the notice required under paragraph (1), including the circumstances
under which the notice must be provided after the terms offered to the consumer
were set based on information from a consumer report.
(7)Compliance. A person shall not be
liable for failure to perform the duties required by this section if, at the
time of the failure, the person maintained reasonable policies and procedures
to comply with this section.
(8)Enforcement
(A)No civil actions. Sections 616 and
617 shall not apply to any failure by any person to comply with this section.
(B)Administrative enforcement. This
section shall be enforced exclusively under section 621 by the Federal agencies
and officials identified in that section.
616.
Civil liability for willful noncompliance [15 U.S.C. § 1681n]
(a)In general. Any person who
willfully fails to comply with any requirement imposed under this title with
respect to any consumer is liable to that consumer in an amount equal to the
sum of
(1)
(A)any
actual damages sustained by the consumer as a result of the failure or damages
of not less than $100 and not more than $1,000; or
(B)in
the case of liability of a natural person for obtaining a consumer report under
false pretenses or knowingly without a permissible purpose, actual damages
sustained by the consumer as a result of the failure or $1,000, whichever is
greater;
(2)such
amount of punitive damages as the court may allow; and
(3)in
the case of any successful action to enforce any liability under this section,
the costs of the action together with reasonable attorney’s fees as determined
by the court.
(b)Civil liability for knowing noncompliance.
Any person who obtains a consumer report from a consumer reporting agency under
false pretenses or knowingly without a permissible purpose shall be liable to
the consumer reporting agency for actual damages sustained by the consumer
reporting agency or $1,000, whichever is greater.
(c)Attorney’s fees. Upon a finding by
the court that an unsuccessful pleading, motion, or other paper filed in
connection with an action under this section was filed in bad faith or for
purposes of harassment, the court shall award to the prevailing party
attorney’s fees reasonable in relation to the work expended in responding to
the pleading, motion, or other paper.
617.
Civil liability for negligent noncompliance [15 U.S.C. § 1681o]
(a)In general. Any person who is
negligent in failing to comply with any requirement imposed under this title
with respect to any consumer is liable to that consumer in an amount equal to
the sum of
(1)any
actual damages sustained by the consumer as a result of the failure; and
(2)in
the case of any successful action to enforce any liability under this section,
the costs of the action together with reasonable attorney’s fees as determined
by the court.
(b)Attorney’s fees. On a finding by
the court that an unsuccessful pleading, motion, or other paper filed in
connection with an action under this section was filed in bad faith or for
purposes of harassment, the court shall award to the prevailing party
attorney’s fees reasonable in relation to the work expended in responding to
the pleading, motion, or other paper.
618.
Jurisdiction of courts; limitation of actions [15 U.S.C. § 1681p]
An
action to enforce any liability created under this title may be brought in any
appropriate United States district court, without regard to the amount in
controversy, or in any other court of competent jurisdiction, not later than
the earlier of (1) 2 years after the date of discovery by the plaintiff of the
violation that is the basis for such liability; or (2) 5 years after the date
on which the violation that is the basis for such liability occurs.
619.
Obtaining information under false pretenses [15 U.S.C. § 1681q]
Any
person who knowingly and willfully obtains information on a consumer from a
consumer reporting agency under false pretenses shall be fined under title 18,
United States Code, imprisoned for not more than 2 years, or both.
620.
Unauthorized disclosures by officers or employees [15
U.S.C. § 1681r]
Any
officer or employee of a consumer reporting agency who knowingly and willfully
provides information concerning an individual from the agency’s files to a
person not authorized to receive that information shall be fined under title
18, United States Code, imprisoned for not more than 2 years, or both.
621.
Administrative enforcement [15 U.S.C. § 1681s]
(a)
(1)Enforcement by Federal Trade Commission.
Compliance with the requirements imposed under this title shall be enforced
under the Federal Trade Commission Act [15 U.S.C. §§ 41 et seq.] by the Federal
Trade Commission with respect to consumer reporting agencies and all other
persons subject thereto, except to the extent that enforcement of the
requirements imposed under this title is specifically committed to some other
government agency under subsection (b) hereof. For the purpose of the exercise
by the Federal Trade Commission of its functions and powers under the Federal
Trade Commission Act, a violation of any requirement or prohibition imposed
under this title shall constitute an unfair or deceptive act or practice in
commerce in violation of section 5(a) of the Federal Trade Commission Act [15
U.S.C. § 45(a)] and shall be subject to enforcement by the Federal Trade
Commission under section 5(b) thereof [15 U.S.C. § 45(b)] with respect to any
consumer reporting agency or person subject to enforcement by the Federal Trade
Commission pursuant to this subsection, irrespective of whether that person is
engaged in commerce or meets any other jurisdictional tests in the Federal
Trade Commission Act. The Federal Trade Commission shall have such procedural,
investigative, and enforcement powers, including the power to issue procedural
rules in enforcing compliance with the requirements imposed under this title
and to require the filing of reports, the production of documents, and the
appearance of witnesses as though the applicable terms and conditions of the
Federal Trade Commission Act were part of this title. Any person violating any
of the provisions of this title shall be subject to the penalties and entitled
to the privileges and immunities provided in the Federal Trade Commission Act
as though the applicable terms and provisions thereof were part of this title.
(2)
(A)In
the event of a knowing violation, which constitutes a pattern or practice of
violations of this title, the Commission may commence a civil action to recover
a civil penalty in a district court of the United States against any person
that violates this title. In such action, such person shall be liable for a
civil penalty of not more than $2,500 per violation.
(B)In
determining the amount of a civil penalty under subparagraph (A), the court
shall take into account the degree of culpability, any history of prior such
conduct, ability to pay, effect on ability to continue to do business, and such
other matters as justice may require.
(3)Notwithstanding
paragraph (2), a court may not impose any civil penalty on a person for a
violation of section 623(a)(1) [§ 1681s-2] unless the person has been enjoined
from committing the violation, or ordered not to commit the violation, in an
action or proceeding brought by or on behalf of the Federal Trade Commission,
and has violated the injunction or order, and the court may not impose any
civil penalty for any violation occurring before the date of the violation of
the injunction or order.
(b)Enforcement by other agencies.
Compliance with the requirements imposed under this title with respect to
consumer reporting agencies, persons who use consumer reports from such
agencies, persons who furnish information to such agencies, and users of
information that are subject to subsection (d) of section 615 [§ 1681m] shall
be enforced under
(1)section
8 of the Federal Deposit Insurance Act [12 U.S.C. § 1818], in the case of
(A)national
banks, and Federal branches and Federal agencies of foreign banks, by the
Office of the Comptroller of the Currency;
(B)member
banks of the Federal Reserve System (other than national banks), branches and
agencies of foreign banks (other than Federal branches, Federal agencies, and
insured State branches of foreign banks), commercial lending companies owned or
controlled by foreign banks, and organizations operating under section 25 or
25A of the Federal Reserve Act [12 U.S.C. §§ 601 et seq., §§ 611 et seq], by
the Board of Governors of the Federal Reserve System; and
(C)banks
insured by the Federal Deposit Insurance Corporation (other than members of the
Federal Reserve System) and insured State branches of foreign banks, by the
Board of Directors of the Federal Deposit Insurance Corporation;
(2)section
8 of the Federal Deposit Insurance Act [12 U.S.C. § 1818], by the Director of
the Office of Thrift Supervision, in the case of a savings association the
deposits of which are insured by the Federal Deposit Insurance Corporation;
(3)the
Federal Credit Union Act [12 U.S.C. §§ 1751 et seq.], by the Administrator of
the National Credit Union Administration [National Credit Union Administration
Board] with respect to any Federal credit union;
(4)subtitle
IV of title 49 [49 U.S.C. §§ 10101 et seq.], by the Secretary of
Transportation, with respect to all carriers subject to the jurisdiction of the
Surface Transportation Board;
(5)the
Federal Aviation Act of 1958 [49 U.S.C. Appx §§ 1301 et seq.], by the Secretary
of Transportation with respect to any air carrier or foreign air carrier
subject to that Act [49 U.S.C. Appx §§ 1301 et seq.]; and
(6)the
Packers and Stockyards Act, 1921 [7 U.S.C. §§ 181 et seq.] (except as provided
in section 406 of that Act [7 U.S.C. §§ 226 and 227]), by the Secretary of
Agriculture with respect to any activities subject to that Act.
The
terms used in paragraph (1) that are not defined in this title or otherwise
defined in section 3(s) of the Federal Deposit Insurance Act (12 U.S.C.
§1813(s)) shall have the meaning given to them in section 1(b) of the
International Banking Act of 1978 (12 U.S.C. § 3101).
(c)State
Action for Violations
(1)Authority of states. In addition to
such other remedies as are provided under State law, if the chief law
enforcement officer of a State, or an official or agency designated by a State,
has reason to believe that any person has violated or is violating this title,
the State
(A)may
bring an action to enjoin such violation in any appropriate United States
district court or in any other court of competent jurisdiction;
(B)subject
to paragraph (5), may bring an action on behalf of the residents of the State
to recover
(i)damages
for which the person is liable to such residents under sections 616 and 617 [§§
1681n and 1681o] as a result of the violation;
(ii)in
the case of a violation described in any of paragraphs (1) through (3) of
section 623(c), damages for which the person would, but for section 623(c) [§
1681s-2], be liable to such residents as a result of the violation; or
(iii)damages
of not more than $1,000 for each willful or negligent violation; and
(C)in
the case of any successful action under subparagraph (A) or (B), shall be
awarded the costs of the action and reasonable attorney fees as determined by
the court.
(2)Rights of federal regulators. The
State shall serve prior written notice of any action under paragraph (1) upon
the Federal Trade Commission or the appropriate Federal regulator determined
under subsection (b) and provide the Commission or appropriate Federal
regulator with a copy of its complaint, except in any case in which such prior
notice is not feasible, in which case the State shall serve such notice
immediately upon instituting such action. The Federal Trade Commission or
appropriate Federal regulator shall have the right
(A)to
intervene in the action;
(B)upon
so intervening, to be heard on all matters arising therein;
(C)to
remove the action to the appropriate United States district court; and
(D)to
file petitions for appeal.
(3)Investigatory powers. For purposes
of bringing any action under this subsection, nothing in this subsection shall
prevent the chief law enforcement officer, or an official or agency designated
by a State, from exercising the powers conferred on the chief law enforcement
officer or such official by the laws of such State to conduct investigations or
to administer oaths or affirmations or to compel the attendance of witnesses or
the production of documentary and other evidence.
(4)Limitation on state action while federal action
pending. If the Federal Trade Commission or the appropriate Federal
regulator has instituted a civil action or an administrative action under
section 8 of the Federal Deposit Insurance Act for a violation of this title,
no State may, during the pendency of such action, bring an action under this
section against any defendant named in the complaint of the Commission or the
appropriate Federal regulator for any violation of this title that is alleged
in that complaint.
(5)Limitations
on State Actions for Certain Violations
(A)Violation of injunction required. A
State may not bring an action against a person under paragraph (1)(B) for a
violation described in any of paragraphs (1) through (3) of section 623(c),
unless
(i)the
person has been enjoined from committing the violation, in an action brought by
the State under paragraph (1)(A); and
(ii)the
person has violated the injunction.
(B)Limitation on damages recoverable.
In an action against a person under paragraph (1)(B) for a violation described
in any of paragraphs (1) through (3) of section 623(c), a State may not recover
any damages incurred before the date of the violation of an injunction on which
the action is based.
(d)Enforcement under other authority. For the purpose of the exercise by any
agency referred to in subsection (b) of this section of its powers under any
Act referred to in that subsection, a violation of any requirement imposed
under this title shall be deemed to be a violation of a requirement imposed
under that Act. In addition to its powers under any provision of law
specifically referred to in subsection (b) of this section, each of the
agencies referred to in that subsection may exercise, for the purpose of enforcing
compliance with any requirement imposed under this title any other authority
conferred on it by law.
(e)Regulatory
authority
(1)The
Federal banking agencies referred to in paragraphs (1) and (2) of subsection
(b) shall jointly prescribe such regulations as necessary to carry out the
purposes of this Act with respect to any persons identified under paragraphs
(1) and (2) of subsection (b), and the Board of Governors of the Federal
Reserve System shall have authority to prescribe regulations consistent with
such joint regulations with respect to bank holding companies and affiliates
(other than depository institutions and consumer reporting agencies) of such
holding companies.
(2)The
Board of the National Credit Union Administration shall prescribe such
regulations as necessary to carry out the purposes of this Act with respect to
any persons identified under paragraph (3) of subsection (b).
(f)Coordination
of Consumer Complaint Investigations
(1)In general. Each consumer reporting
agency described in section 603(p) shall develop and maintain procedures for
the referral to each other such agency of any consumer complaint received by
the agency alleging identity theft, or requesting a fraud alert under section
605A or a block under section 605B.
(2)Model form and procedure for reporting identity
theft. The Commission, in consultation with the Federal banking
agencies and the National Credit Union Administration, shall develop a model
form and model procedures to be used by consumers who are victims of identity
theft for contacting and informing creditors and consumer reporting agencies of
the fraud.
See also 70 Fed.Reg. 21792 (04/27/05)
(3)Annual summary reports. Each
consumer reporting agency described in section 603(p) shall submit an annual
summary report to the Commission on consumer complaints received by the agency
on identity theft or fraud alerts.
(g)FTC regulation of coding of trade names.
If the Commission determines that a person described in paragraph (9) of
section 623(a) has not met the requirements of such paragraph, the Commission
shall take action to ensure the person’s compliance with such paragraph, which
may include issuing model guidance or prescribing reasonable policies and
procedures, as necessary to ensure that such person complies with such
paragraph.
622.
Information on overdue child support obligations [15
U.S.C. § 1681s-1]
Notwithstanding
any other provision of this title, a consumer reporting agency shall include in
any consumer report furnished by the agency in accordance with section 604 [§
1681b] of this title, any information on the failure of the consumer to pay
overdue support which
(1)is
provided
(A)to
the consumer reporting agency by a State or local child support enforcement
agency; or
(B)to
the consumer reporting agency and verified by any local, State, or Federal
government agency; and
(2)antedates
the report by 7 years or less.
623.
Responsibilities of furnishers of information to consumer reporting agencies [15
U.S.C. § 1681s-2]
(a)Duty
of Furnishers of Information to Provide Accurate Information
(1)Prohibition
(A)Reporting information with actual knowledge of
errors. A person shall not furnish any information relating to a
consumer to any consumer reporting agency if the person knows or has reasonable
cause to believe that the information is inaccurate.
(B)Reporting information after notice and
confirmation of errors. A person shall not furnish information
relating to a consumer to any consumer reporting agency if
(i)the
person has been notified by the consumer, at the address specified by the
person for such notices, that specific information is inaccurate; and
(ii)the
information is, in fact, inaccurate.
(C)No address requirement. A person
who clearly and conspicuously specifies to the consumer an address for notices
referred to in subparagraph (B) shall not be subject to subparagraph (A);
however, nothing in subparagraph (B) shall require a person to specify such an
address.
(D)Definition. For purposes of
subparagraph (A), the term “reasonable cause to believe that the information
is inaccurate” means having specific knowledge, other than solely
allegations by the consumer, that would cause a reasonable person to have
substantial doubts about the accuracy of the information.
(2)Duty to correct and update information.
A person who
(A)regularly
and in the ordinary course of business furnishes information to one or more
consumer reporting agencies about the person’s transactions or experiences with
any consumer; and
(B)has
furnished to a consumer reporting agency information that the person determines
is not complete or accurate, shall promptly notify the consumer reporting
agency of that determination and provide to the agency any corrections to that
information, or any additional information, that is necessary to make the information
provided by the person to the agency complete and accurate, and shall not
thereafter furnish to the agency any of the information that remains not
complete or accurate.
(3)Duty to provide notice of dispute.
If the completeness or accuracy of any information furnished by any person to
any consumer reporting agency is disputed to such person by a consumer, the
person may not furnish the information to any consumer reporting agency without
notice that such information is disputed by the consumer.
(4)Duty to provide notice of closed accounts.
A person who regularly and in the ordinary course of business furnishes
information to a consumer reporting agency regarding a consumer who has a
credit account with that person shall notify the agency of the voluntary
closure of the account by the consumer, in information regularly furnished for
the period in which the account is closed.
(5)Duty
to Provide Notice of Delinquency of Accounts
(A)In general. A person who furnishes
information to a consumer reporting agency regarding a delinquent account being
placed for collection, charged to profit or loss, or subjected to any similar
action shall, not later than 90 days after furnishing the information, notify
the agency of the date of delinquency on the account, which shall be the month
and year of the commencement of the delinquency on the account that immediately
preceded the action.
(B)Rule of construction. For purposes
of this paragraph only, and provided that the consumer does not dispute the
information, a person that furnishes information on a delinquent account that
is placed for collection, charged for profit or loss, or subjected to any
similar action, complies with this paragraph, if-
(i)the
person reports the same date of delinquency as that provided by the creditor to
which the account was owed at the time at which the commencement of the
delinquency occurred, if the creditor previously reported that date of
delinquency to a consumer reporting agency;
(ii)the
creditor did not previously report the date of delinquency to a consumer
reporting agency, and the person establishes and follows reasonable procedures
to obtain the date of delinquency from the creditor or another reliable source
and reports that date to a consumer reporting agency as the date of delinquency;
or
(iii)the
creditor did not previously report the date of delinquency to a consumer
reporting agency and the date of delinquency cannot be reasonably obtained as
provided in clause (ii), the person establishes and follows reasonable
procedures to ensure the date reported as the date of delinquency precedes the
date on which the account is placed for collection, charged to profit or loss,
or subjected to any similar action, and reports such date to the credit
reporting agency.
(6)Duties
of Furnishers Upon Notice of Identity Theft-Related Information
(A)Reasonable procedures. A person
that furnishes information to any consumer reporting agency shall have in place
reasonable procedures to respond to any notification that it receives from a
consumer reporting agency under section 605B relating to information resulting
from identity theft, to prevent that person from refurnishing such blocked
information.
(B)Information alleged to result from identity
theft. If a consumer submits an identity theft report to a person
who furnishes information to a consumer reporting agency at the address
specified by that person for receiving such reports stating that information
maintained by such person that purports to relate to the consumer resulted from
identity theft, the person may not furnish such information that purports to
relate to the consumer to any consumer reporting agency, unless the person
subsequently knows or is informed by the consumer that the information is
correct.
(7)Negative
Information
(A)Notice
to Consumer Required
(i)In general. If any financial
institution that extends credit and regularly and in the ordinary course of
business furnishes information to a consumer reporting agency described in
section 603(p) furnishes negative information to such an agency regarding
credit extended to a customer, the financial institution shall provide a notice
of such furnishing of negative information, in writing, to the customer.
(ii)Notice effective for subsequent submissions.
After providing such notice, the financial institution may submit additional
negative information to a consumer reporting agency described in section 603(p)
with respect to the same transaction, extension of credit, account, or customer
without providing additional notice to the customer.
(B)Time
of Notice
(i)In general. The notice required
under subparagraph (A) shall be provided to the customer prior to, or no later
than 30 days after, furnishing the negative information to a consumer reporting
agency described in section 603(p).
(ii)Coordination with new account disclosures.
If the notice is provided to the customer prior to furnishing the negative
information to a consumer reporting agency, the notice may not be included in
the initial disclosures provided under section 127(a) of the Truth in Lending
Act.
(C)Coordination with other disclosures-
The notice required under subparagraph (A)–
(i)may
be included on or with any notice of default, any billing statement, or any
other materials provided to the customer; and
(ii)must
be clear and conspicuous.
(D)Model
Disclosure
(i)Duty of board to prepare. The Board
shall prescribe a brief model disclosure a financial institution may use to
comply with subparagraph (A), which shall not exceed 30 words.
See also 12 CFR Part 222, App B
70 Fed. Reg. 33281 (06/15/04)
(ii)Use of model not required. No provision of this paragraph shall
be construed as requiring a financial institution to use any such model form
prescribed by the Board.
(iii)Compliance using model. A financial
institution shall be deemed to be in compliance with subparagraph (A) if the
financial institution uses any such model form prescribed by the Board, or the
financial institution uses any such model form and rearranges its format.
(E)Use of notice without submitting negative
information. No provision of this paragraph shall be construed as
requiring a financial institution that has provided a customer with a notice
described in subparagraph (A) to furnish negative information about the
customer to a consumer reporting agency.
(F)Safe harbor. A financial
institution shall not be liable for failure to perform the duties required by
this paragraph if, at the time of the failure, the financial institution
maintained reasonable policies and procedures to comply with this paragraph or
the financial institution reasonably believed that the institution is
prohibited, by law, from contacting the consumer.
(G)Definitions. For purposes of this
paragraph, the following definitions shall apply:
(i)The
term “negative information” means information concerning a customer’s
delinquencies, late payments, insolvency, or any form of default.
(ii)The
terms “customer” and “financial institution” have the same
meanings as in section 509 Public Law 106-102.
(8)Ability
of Consumer to Dispute Information Directly with Furnisher
(A)In general. The Federal banking
agencies, the National Credit Union Administration, and the Commission shall
jointly prescribe regulations that shall identify the circumstances under which
a furnisher shall be required to reinvestigate a dispute concerning the
accuracy of information contained in a consumer report on the consumer, based
on a direct request of a consumer.
(B)Considerations. In prescribing
regulations under subparagraph (A), the agencies shall weigh–
(i)the
benefits to consumers with the costs on furnishers and the credit reporting
system;
(ii)the
impact on the overall accuracy and integrity of consumer reports of any such
requirements;
(iii)whether
direct contact by the consumer with the furnisher would likely result in the
most expeditious resolution of any such dispute; and
(iv)the
potential impact on the credit reporting process if credit repair
organizations, as defined in section 403(3) [15 U.S.C. §1679a(3)], including
entities that would be a credit repair organization, but for section
403(3)(B)(i), are able to circumvent the prohibition in subparagraph (G).
(C)Applicability. Subparagraphs (D)
through (G) shall apply in any circumstance identified under the regulations
promulgated under subparagraph (A).
(D)Submitting a notice of dispute- A
consumer who seeks to dispute the accuracy of information shall provide a
dispute notice directly to such person at the address specified by the person
for such notices that–
(i)identifies
the specific information that is being disputed;
(ii)explains
the basis for the dispute; and
(iii)includes
all supporting documentation required by the furnisher to substantiate the
basis of the dispute.
(E)Duty of person after receiving notice of
dispute. After receiving a notice of dispute from a consumer
pursuant to subparagraph (D), the person that provided the information in
dispute to a consumer reporting agency shall-
(i)conduct
an investigation with respect to the disputed information;
(ii)review
all relevant information provided by the consumer with the notice;
(iii)complete
such person’s investigation of the dispute and report the results of the
investigation to the consumer before the expiration of the period under section
611(a)(1) within which a consumer reporting agency would be required to
complete its action if the consumer had elected to dispute the information
under that section; and
(iv)if
the investigation finds that the information reported was inaccurate, promptly
notify each consumer reporting agency to which the person furnished the
inaccurate information of that determination and provide to the agency any
correction to that information that is necessary to make the information
provided by the person accurate.
(F)Frivolous
or Irrelevant Dispute
(i)In general. This paragraph shall
not apply if the person receiving a notice of a dispute from a consumer
reasonably determines that the dispute is frivolous or irrelevant, including–
(I)by
reason of the failure of a consumer to provide sufficient information to
investigate the disputed information; or
(II)the
submission by a consumer of a dispute that is substantially the same as a
dispute previously submitted by or for the consumer, either directly to the
person or through a consumer reporting agency under subsection (b), with
respect to which the person has already performed the person’s duties under
this paragraph or subsection (b), as applicable.
(ii)Notice of determination. Upon
making any determination under clause (i) that a dispute is frivolous or
irrelevant, the person shall notify the consumer of such determination not
later than 5 business days after making such determination, by mail or, if
authorized by the consumer for that purpose, by any other means available to
the person.
(iii)Contents of notice. A notice under
clause (ii) shall include–
(I)the
reasons for the determination under clause (i); and
(II)identification
of any information required to investigate the disputed information, which may
consist of a standardized form describing the general nature of such
information.
(G)Exclusion of credit repair organizations.
This paragraph shall not apply if the notice of the dispute is submitted by, is
prepared on behalf of the consumer by, or is submitted on a form supplied to
the consumer by, a credit repair organization, as defined in section 403(3), or
an entity that would be a credit repair organization, but for section
403(3)(B)(i).
(9)Duty to provide notice of status as medical
information furnisher. A person whose primary business is providing
medical services, products, or devices, or the person’s agent or assignee, who
furnishes information to a consumer reporting agency on a consumer shall be
considered a medical information furnisher for purposes of this title, and
shall notify the agency of such status.
(b)Duties
of Furnishers of Information upon Notice of Dispute
(1)In general. After receiving notice
pursuant to section 611(a)(2) [§ 1681i] of a dispute with regard to the
completeness or accuracy of any information provided by a person to a consumer
reporting agency, the person shall
(A)conduct
an investigation with respect to the disputed information;
(B)review
all relevant information provided by the consumer reporting agency pursuant to
section 611(a)(2) [§ 1681i];
(C)report
the results of the investigation to the consumer reporting agency;
(D)if
the investigation finds that the information is incomplete or inaccurate,
report those results to all other consumer reporting agencies to which the
person furnished the information and that compile and maintain files on consumers
on a nationwide basis; and
(E)if
an item of information disputed by a consumer is found to be inaccurate or
incomplete or cannot be verified after any reinvestigation under paragraph (1),
for purposes of reporting to a consumer reporting agency only, as appropriate,
based on the results of the reinvestigation promptly-
(i)modify
that item of information;
(ii)delete
that item of information; or
(iii)permanently
block the reporting of that item of information.
(2)Deadline. A person shall complete
all investigations, reviews, and reports required under paragraph (1) regarding
information provided by the person to a consumer reporting agency, before the
expiration of the period under section 611(a)(1) [§ 1681i] within which the
consumer reporting agency is required to complete actions required by that
section regarding that information.
(c)Limitation on liability. Except as
provided in section 621(c)(1)(B), sections 616 and 617 do not apply to any
violation of–
(1)subsection
(a) of this section, including any regulations issued thereunder;
(2)subsection
(e) of this section, except that nothing in this paragraph shall limit, expand,
or otherwise affect liability under section 616 or 617, as applicable, for
violations of subsection (b) of this section; or
(3)subsection
(e) of section 615.
(d)Limitation on enforcement. The
provisions of law described in paragraphs (1) through (3) of subsection (c)
(other than with respect to the exception described in paragraph (2) of
subsection (c)) shall be enforced exclusively as provided under section 621 by
the Federal agencies and officials and the State officials identified in
section 621.
(e)Accuracy
Guidelines and Regulations Required
(1)Guidelines. The Federal banking
agencies, the National Credit Union Administration, and the Commission shall,
with respect to the entities that are subject to their respective enforcement
authority under section 621, and in coordination as described in paragraph
(2)–
(A)establish
and maintain guidelines for use by each person that furnishes information to a
consumer reporting agency regarding the accuracy and integrity of the
information relating to consumers that such entities furnish to consumer
reporting agencies, and update such guidelines as often as necessary; and
(B)prescribe
regulations requiring each person that furnishes information to a consumer
reporting agency to establish reasonable policies and procedures for
implementing the guidelines established pursuant to subparagraph (A).
(2)Coordination. Each agency required
to prescribe regulations under paragraph (1) shall consult and coordinate with
each other such agency so that, to the extent possible, the regulations
prescribed by each such entity are consistent and comparable with the
regulations prescribed by each other such agency.
(3)Criteria. In developing the
guidelines required by paragraph (1)(A), the agencies described in paragraph
(1) shall–
(A)identify
patterns, practices, and specific forms of activity that can compromise the
accuracy and integrity of information furnished to consumer reporting agencies;
(B)review
the methods (including technological means) used to furnish information
relating to consumers to consumer reporting agencies;
(C)determine
whether persons that furnish information to consumer reporting agencies
maintain and enforce policies to assure the accuracy and integrity of
information furnished to consumer reporting agencies; and
(D)examine
the policies and processes that persons that furnish information to consumer
reporting agencies employ to conduct reinvestigations and correct inaccurate
information relating to consumers that has been furnished to consumer reporting
agencies.
624.
Affiliate sharing [15 U.S.C. § 1681s-3]
(a)Special
Rule for Solicitation for Purposes of Marketing
(1)Notice. Any person that receives
from another person related to it by common ownership or affiliated by
corporate control a communication of information that would be a consumer
report, but for clauses (i), (ii), and (iii) of section 603(d)(2)(A), may not
use the information to make a solicitation for marketing purposes to a consumer
about its products or services, unless–
(A)it
is clearly and conspicuously disclosed to the consumer that the information may
be communicated among such persons for purposes of making such solicitations to
the consumer; and
(B)the
consumer is provided an opportunity and a simple method to prohibit the making
of such solicitations to the consumer by such person.
(2)Consumer
Choice
(A)In general. The notice required
under paragraph (1) shall allow the consumer the opportunity to prohibit all
solicitations referred to in such paragraph, and may allow the consumer to
choose from different options when electing to prohibit the sending of such
solicitations, including options regarding the types of entities and
information covered, and which methods of delivering solicitations the consumer
elects to prohibit.
(B)Format. Notwithstanding
subparagraph (A), the notice required under paragraph (1) shall be clear,
conspicuous, and concise, and any method provided under paragraph (1)(B) shall
be simple. The regulations prescribed to implement this section shall provide
specific guidance regarding how to comply with such standards.
(3)Duration
(A)In general. The election of a
consumer pursuant to paragraph (1)(B) to prohibit the making of solicitations
shall be effective for at least 5 years, beginning on the date on which the
person receives the election of the consumer, unless the consumer requests that
such election be revoked.
(B)Notice upon expiration of effective period.
At such time as the election of a consumer pursuant to paragraph (1)(B) is no
longer effective, a person may not use information that the person receives in
the manner described in paragraph (1) to make any solicitation for marketing
purposes to the consumer, unless the consumer receives a notice and an
opportunity, using a simple method, to extend the opt-out for another period of
at least 5 years, pursuant to the procedures described in paragraph (1).
(4)Scope. This section shall not apply
to a person-
(A)using
information to make a solicitation for marketing purposes to a consumer with
whom the person has a pre-existing business relationship;
(B)using
information to facilitate communications to an individual for whose benefit the
person provides employee benefit or other services pursuant to a contract with
an employer related to and arising out of the current employment relationship
or status of the individual as a participant or beneficiary of an employee
benefit plan;
(C)using
information to perform services on behalf of another person related by common
ownership or affiliated by corporate control, except that this subparagraph
shall not be construed as permitting a person to send solicitations on behalf
of another person, if such other person would not be permitted to send the
solicitation on its own behalf as a result of the election of the consumer to
prohibit solicitations under paragraph (1)(B);
(D)using
information in response to a communication initiated by the consumer;
(E)using
information in response to solicitations authorized or requested by the
consumer; or
(F)if
compliance with this section by that person would prevent compliance by that
person with any provision of State insurance laws pertaining to unfair
discrimination in any State in which the person is lawfully doing business.
(5)No retroactivity. This subsection
shall not prohibit the use of information to send a solicitation to a consumer
if such information was received prior to the date on which persons are
required to comply with regulations implementing this subsection.
(b)Notice for other purposes permissible.
A notice or other disclosure under this section may be coordinated and
consolidated with any other notice required to be issued under any other
provision of law by a person that is subject to this section, and a notice or
other disclosure that is equivalent to the notice required by subsection (a),
and that is provided by a person described in subsection (a) to a consumer
together with disclosures required by any other provision of law, shall satisfy
the requirements of subsection (a).
(c)User requirements. Requirements
with respect to the use by a person of information received from another person
related to it by common ownership or affiliated by corporate control, such as
the requirements of this section, constitute requirements with respect to the
exchange of information among persons affiliated by common ownership or common
corporate control, within the meaning of section 625(b)(2).
(d)Definitions. For purposes of this
section, the following definitions shall apply:
(1)The
term “pre-existing business relationship” means a relationship
between a person, or a person’s licensed agent, and a consumer, based on–
(A)a
financial contract between a person and a consumer which is in force;
(B)the
purchase, rental, or lease by the consumer of that person’s goods or services,
or a financial transaction (including holding an active account or a policy in
force or having another continuing relationship) between the consumer and that
person during the 18-month period immediately preceding the date on which the
consumer is sent a solicitation covered by this section;
(C)an
inquiry or application by the consumer regarding a product or service offered
by that person, during the 3-month period immediately preceding the date on
which the consumer is sent a solicitation covered by this section; or
(D)any
other pre-existing customer relationship defined in the regulations
implementing this section.
(2)The
term “solicitation” means the marketing of a product or service
initiated by a person to a particular consumer that is based on an exchange of
information described in subsection (a), and is intended to encourage the
consumer to purchase such product or service, but does not include communications
that are directed at the general public or determined not to be a solicitation
by the regulations prescribed under this section.
625.
Relation to State laws [15 U.S.C. § 1681t]
(a)In general. Except as provided in
subsections (b) and (c), this title does not annul, alter, affect, or exempt
any person subject to the provisions of this title from complying with the laws
of any State with respect to the collection, distribution, or use of any
information on consumers, or for the prevention or mitigation of identity
theft, except to the extent that those laws are inconsistent with any provision
of this title, and then only to the extent of the inconsistency.
(b)General exceptions. No requirement
or prohibition may be imposed under the laws of any State
(1)with
respect to any subject matter regulated under
(A)subsection
(c) or (e) of section 604 [§ 1681b], relating to the prescreening of consumer
reports;
(B)section
611 [§ 1681i], relating to the time by which a consumer reporting agency must
take any action, including the provision of notification to a consumer or other
person, in any procedure related to the disputed accuracy of information in a
consumer’s file, except that this subparagraph shall not apply to any State law
in effect on the date of enactment of the Consumer Credit Reporting Reform Act
of 1996;
(C)subsections
(a) and (b) of section 615 [§ 1681m], relating to the duties of a person who
takes any adverse action with respect to a consumer;
(D)section
615(d) [§ 1681m], relating to the duties of persons who use a consumer report
of a consumer in connection with any credit or insurance transaction that is
not initiated by the consumer and that consists of a firm offer of credit or
insurance;
(E)section
605 [§ 1681c], relating to information contained in consumer reports, except
that this subparagraph shall not apply to any State law in effect on the date
of enactment of the Consumer Credit Reporting Reform Act of 1996;
(F)section
623 [§ 1681s-2], relating to the responsibilities of persons who furnish
information to consumer reporting agencies, except that this paragraph shall
not apply
(i)with
respect to section 54A(a) of chapter 93 of the Massachusetts Annotated Laws (as
in effect on the date of enactment of the Consumer Credit Reporting Reform Act
of 1996); or
(ii)with
respect to section 1785.25(a) of the California Civil Code (as in effect on the
date of enactment of the Consumer Credit Reporting Reform Act of 1996);
(G)section
609(e), relating to information available to victims under section 609(e);
(H)section
624, relating to the exchange and use of information to make a solicitation for
marketing purposes; or
(I)section
615(h), relating to the duties of users of consumer reports to provide notice
with respect to terms in certain credit transactions;
(2)with
respect to the exchange of information among persons affiliated by common
ownership or common corporate control, except that this paragraph shall not
apply with respect to subsection (a) or (c)(1) of section 2480e of title 9,
Vermont Statutes Annotated (as in effect on the date of enactment of the
Consumer Credit Reporting Reform Act of 1996);
(3)with
respect to the disclosures required to be made under subsection (c), (d), (e),
or (g) of section 609, or subsection (f) of section 609 relating to the
disclosure of credit scores for credit granting purposes, except that this
paragraph–
(A)shall
not apply with respect to sections 1785.10, 1785.16, and 1785.20.2 of the
California Civil Code (as in effect on the date of enactment of the Fair and
Accurate Credit Transactions Act of 2003) and section 1785.15 through section
1785.15.2 of such Code (as in effect on such date);
(B)shall
not apply with respect to sections 5-3-106(2) and 212-14.3-104.3 of the
Colorado Revised Statutes (as in effect on the date of enactment of the Fair
and Accurate Credit Transactions Act of 2003); and
(C)shall
not be construed as limiting, annulling, affecting, or superseding any
provision of the laws of any State regulating the use in an insurance activity,
or regulating disclosures concerning such use, of a credit-based insurance
score of a consumer by any person engaged in the business of insurance;
(4)with
respect to the frequency of any disclosure under section 612(a), except that
this paragraph shall not apply-
(A)with
respect to section 12-14.3-105(1)(d) of the Colorado Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003);
(B)with
respect to section 10-1-393(29)(C) of the Georgia Code (as in effect on the
date of enactment of the Fair and Accurate Credit Transactions Act of 2003);
(C)with
respect to section 1316.2 of title 10 of the Maine Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003);
(D)with
respect to sections 14-1209(a)(1) and 14-1209(b)(1)(i) of the Commercial Law
Article of the Code of Maryland (as in effect on the date of enactment of the
Fair and Accurate Credit Transactions Act of 2003);
(E)with
respect to section 59(d) and section 59(e) of chapter 93 of the General Laws of
Massachusetts (as in effect on the date of enactment of the Fair and Accurate
Credit Transactions Act of 2003);
(F)with
respect to section 56:11-37.10(a)(1) of the New Jersey Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003); or
(G)with
respect to section 2480c(a)(1) of title 9 of the Vermont Statutes Annotated (as
in effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003); or
(5)with
respect to the conduct required by the specific provisions of–
(A)section
605(g);
(B)section
605A;
(C)section
605B;
(D)section
609(a)(1)(A);
(E)section
612(a);
(F)subsections
(e), (f), and (g) of section 615;
(G)section
621(f);
(H)section
623(a)(6); or
(I)section
628.
(c)Definition of firm offer of credit or insurance.
Notwithstanding any definition of the term “firm offer of credit or
insurance” (or any equivalent term) under the laws of any State, the
definition of that term contained in section 603(l) [§ 1681a] shall be
construed to apply in the enforcement and interpretation of the laws of any
State governing consumer reports.
(d)Limitations. Subsections (b) and
(c) do not affect any settlement, agreement, or consent judgment between any
State Attorney General and any consumer reporting agency in effect on the date
of enactment of the Consumer Credit Reporting Reform Act of 1996.
626.
Disclosures to FBI for counterintelligence purposes [15
U.S.C. § 1681u]
(a)Identity of financial institutions.
Notwithstanding section 604 [§ 1681b] or any other provision of this title, a
consumer reporting agency shall furnish to the Federal Bureau of Investigation
the names and addresses of all financial institutions (as that term is defined
in section 1101 of the Right to Financial Privacy Act of 1978 [12 U.S.C. §
3401]) at which a consumer maintains or has maintained an account, to the
extent that information is in the files of the agency, when presented with a
written request for that information, signed by the Director of the Federal
Bureau of Investigation, or the Director’s designee in a position not lower
than Deputy Assistant Director at Bureau headquarters or a Special Agent in
Charge of a Bureau field office designated by the Director, which certifies
compliance with this section. The Director or the Director’s designee may make
such a certification only if the Director or the Director’s designee has
determined in writing, that such information is sought for the conduct of an
authorized investigation to protect against international terrorism or
clandestine intelligence activities, provided that such an investigation of a
United States person is not conducted solely upon the basis of activities
protected by the first amendment to the Constitution of the United States.
(b)Identifying information.
Notwithstanding the provisions of section 604 [§ 1681b] or any other provision
of this title, a consumer reporting agency shall furnish identifying
information respecting a consumer, limited to name, address, former addresses,
places of employment, or former places of employment, to the Federal Bureau of
Investigation when presented with a written request, signed by the Director or
the Director’s designee, which certifies compliance with this subsection. The
Director or the Director’s designee in a position not lower than Deputy
Assistant Director at Bureau headquarters or a Special Agent in Charge of a
Bureau field office designated by the Director may make such a certification
only if the Director or the Director’s designee has determined in writing that
such information is sought for the conduct of an authorized investigation to
protect against international terrorism or clandestine intelligence activities,
provided that such an investigation of a United States person is not conducted
solely upon the basis of activities protected by the first amendment to the
Constitution of the United States.
(c)Court order for disclosure of consumer reports.
Notwithstanding section 604 [§ 1681b] or any other provision of this title, if
requested in writing by the Director of the Federal Bureau of Investigation, or
a designee of the Director in a position not lower than Deputy Assistant
Director at Bureau headquarters or a Special Agent in Charge of a Bureau field
office designated by the Director, a court may issue an order ex parte
directing a consumer reporting agency to furnish a consumer report to the
Federal Bureau of Investigation, upon a showing in camera that the consumer
report is sought for the conduct of an authorized investigation to protect
against international terrorism or clandestine intelligence activities,
provided that such an investigation of a United States person is not conducted
solely upon the basis of activities protected by the first amendment to the
Constitution of the United States. The terms of an order issued under this
subsection shall not disclose that the order is issued for purposes of a
counterintelligence investigation.
(d)Confidentiality. No consumer
reporting agency or officer, employee, or agent of a consumer reporting agency
shall disclose to any person, other than those officers, employees, or agents
of a consumer reporting agency necessary to fulfill the requirement to disclose
information to the Federal Bureau of Investigation under this section, that the
Federal Bureau of Investigation has sought or obtained the identity of
financial institutions or a consumer report respecting any consumer under
subsection (a), (b), or (c), and no consumer reporting agency or officer,
employee, or agent of a consumer reporting agency shall include in any consumer
report any information that would indicate that the Federal Bureau of
Investigation has sought or obtained such information or a consumer report.
(e)Payment of fees. The Federal Bureau
of Investigation shall, subject to the availability of appropriations, pay to
the consumer reporting agency assembling or providing report or information in
accordance with procedures established under this section a fee for
reimbursement for such costs as are reasonably necessary and which have been
directly incurred in searching, reproducing, or transporting books, papers,
records, or other data required or requested to be produced under this section.
(f)Limit on dissemination. The Federal
Bureau of Investigation may not disseminate information obtained pursuant to
this section outside of the Federal Bureau of Investigation, except to other
Federal agencies as may be necessary for the approval or conduct of a foreign
counterintelligence investigation, or, where the information concerns a person
subject to the Uniform Code of Military Justice, to appropriate investigative
authorities within the military department concerned as may be necessary for
the conduct of a joint foreign counterintelligence investigation.
(g)Rules of construction. Nothing in
this section shall be construed to prohibit information from being furnished by
the Federal Bureau of Investigation pursuant to a subpoena or court order, in
connection with a judicial or administrative proceeding to enforce the
provisions of this Act. Nothing in this section shall be construed to authorize
or permit the withholding of information from the Congress.
(h)Reports to Congress. On a
semiannual basis, the Attorney General shall fully inform the Permanent Select
Committee on Intelligence and the Committee on Banking, Finance and Urban
Affairs of the House of Representatives, and the Select Committee on
Intelligence and the Committee on Banking, Housing, and Urban Affairs of the
Senate concerning all requests made pursuant to subsections (a), (b), and (c).
(i)Damages. Any agency or department
of the United States obtaining or disclosing any consumer reports, records, or
information contained therein in violation of this section is liable to the
consumer to whom such consumer reports, records, or information relate in an
amount equal to the sum of
(1)$100,
without regard to the volume of consumer reports, records, or information
involved;
(2)any
actual damages sustained by the consumer as a result of the disclosure;
(3)if
the violation is found to have been willful or intentional, such punitive
damages as a court may allow; and
(4)in
the case of any successful action to enforce liability under this subsection,
the costs of the action, together with reasonable attorney fees, as determined
by the court.
(j)Disciplinary actions for violations.
If a court determines that any agency or department of the United States has
violated any provision of this section and the court finds that the
circumstances surrounding the violation raise questions of whether or not an
officer or employee of the agency or department acted willfully or
intentionally with respect to the violation, the agency or department shall
promptly initiate a proceeding to determine whether or not disciplinary action
is warranted against the officer or employee who was responsible for the
violation.
(k)Good-faith exception.
Notwithstanding any other provision of this title, any consumer reporting
agency or agent or employee thereof making disclosure of consumer reports or
identifying information pursuant to this subsection in good-faith reliance upon
a certification of the Federal Bureau of Investigation pursuant to provisions
of this section shall not be liable to any person for such disclosure under
this title, the constitution of any State, or any law or regulation of any
State or any political subdivision of any State.
(l)Limitation of remedies.
Notwithstanding any other provision of this title, the remedies and sanctions
set forth in this section shall be the only judicial remedies and sanctions for
violation of this section.
(m)Injunctive relief. In addition to
any other remedy contained in this section, injunctive relief shall be
available to require compliance with the procedures of this section. In the event
of any successful action under this subsection, costs together with reasonable
attorney fees, as determined by the court, may be recovered.
627.
Disclosures to governmental agencies for counterterrorism purposes [15
U.S.C. §1681v]
(a)Disclosure. Notwithstanding section
604 or any other provision of this title, a consumer reporting agency shall
furnish a consumer report of a consumer and all other information in a
consumer’s file to a government agency authorized to conduct investigations of,
or intelligence or counterintelligence activities or analysis related to,
international terrorism when presented with a written certification by such
government agency that such information is necessary for the agency’s conduct
or such investigation, activity or analysis.
(b)Form of certification. The
certification described in subsection (a) shall be signed by a supervisory
official designated by the head of a Federal agency or an officer of a Federal
agency whose appointment to office is required to be made by the President, by
and with the advice and consent of the Senate.
(c)Confidentiality. No consumer
reporting agency, or officer, employee, or agent of such consumer reporting
agency, shall disclose to any person, or specify in any consumer report, that a
government agency has sought or obtained access to information under subsection
(a).
(d)Rule of construction. Nothing in
section 626 shall be construed to limit the authority of the Director of the
Federal Bureau of Investigation under this section.
(e)Safe harbor. Notwithstanding any
other provision of this title, any consumer reporting agency or agent or
employee thereof making disclosure of consumer reports or other information
pursuant to this section in good-faith reliance upon a certification of a
governmental agency pursuant to the provisions of this section shall not be
liable to any person for such disclosure under this subchapter, the
constitution of any State, or any law or regulation of any State or any
political subdivision of any State.
628.
Disposal of records [15 U.S.C. §1681w]
See also 16 CFR Part 682
(a)Regulations
69 Fed. Reg. 68690 (11/24/04)
(1)In general. Not later than 1 year
after the date of enactment of this section, the Federal banking agencies, the
National Credit Union Administration, and the Commission with respect to the
entities that are subject to their respective enforcement authority under
section 621, and the Securities and Exchange Commission, and in coordination as
described in paragraph (2), shall issue final regulations requiring any person
that maintains or otherwise possesses consumer information, or any compilation
of consumer information, derived from consumer reports for a business purpose
to properly dispose of any such information or compilation.
(2)Coordination. Each agency required
to prescribe regulations under paragraph (1) shall-
(A)consult
and coordinate with each other such agency so that, to the extent possible, the
regulations prescribed by each such agency are consistent and comparable with
the regulations by each such other agency; and
(B)ensure
that such regulations are consistent with the requirements and regulations
issued pursuant to Public Law 106-102 and other provisions of Federal law.
(3)Exemption authority. In issuing
regulations under this section, the Federal banking agencies, the National
Credit Union Administration, the Commission, and the Securities and Exchange
Commission may exempt any person or class of persons from application of those
regulations, as such agency deems appropriate to carry out the purpose of this
section.
(b)Rule of construction. Nothing in
this section shall be construed–
(1)to
require a person to maintain or destroy any record pertaining to a consumer
that is not imposed under other law; or
(2)to
alter or affect any requirement imposed under any other provision of law to
maintain or destroy such a record.
629.
Corporate and technological circumvention prohibited [15
U.S.C. §1681x]
The
Commission shall prescribe regulations, to become effective not later than 90
days after the date of enactment of this section, to prevent a consumer
reporting agency from circumventing or evading treatment as a consumer
reporting agency described in section 603(p) for purposes of this title,
including–
(1)by
means of a corporate reorganization or restructuring, including a merger,
acquisition, dissolution, divestiture, or asset sale of a consumer reporting
agency; or
(2)by
maintaining or merging public record and credit account information in a manner
that is substantially equivalent to that described in paragraphs (1) and (2) of
section 603(p), in the manner described in section 603(p).
See also 16 CFR Part 611
69 Fed. Reg. 8531 (02/24/04)
69 Fed. Reg. 29061 (05/20/04)
Legislative
History
House
Reports:No. 91-975 (Comm. on Banking and Currency) and
No.
91-1587 (Comm. of Conference)
Senate
Reports:No. 91-1139 accompanying S. 3678 (Comm. on Banking and Currency)
Congressional Record, Vol. 116 (1970)
May
25, considered and passed House.
Sept.
18, considered and passed Senate, amended.
Oct.
9, Senate agreed to conference report.
Oct.
13, House agreed to conference report.
Enactment:Public
Law No. 91-508 (October 26, 1970):
Amendments:95-473
(October 17, 1978)Public Law Nos.
95-598
(November 6, 1978)

98-443
(October 4, 1984)

101-73
(August 9, 1989)

102-242
(December 19, 1991)

102-537
(October 27, 1992)

102-550
(October 28, 1992)

103-325
(September 23, 1994)

104-88
(December 29, 1995)

104-93
(January 6, 1996)

104-193
(August 22, 1996)

104-208
(September 30, 1996)

105-107
(November 20, 1997)

105-347
(November 2, 1998)

106-102
(November 12, 1999)

107-56
(October 26, 2001)

108-159
(December 4, 2003)

109-351
(October 13, 2006)
1 The references in
Sections 604(b)(3)(A) and 604(b)(3)(B) should be to Section 609(c)(1), not (c)(3)
that no longer exists as the result of Congress’ re-organization of Section
609(c) in 2003 (FACT Act).
2 The reporting
periods have been lengthened for certain adverse information pertaining to U.S.
Government insured or guaranteed student loans, or pertaining to national
direct student loans. See sections 430A(f) and 463(c)(3) of the Higher
Education Act of 1965, 20 U.S.C. 1080a(f) and 20 U.S.C. 1087cc(c)(3),
respectively.
3 This provision,
added in September 1996, should read “paragraphs (4) and (5)….”
Prior Section 605(a)(6) was amended and re-designated as Section 605(a)(5) in
November 1998. The current Section 605(a)(6), added in December 2003 and now
containing no reference to any 7-year period, is obviously inapplicable.
4 Pursuant to Section
612(f)(2), the Federal Trade Commission increased the maximum allowable charge
to $10, effective January 1, 2006. See 70 Fed. Reg. 74816 (Dec. 16, 2005).

Fair and Accurate Credit
Transactions Act
An Act to amend the
Fair Credit Reporting Act, to prevent identity theft, improve resolution of
consumer disputes, improve the accuracy of consumer records, make improvements
in the use of, and consumer access to, credit information, and for other
purposes.

Section
1. Short Title; Table of Contents
(a)Short
Title. – This Act may be cited as the “Fair and Accurate Credit
Transactions Act of 2003”.
(b)Table
of Contents, – The table of contents for this Act is as follows:
Sec. 1.Short title;
table of contents.Sec. 2.Definitions.Sec. 3.Effective dates.
TITLE I – IDENTITY THEFT PREVENTION AND CREDIT HISTORY
RESTORATION
Subtitle A – Identity Theft Prevention
Sec. 111.Amendment to
definitions.Sec. 112.Fraud alerts
and active duty alerts.Sec. 113.Truncation of
credit card and debit card account numbers.Sec. 114.Establishment
of procedures for the identification of possible instances of identity theft.Sec. 115.Authority to
truncate social security numbers.
Subtitle B – Protection and Restoration of Identity Theft Victim
Credit History
Sec. 151.Summary of
rights of identity theft victims.Sec. 152.Blocking of
information resulting from identity theft.Sec. 153.Coordination of
identity theft complaint investigations.Sec. 154.Prevention of
repollution of consumer reports.
Sec. 155.Notice by debt
collectors with respect to fraudulent information.Sec. 156.Statute of
limitations.Sec. 157.Study on the
use of technology to combat identity theft.
TITLE II – IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT
INFORMATION
Sec. 211.Free consumer
reports.Sec. 212.Disclosure of
credit scores.Sec. 213.Enhanced
disclosure of the means available to opt out of prescreened lists.Sec. 214.Affiliate
sharing.Sec. 215.Study of effects
of credit scores and credit-based insurance scores on availability and
affordability of financial products.Sec. 216.Disposal of
consumer report information and records.Sec. 217.Requirement to
disclose communications to a consumer reporting agency.
TITLE III – ENHANCING THE ACCURACY OF CONSUMER REPORT
INFORMATION
Sec. 311.Risk-based
pricing notice.Sec. 312.Procedures to
enhance the accuracy and integrity of information furnished to consumer
reporting agencies.Sec. 313.FTC and
consumer reporting agency action concerning complaints.Sec. 314.Improved
disclosure of the results of reinvestigation.Sec. 315.Reconciling
addresses.Sec. 316.Notice of
dispute through reseller.Sec. 317.Reasonable
reinvestigation required.Sec. 318.FTC study of
issues relating to the Fair Credit Reporting Act.Sec. 319.FTC study of
the accuracy of consumer reports.
TITLE IV – LIMITING THE USE AND SHARING OF MEDICAL INFORMATION
IN THE FINANCIAL SYSTEM
Sec. 411.Protection of
medical information in the financial system.Sec. 412.Confidentiality
of medical contact information in consumer reports.
TITLE V – FINANCIAL LITERACY AND EDUCATION IMPROVEMENT
Sec. 511.Short title.Sec. 512.Definitions.Sec. 513.Establishment
of Financial Literacy and Education Commission.Sec. 514.Duties of the
Commission.Sec. 515.Powers of the
Commission.Sec. 516.Commission
personnel matters.Sec. 517.Studies by the
Comptroller General.Sec. 518.The national
public service multimedia campaign to enhance the state of financial literacy.Sec. 519.Authorization
of appropriations.
TITLE VI – PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS
Sec. 611.Certain
employee investigation communications excluded from definition of consumer
report.
TITLE VII – RELATION TO STATE LAWS
Sec. 711.Relation to
State laws.
TITLE VIII – MISCELLANEOUS
Sec. 811.Clerical
amendments.
SEC.
2. DEFINITIONS.
As
used in this Act –
(1)the
term “Board” means the Board of Governors of the Federal Reserve
System;
(2)the
term “Commission”, other than as used in title V, means the Federal
Trade Commission;
(3)the
terms “consumer”, “consumer report”, “consumer
reporting agency”, “creditor”, “Federal banking
agencies”, and “financial institution” have the same meanings as
in section 603 of the Fair Credit Reporting Act, as amended by this Act; and
(4)the
term “affiliates” means persons that are related by common ownership
or affiliated by corporate control.
SEC.
3. EFFECTIVE DATES.
Except
as otherwise specifically provided in this Act and the amendments made by this
Act –
(1)before
the end of the 2-month period beginning on the date of enactment of this Act,
the Board and the Commission shall jointly prescribe regulations in final form
establishing effective dates for each provision of this Act; and
(2)the
regulations prescribed under paragraph (1) shall establish effective dates that
are as early as possible, while allowing a reasonable time for the
implementation of the provisions of this Act, but in no case shall any such
effective date be later than 10 months after the date of issuance of such
regulations in final form.
TITLE
I – IDENTITY THEFT PREVENTION AND CREDIT HISTORY RESTORATION
Subtitle
A – Identity Theft Prevention
SEC.
111. AMENDMENT TO DEFINITIONS.
Section
603 of the Fair Credit Reporting Act (15 U.S.C. 1681a) is amended by adding at
the end the following:
“(q)DEFINITIONS
RELATING TO FRAUD ALERTS. –
“(1)ACTIVE
DUTY MILITARY CONSUMER. – The term ‘active duty military consumer’ means a
consumer in military service who –
“(A)is
on active duty (as defined in section 101(d)(1) of title 10, United States
Code) or is a reservist performing duty under a call or order to active duty
under a provision of law referred to in section 101(a)(13) of title 10, United
States Code; and
“(B)is
assigned to service away from the usual duty station of the consumer.
“(2)FRAUD
ALERT; ACTIVE DUTY ALERT. – The terms ‘fraud alert’ and ‘active duty alert’
mean a statement in the file of a consumer that –
“(A)notifies
all prospective users of a consumer report relating to the consumer that the
consumer may be a victim of fraud, including identity theft, or is an active
duty military consumer, as applicable; and
“(B)is
presented in a manner that facilitates a clear and conspicuous view of the
statement described in subparagraph (A) by any person requesting such consumer
report.
“(3)IDENTITY
THEFT. – The term ‘identity theft’ means a fraud committed using the
identifying information of another person, subject to such further definition
as the Commission may prescribe, by regulation.
“(4)IDENTITY
THEFT REPORT. – The term ‘identity theft report’ has the meaning given that
term by rule of the Commission, and means, at a minimum, a report –
“(A)that
alleges an identity theft;
“(B)that
is a copy of an official, valid report filed by a consumer with an appropriate
Federal, State, or local law enforcement agency, including the United States
Postal Inspection Service, or such other government agency deemed appropriate
by the Commission; and
“(C)the
filing of which subjects the person filing the report to criminal penalties relating
to the filing of false information if, in fact, the information in the report
is false.
“(5)NEW
CREDIT PLAN. – The term ‘new credit plan’ means a new account under an open end
credit plan (as defined in section 103(i) of the Truth in Lending Act) or a new
credit transaction not under an open end credit plan.
“(r)CREDIT
AND DEBIT RELATED TERMS –
“(1)CARD
ISSUER. – The term ‘card issuer’ means –
“(A)a
credit card issuer, in the case of a credit card; and
“(B)a
debit card issuer, in the case of a debit card.
“(2)CREDIT
CARD. – The term ‘credit card’ has the same meaning as in section 103 of the
Truth in Lending Act.
“(3)DEBIT
CARD. – The term ‘debit card’ means any card issued by a financial institution
to a consumer for use in initiating an electronic fund transfer from the
account of the consumer at such financial institution, for the purpose of
transferring money between accounts or obtaining money, property, labor, or
services.
“(4)ACCOUNT
AND ELECTRONIC FUND TRANSFER. – The terms ‘account’ and ‘electronic fund
transfer’ have the same meanings as in section 903 of the Electronic Fund
Transfer Act.
“(5)CREDIT
AND CREDITOR. – The terms ‘credit’ and ‘creditor’ have the same meanings as in
section 702 of the Equal Credit Opportunity Act.
“(s)FEDERAL
BANKING AGENCY. – The term ‘Federal banking agency’ has the same meaning as in
section 3 of the Federal Deposit Insurance Act.
“(t)FINANCIAL
INSTITUTION. – The term ‘financial institution’ means a State or National bank,
a State or Federal savings and loan association, a mutual savings bank, a State
or Federal credit union, or any other person that, directly or indirectly,
holds a transaction account (as defined in section 19(b) of the Federal Reserve
Act) belonging to a consumer.
“(u)RESELLER.
– The term ‘reseller’ means a consumer reporting agency that –
“(1)assembles
and merges information contained in the database of another consumer reporting
agency or multiple consumer reporting agencies concerning any consumer for
purposes of furnishing such information to any third party, to the extent of
such activities; and
“(2)does
not maintain a database of the assembled or merged information from which new
consumer reports are produced.
“(v)COMMISSION.
– The term ‘Commission’ means the Federal Trade Commission.
“(w)NATIONWIDE
SPECIALTY CONSUMER REPORTING AGENCY. – The term ‘nationwide specialty consumer
reporting agency’ means a consumer reporting agency that compiles and maintains
files on consumers on a nationwide basis relating to –
“(1)medical
records or payments;
“(2)residential
or tenant history;
“(3)check
writing history;
“(4)employment
history; or
“(5)insurance
claims.”.
SEC.
112. FRAUD ALERTS AND ACTIVE DUTY ALERTS.
(a)FRAUD
ALERTS. – The Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) is amended by
inserting after section 605 the following:
Ҥ 605A. Identity
theft prevention; fraud alerts and active duty alerts
“(a)ONE-CALL
FRAUD ALERTS. –
“(1)INITIAL
ALERTS. – Upon the direct request of a consumer, or an individual acting on
behalf of or as a personal representative of a consumer, who asserts in good
faith a suspicion that the consumer has been or is about to become a victim of
fraud or related crime, including identity theft, a consumer reporting agency
described in section 603(p) that maintains a file on the consumer and has
received appropriate proof of the identity of the requester shall –
“(A)include
a fraud alert in the file of that consumer, and also provide that alert along
with any credit score generated in using that file, for a period of not less than
90 days, beginning on the date of such request, unless the consumer or such
representative requests that such fraud alert be removed before the end of such
period, and the agency has received appropriate proof of the identity of the
requester for such purpose; and
“(B)refer
the information regarding the fraud alert under this paragraph to each of the
other consumer reporting agencies described in section 603(p), in accordance
with procedures developed under section 621(f).
“(2)ACCESS
TO FREE REPORTS. – In any case in which a consumer reporting agency includes a
fraud alert in the file of a consumer pursuant to this subsection, the consumer
reporting agency shall –
“(A)disclose
to the consumer that the consumer may request a free copy of the file of the consumer
pursuant to section 612(d); and
“(B)provide
to the consumer all disclosures required to be made under section 609, without
charge to the consumer, not later than 3 business days after any request
described in subparagraph (A).
“(b)EXTENDED
ALERTS. –
“(1)IN
GENERAL. – Upon the direct request of a consumer, or an individual acting on
behalf of or as a personal representative of a consumer, who submits an
identity theft report to a consumer reporting agency described in section
603(p) that maintains a file on the consumer, if the agency has received
appropriate proof of the identity of the requester, the agency shall –
“(A)include
a fraud alert in the file of that consumer, and also provide that alert along
with any credit score generated in using that file, during the 7-year period
beginning on the date of such request, unless the consumer or such
representative requests that such fraud alert be removed before the end of such
period and the agency has received appropriate proof of the identity of the requester
for such purpose;
“(B)during
the 5-year period beginning on the date of such request, exclude the consumer
from any list of consumers prepared by the consumer reporting agency and
provided to any third party to offer credit or insurance to the consumer as
part of a transaction that was not initiated by the consumer, unless the
consumer or such representative requests that such exclusion be rescinded
before the end of such period; and
“(C)refer
the information regarding the extended fraud alert under this paragraph to each
of the other consumer reporting agencies described in section 603(p), in
accordance with procedures developed under section 621(f).
“(2)ACCESS
TO FREE REPORTS. – In any case in which a consumer reporting agency includes a
fraud alert in the file of a consumer pursuant to this subsection, the consumer
reporting agency shall –
“(A)disclose
to the consumer that the consumer may request 2 free copies of the file of the
consumer pursuant to section 612(d) during the 12-month period beginning on the
date on which the fraud alert was included in the file; and
“(B)provide
to the consumer all disclosures required to be made under section 609, without
charge to the consumer, not later than 3 business days after any request
described in subparagraph (A).
“(c)ACTIVE
DUTY ALERTS. – Upon the direct request of an active duty military consumer, or
an individual acting on behalf of or as a personal representative of an active
duty military consumer, a consumer reporting agency described in section 603(p)
that maintains a file on the active duty military consumer and has received
appropriate proof of the identity of the requester shall –
“(1)include
an active duty alert in the file of that active duty military consumer, and
also provide that alert along with any credit score generated in using that
file, during a period of not less than 12 months, or such longer period as the
Commission shall determine, by regulation, beginning on the date of the
request, unless the active duty military consumer or such representative
requests that such fraud alert be removed before the end of such period, and
the agency has received appropriate proof of the identity of the requester for
such purpose;
“(2)during
the 2-year period beginning on the date of such request, exclude the active
duty military consumer from any list of consumers prepared by the consumer
reporting agency and provided to any third party to offer credit or insurance
to the consumer as part of a transaction that was not initiated by the
consumer, unless the consumer requests that such exclusion be rescinded before
the end of such period; and
“(3)refer
the information regarding the active duty alert to each of the other consumer
reporting agencies described in section 603(p), in accordance with procedures developed
under section 621(f).
“(d)PROCEDURES.
– Each consumer reporting agency described in section 603(p) shall establish
policies and procedures to comply with this section, including procedures that
inform consumers of the availability of initial, extended, and active duty
alerts and procedures that allow consumers and active duty military consumers
to request initial, extended, or active duty alerts (as applicable) in a simple
and easy manner, including by telephone.
“(e)REFERRALS
OF ALERTS. – Each consumer reporting agency described in section 603(p) that
receives a referral of a fraud alert or active duty alert from another consumer
reporting agency pursuant to this section shall, as though the agency received
the request from the consumer directly, follow the procedures required under –
“(1)paragraphs
(1)(A) and (2) of subsection (a), in the case of a referral under subsection
(a)(1)(B);
“(2)paragraphs
(1)(A), (1)(B), and (2) of subsection (b), in the case of a referral under
subsection (b)(1)(C); and
“(3)paragraphs
(1) and (2) of subsection (c), in the case of a referral under subsection
(c)(3).
“(f)DUTY
OF RESELLER TO RECONVEY ALERT. – A reseller shall include in its report any
fraud alert or active duty alert placed in the file of a consumer pursuant to
this section by another consumer reporting agency.
“(g)DUTY
OF OTHER CONSUMER REPORTING AGENCIES TO PROVIDE CONTACT INFORMATION. – If a
consumer contacts any consumer reporting agency that is not described in
section 603(p) to communicate a suspicion that the consumer has been or is
about to become a victim of fraud or related crime, including identity theft,
the agency shall provide information to the consumer on how to contact the
Commission and the consumer reporting agencies described in section 603(p) to
obtain more detailed information and request alerts under this section.
“(h)LIMITATIONS
ON USE OF INFORMATION FOR CREDIT EXTENSIONS. –
“(1)REQUIREMENTS
FOR INITIAL AND ACTIVE DUTY ALERTS. –
“(A)NOTIFICATION.
– Each initial fraud alert and active duty alert under this section shall
include information that notifies all prospective users of a consumer report on
the consumer to which the alert relates that the consumer does not authorize
the establishment of any new credit plan or extension of credit, other than
under an open end credit plan (as defined in section 103(i)), in the name of
the consumer, or issuance of an additional card on an existing credit account
requested by a consumer, or any increase in credit limit on an existing credit
account requested by a consumer, except in accordance with subparagraph (B).
“(B)LIMITATION
ON USERS. –
“(i)IN
GENERAL. – No prospective user of a consumer report that includes an initial
fraud alert or an active duty alert in accordance with this section may establish
a new credit plan or extension of credit, other than under an open-end credit
plan (as defined in section 103(i)), in the name of the consumer, or issue an
additional card on an existing credit account requested by a consumer, or grant
any increase in credit limit on an existing credit account requested by a
consumer, unless the user utilizes reasonable policies and procedures to form a
reasonable belief that the user knows the identity of the person making the
request.
“(ii)VERIFICATION.
– If a consumer requesting the alert has specified a telephone number to be
used for identity verification purposes, before authorizing any new credit plan
or extension described in clause (i) in the name of such consumer, a user of
such consumer report shall contact the consumer using that telephone number or
take reasonable steps to verify the consumer’s identity and confirm that the
application for a new credit plan is not the result of identity theft.
“(2)REQUIREMENTS
FOR EXTENDED ALERTS. –
“(A)NOTIFICATION.
– Each extended alert under this section shall include information that
provides all prospective users of a consumer report relating to a consumer with

“(i)notification
that the consumer does not authorize the establishment of any new credit plan
or extension of credit described in clause (i), other than under an open-end
credit plan (as defined in section 103(i)), in the name of the consumer, or
issuance of an additional card on an existing credit account requested by a
consumer, or any increase in credit limit on an existing credit account
requested by a consumer, except in accordance with subparagraph (B); and
“(ii)a
telephone number or other reasonable contact method designated by the consumer.
“(B)LIMITATION
ON USERS. – No prospective user of a consumer report or of a credit score
generated using the information in the file of a consumer that includes an
extended fraud alert in accordance with this section may establish a new credit
plan or extension of credit, other than under an open-end credit plan (as defined
in section 103(i)), in the name of the consumer, or issue an additional card on
an existing credit account requested by a consumer, or any increase in credit
limit on an existing credit account requested by a consumer, unless the user
contacts the consumer in person or using the contact method described in
subparagraph (A)(ii) to confirm that the application for a new credit plan or
increase in credit limit, or request for an additional card is not the result
of identity theft.”.
(b)RULEMAKING.
– The Commission shall prescribe regulations to define what constitutes
appropriate proof of identity for purposes of sections 605A, 605B, and
609(a)(1) of the Fair Credit Reporting Act, as amended by this Act.
SEC.
113. TRUNCATION OF CREDIT CARD AND DEBIT CARD ACCOUNT NUMBERS.
Section
605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by adding at
the end the following:
“(g)TRUNCATION
OF CREDIT CARD AND DEBIT CARD NUMBERS. –
“(1)IN
GENERAL. – Except as otherwise provided in this subsection, no person that
accepts credit cards or debit cards for the transaction of business shall print
more than the last 5 digits of the card number or the expiration date upon any
receipt provided to the cardholder at the point of the sale or transaction.
“(2)LIMITATION.
– This subsection shall apply only to receipts that are electronically printed,
and shall not apply to transactions in which the sole means of recording a
credit card or debit card account number is by handwriting or by an imprint or
copy of the card.
“(3)EFFECTIVE
DATE. – This subsection shall become effective –
“(A)3
years after the date of enactment of this subsection, with respect to any cash
register or other machine or device that electronically prints receipts for
credit card or debit card transactions that is in use before January 1, 2005;
and
“(B)1
year after the date of enactment of this subsection, with respect to any cash
register or other machine or device that electronically prints receipts for
credit card or debit card transactions that is first put into use on or after
January 1, 2005.”.
SEC.
114. ESTABLISHMENT OF PROCEDURES FOR THE IDENTIFICATION OF POSSIBLE INSTANCES
OF IDENTITY THEFT.
Section
615 of the Fair Credit Reporting Act (15 U.S.C. 1681m) is amended –
(1)by
striking “(e)” at the end; and
(2)by
adding at the end the following:
“(e)RED
FLAG GUIDELINES AND REGULATIONS REQUIRED. –
“(1)GUIDELINES.
– The Federal banking agencies, the National Credit Union Administration, and
the Commission shall jointly, with respect to the entities that are subject to
their respective enforcement authority under section 621 –
“(A)establish
and maintain guidelines for use by each financial institution and each creditor
regarding identity theft with respect to account holders at, or customers of,
such entities, and update such guidelines as often as necessary;
“(B)prescribe
regulations requiring each financial institution and each creditor to establish
reasonable policies and procedures for implementing the guidelines established
pursuant to subparagraph (A), to identify possible risks to account holders or
customers or to the safety and soundness of the institution or customers; and
“(C)prescribe
regulations applicable to card issuers to ensure that, if a card issuer
receives notification of a change of address for an existing account, and
within a short period of time (during at least the first 30 days after such
notification is received) receives a request for an additional or replacement
card for the same account, the card issuer may not issue the additional or
replacement card, unless the card issuer, in accordance with reasonable
policies and procedures –
“(i)notifies
the cardholder of the request at the former address of the cardholder and
provides to the cardholder a means of promptly reporting incorrect address
changes;
“(ii)notifies
the cardholder of the request by such other means of communication as the
cardholder and the card issuer previously agreed to; or
“(iii)uses
other means of assessing the validity of the change of address, in accordance
with reasonable policies and procedures established by the card issuer in
accordance with the regulations prescribed under subparagraph (B).
“(2)CRITERIA.

“(A)IN
GENERAL. – In developing the guidelines required by paragraph (1)(A), the
agencies described in paragraph (1) shall identify patterns, practices, and
specific forms of activity that indicate the possible existence of identity
theft.
“(B)INACTIVE
ACCOUNTS. – In developing the guidelines required by paragraph (1)(A), the
agencies described in paragraph (1) shall consider including reasonable
guidelines providing that when a transaction occurs with respect to a credit or
deposit account that has been inactive for more than 2 years, the creditor or
financial institution shall follow reasonable policies and procedures that
provide for notice to be given to a consumer in a manner reasonably designed to
reduce the likelihood of identity theft with respect to such account.
“(3)CONSISTENCY
WITH VERIFICATION REQUIREMENTS. – Guidelines established pursuant to paragraph
(1) shall not be inconsistent with the policies and procedures required under
section 5318(l) of title 31, United States Code.”.
SEC.
115. AUTHORITY TO TRUNCATE SOCIAL SECURITY NUMBERS.
Section
609(a)(1) of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)(1)) is amended
by striking “except that nothing” and inserting the following:
“except that –
“(A)if
the consumer to whom the file relates requests that the first 5 digits of the
social security number (or similar identification number) of the consumer not
be included in the disclosure and the consumer reporting agency has received
appropriate proof of the identity of the requester, the consumer reporting
agency shall so truncate such number in such disclosure; and
“(B)nothing”.
Subtitle
B – Protection and Restoration of Identity Theft Victim Credit History
SEC.
151. SUMMARY OF RIGHTS OF IDENTITY THEFT VICTIMS.
(a)IN
GENERAL. –
(1)SUMMARY.
– Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681g) is amended by
adding at the end the following:
“(d)SUMMARY
OF RIGHTS OF IDENTITY THEFT VICTIMS. –
“(1)IN
GENERAL. – The Commission, in consultation with the Federal banking agencies
and the National Credit Union Administration, shall prepare a model summary of
the rights of consumers under this title with respect to the procedures for
remedying the effects of fraud or identity theft involving credit, an
electronic fund transfer, or an account or transaction at or with a financial
institution or other creditor.
“(2)SUMMARY
OF RIGHTS AND CONTACT INFORMATION. – Beginning 60 days after the date on which
the model summary of rights is prescribed in final form by the Commission
pursuant to paragraph (1), if any consumer contacts a consumer reporting agency
and expresses a belief that the consumer is a victim of fraud or identity theft
involving credit, an electronic fund transfer, or an account or transaction at
or with a financial institution or other creditor, the consumer reporting
agency shall, in addition to any other action that the agency may take, provide
the consumer with a summary of rights that contains all of the information
required by the Commission under paragraph (1), and information on how to
contact the Commission to obtain more detailed information.
“(e)INFORMATION
AVAILABLE TO VICTIMS. –
“(1)IN
GENERAL. – For the purpose of documenting fraudulent transactions resulting
from identity theft, not later than 30 days after the date of receipt of a
request from a victim in accordance with paragraph (3), and subject to
verification of the identity of the victim and the claim of identity theft in
accordance with paragraph (2), a business entity that has provided credit to,
provided for consideration products, goods, or services to, accepted payment
from, or otherwise entered into a commercial transaction for consideration
with, a person who has allegedly made unauthorized use of the means of
identification of the victim, shall provide a copy of application and business
transaction records in the control of the business entity, whether maintained
by the business entity or by another person on behalf of the business entity,
evidencing any transaction alleged to be a result of identity theft to –
“(A)the
victim;
“(B)any
Federal, State, or local government law enforcement agency or officer specified
by the victim in such a request; or
“(C)any
law enforcement agency investigating the identity theft and authorized by the
victim to take receipt of records provided under this subsection.
“(2)VERIFICATION
OF IDENTITY AND CLAIM. – Before a business entity provides any information
under paragraph (1), unless the business entity, at its discretion, otherwise
has a high degree of confidence that it knows the identity of the victim making
a request under paragraph (1), the victim shall provide to the business entity

“(A)as
proof of positive identification of the victim, at the election of the business
entity –
“(i)the
presentation of a government-issued identification card;
“(ii)personally
identifying information of the same type as was provided to the business entity
by the unauthorized person; or
“(iii)personally
identifying information that the business entity typically requests from new
applicants or for new transactions, at the time of the victim’s request for
information, including any documentation described in clauses (i) and (ii); and
“(B)as
proof of a claim of identity theft, at the election of the business entity –
“(i)a
copy of a police report evidencing the claim of the victim of identity theft;
and
“(ii)a
properly completed –
“(I)copy
of a standardized affidavit of identity theft developed and made available by
the Commission; or
“(II)an
affidavit of fact that is acceptable to the business entity for that purpose.
“(3)PROCEDURES.
– The request of a victim under paragraph (1) shall –
“(A)be
in writing;
“(B)be
mailed to an address specified by the business entity, if any; and
“(C)if
asked by the business entity, include relevant information about any
transaction alleged to be a result of identity theft to facilitate compliance
with this section including –
“(i)if
known by the victim (or if readily obtainable by the victim), the date of the
application or transaction; and
“(ii)if
known by the victim (or if readily obtainable by the victim), any other
identifying information such as an account or transaction number.
“(4)NO
CHARGE TO VICTIM. – Information required to be provided under paragraph (1)
shall be so provided without charge.
“(5)AUTHORITY
TO DECLINE TO PROVIDE INFORMATION. – A business entity may decline to provide
information under paragraph (1) if, in the exercise of good faith, the business
entity determines that –
“(A)this
subsection does not require disclosure of the information;
“(B)after
reviewing the information provided pursuant to paragraph (2), the business
entity does not have a high degree of confidence in knowing the true identity
of the individual requesting the information;
“(C)the
request for the information is based on a misrepresentation of fact by the
individual requesting the information relevant to the request for information;
or
“(D)the
information requested is Internet navigational data or similar information
about a person’s visit to a website or online service.
“(6)LIMITATION
ON LIABILITY. – Except as provided in section 621, sections 616 and 617 do not
apply to any violation of this subsection.
“(7)LIMITATION
ON CIVIL LIABILITY. – No business entity may be held civilly liable under any
provision of Federal, State, or other law for disclosure, made in good faith
pursuant to this subsection.
“(8)NO
NEW RECORDKEEPING OBLIGATION. – Nothing in this subsection creates an
obligation on the part of a business entity to obtain, retain, or maintain
information or records that are not otherwise required to be obtained,
retained, or maintained in the ordinary course of its business or under other applicable
law.
“(9)RULE
OF CONSTRUCTION. –
“(A)IN
GENERAL. – No provision of subtitle A of title V of Public Law 106–102,
prohibiting the disclosure of financial information by a business entity to
third parties shall be used to deny disclosure of information to the victim
under this subsection.
“(B)LIMITATION.
– Except as provided in subparagraph (A), nothing in this subsection permits a
business entity to disclose information, including information to law
enforcement under subparagraphs (B) and (C) of paragraph (1), that the business
entity is otherwise prohibited from disclosing under any other applicable
provision of Federal or State law.
“(10)AFFIRMATIVE
DEFENSE. – In any civil action brought to enforce this subsection, it is an
affirmative defense (which the defendant must establish by a preponderance of
the evidence) for a business entity to file an affidavit or answer stating that

“(A)the
business entity has made a reasonably diligent search of its available business
records; and
“(B)the
records requested under this subsection do not exist or are not reasonably
available.
“(11)DEFINITION
OF VICTIM. – For purposes of this subsection, the term ‘victim’ means a
consumer whose means of identification or financial information has been used
or transferred (or has been alleged to have been used or transferred) without
the authority of that consumer, with the intent to commit, or to aid or abet,
an identity theft or a similar crime.
“(12)EFFECTIVE
DATE. – This subsection shall become effective 180 days after the date of
enactment of this subsection.
“(13)EFFECTIVENESS
STUDY. – Not later than 18 months after the date of enactment of this
subsection, the Comptroller General of the United States shall submit a report
to Congress assessing the effectiveness of this provision.”.
(2)RELATION
TO STATE LAWS. – Section 625(b)(1) of the Fair Credit Reporting Act (15 U.S.C.
1681t(b)(1), as so redesignated) is amended by adding at the end the following
new subparagraph:
“(G)section
609(e), relating to information available to victims under section
609(e);”.
(b)PUBLIC
CAMPAIGN TO PREVENT IDENTITY THEFT. – Not later than 2 years after the date of
enactment of this Act, the Commission shall establish and implement a media and
distribution campaign to teach the public how to prevent identity theft. Such
campaign shall include existing Commission education materials, as well as
radio, television, and print public service announcements, video cassettes,
interactive digital video discs (DVD’s) or compact audio discs (CD’s), and Internet
resources.
SEC.
152. BLOCKING OF INFORMATION RESULTING FROM IDENTITY THEFT.
(a)IN
GENERAL. – The Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) is amended by
inserting after section 605A, as added by this Act, the following:
Ҥ
605B. Block of information resulting from identity theft
“(a)BLOCK.
– Except as otherwise provided in this section, a consumer reporting agency
shall block the reporting of any information in the file of a consumer that the
consumer identifies as information that resulted from an alleged identity
theft, not later than 4 business days after the date of receipt by such agency
of –
“(1)appropriate
proof of the identity of the consumer;
“(2)a
copy of an identity theft report;
“(3)the
identification of such information by the consumer; and
“(4)a
statement by the consumer that the information is not information relating to
any transaction by the consumer.
“(b)NOTIFICATION.
– A consumer reporting agency shall promptly notify the furnisher of
information identified by the consumer under subsection (a) –
“(1)that
the information may be a result of identity theft;
“(2)that
an identity theft report has been filed;
“(3)that
a block has been requested under this section; and
“(4)of
the effective dates of the block.
“(c)AUTHORITY
TO DECLINE OR RESCIND. –
“(1)IN
GENERAL. – A consumer reporting agency may decline to block, or may rescind any
block, of information relating to a consumer under this section, if the
consumer reporting agency reasonably determines that –
“(A)the
information was blocked in error or a block was requested by the consumer in
error;
“(B)the
information was blocked, or a block was requested by the consumer, on the basis
of a material misrepresentation of fact by the consumer relevant to the request
to block; or
“(C)the
consumer obtained possession of goods, services, or money as a result of the
blocked transaction or transactions.
“(2)NOTIFICATION
TO CONSUMER. – If a block of information is declined or rescinded under this
subsection, the affected consumer shall be notified promptly, in the same
manner as consumers are notified of the reinsertion of information under
section 611(a)(5)(B).
“(3)SIGNIFICANCE
OF BLOCK. – For purposes of this subsection, if a consumer reporting agency
rescinds a block, the presence of information in the file of a consumer prior
to the blocking of such information is not evidence of whether the consumer
knew or should have known that the consumer obtained possession of any goods,
services, or money as a result of the block.
“(d)EXCEPTION
FOR RESELLERS. –
“(1)NO
RESELLER FILE. – This section shall not apply to a consumer reporting agency,
if the consumer reporting agency –
“(A)is
a reseller;
“(B)is
not, at the time of the request of the consumer under subsection (a), otherwise
furnishing or reselling a consumer report concerning the information identified
by the consumer; and
“(C)informs
the consumer, by any means, that the consumer may report the identity theft to
the Commission to obtain consumer information regarding identity theft.
“(2)RESELLER
WITH FILE. – The sole obligation of the consumer reporting agency under this
section, with regard to any request of a consumer under this section, shall be
to block the consumer report maintained by the consumer reporting agency from
any subsequent use, if –
“(A)the
consumer, in accordance with the provisions of subsection (a), identifies, to a
consumer reporting agency, information in the file of the consumer that
resulted from identity theft; and
“(B)the
consumer reporting agency is a reseller of the identified information.
“(3)NOTICE.
– In carrying out its obligation under paragraph (2), the reseller shall
promptly provide a notice to the consumer of the decision to block the file.
Such notice shall contain the name, address, and telephone number of each consumer
reporting agency from which the consumer information was obtained for resale.
“(e)EXCEPTION
FOR VERIFICATION COMPANIES. – The provisions of this section do not apply to a
check services company, acting as such, which issues authorizations for the purpose
of approving or processing negotiable instruments, electronic fund transfers,
or similar methods of payments, except that, beginning 4 business days after
receipt of information described in paragraphs (1) through (3) of subsection
(a), a check services company shall not report to a national consumer reporting
agency described in section 603(p), any information identified in the subject
identity theft report as resulting from identity theft.
“(f)ACCESS
TO BLOCKED INFORMATION BY LAW ENFORCEMENT AGENCIES. – No provision of this
section shall be construed as requiring a consumer reporting agency to prevent
a Federal, State, or local law enforcement agency from accessing blocked
information in a consumer file to which the agency could otherwise obtain access
under this title.”.
(b)CLERICAL
AMENDMENT. – The table of sections for the Fair Credit Reporting Act (15 U.S.C.
1681 et seq.) is amended by inserting after the item relating to section 605
the following new items:
“605A.
Identity theft prevention; fraud alerts and active duty alerts.
“605B. Block of information resulting from identity theft.”.
SEC.
153. COORDINATION OF IDENTITY THEFT COMPLAINT INVESTIGATIONS.
Section
621 of the Fair Credit Reporting Act (15 U.S.C. 1681s) is amended by adding at
the end the following:
“(f)COORDINATION
OF CONSUMER COMPLAINT INVESTIGATIONS. –
“(1)IN
GENERAL. – Each consumer reporting agency described in section 603(p) shall
develop and maintain procedures for the referral to each other such agency of
any consumer complaint received by the agency alleging identity theft, or
requesting a fraud alert under section 605A or a block under section 605B.
“(2)MODEL
FORM AND PROCEDURE FOR REPORTING IDENTITY THEFT. – The Commission, in
consultation with the Federal banking agencies and the National Credit Union
Administration, shall develop a model form and model procedures to be used by
consumers who are victims of identity theft for contacting and informing
creditors and consumer reporting agencies of the fraud.
“(3)ANNUAL
SUMMARY REPORTS. – Each consumer reporting agency described in section 603(p)
shall submit an annual summary report to the Commission on consumer complaints
received by the agency on identity theft or fraud alerts.”.
SEC.
154. PREVENTION OF REPOLLUTION OF CONSUMER REPORTS.
(a)PREVENTION
OF REINSERTION OF ERRONEOUS INFORMATION. – Section 623(a) of the Fair Credit
Reporting Act (15 U.S.C. 1681s–2(a)) is amended by adding at the end the
following:
“(6)DUTIES
OF FURNISHERS UPON NOTICE OF IDENTITY THEFT-RELATED INFORMATION. –
“(A)REASONABLE
PROCEDURES. – A person that furnishes information to any consumer reporting
agency shall have in place reasonable procedures to respond to any notification
that it receives from a consumer reporting agency under section 605B relating to
information resulting from identity theft, to prevent that person from
refurnishing such blocked information.
“(B)INFORMATION
ALLEGED TO RESULT FROM IDENTITY THEFT. – If a consumer submits an identity
theft report to a person who furnishes information to a consumer reporting
agency at the address specified by that person for receiving such reports
stating that information maintained by such person that purports to relate to
the consumer resulted from identity theft, the person may not furnish such
information that purports to relate to the consumer to any consumer reporting
agency, unless the person subsequently knows or is informed by the consumer
that the information is correct.”.
(b)PROHIBITION
ON SALE OR TRANSFER OF DEBT CAUSED BY IDENTITY THEFT. – Section 615 of the Fair
Credit Reporting Act (15 U.S.C. 1681m), as amended by this Act, is amended by
adding at the end the following:
“(f)PROHIBITION
ON SALE OR TRANSFER OF DEBT CAUSED BY IDENTITY THEFT. –
“(1)IN
GENERAL. – No person shall sell, transfer for consideration, or place for
collection a debt that such person has been notified under section 605B has
resulted from identity theft.
“(2)APPLICABILITY.
– The prohibitions of this subsection shall apply to all persons collecting a
debt described in paragraph (1) after the date of a notification under
paragraph (1).
“(3)RULE
OF CONSTRUCTION. – Nothing in this subsection shall be construed to prohibit –
“(A)the
repurchase of a debt in any case in which the assignee of the debt requires
such repurchase because the debt has resulted from identity theft;
“(B)the
securitization of a debt or the pledging of a portfolio of debt as collateral
in connection with a borrowing; or
“(C)the
transfer of debt as a result of a merger, acquisition, purchase and assumption
transaction, or transfer of substantially all of the assets of an
entity.”.
SEC.
155. NOTICE BY DEBT COLLECTORS WITH RESPECT TO FRAUDULENT INFORMATION.
Section
615 of the Fair Credit Reporting Act (15 U.S.C. 1681m), as amended by this Act,
is amended by adding at the end the following:
“(g)DEBT
COLLECTOR COMMUNICATIONS CONCERNING IDENTITY THEFT. – If a person acting as a
debt collector (as that term is defined in title VIII) on behalf of a third
party that is a creditor or other user of a consumer report is notified that
any information relating to a debt that the person is attempting to collect may
be fraudulent or may be the result of identity theft, that person shall –
“(1)notify
the third party that the information may be fraudulent or may be the result of
identity theft; and
“(2)upon
request of the consumer to whom the debt purportedly relates, provide to the
consumer all information to which the consumer would otherwise be entitled if
the consumer were not a victim of identity theft, but wished to dispute the
debt under provisions of law applicable to that person.”.
SEC.
156. STATUTE OF LIMITATIONS.
Section
618 of the Fair Credit Reporting Act (15 U.S.C. 1681p) is amended to read as
follows:
Ҥ
618. Jurisdiction of courts; limitation of actions
“An
action to enforce any liability created under this title may be brought in any
appropriate United States district court, without regard to the amount in
controversy, or in any other court of competent jurisdiction, not later than
the earlier of –
“(1)2
years after the date of discovery by the plaintiff of the violation that is the
basis for such liability; or
“(2)5
years after the date on which the violation that is the basis for such
liability occurs.”.
SEC.
157. STUDY ON THE USE OF TECHNOLOGY TO COMBAT IDENTITY THEFT.
(a)STUDY
REQUIRED. – The Secretary of the Treasury shall conduct a study of the use of
biometrics and other similar technologies to reduce the incidence and costs to
society of identity theft by providing convincing evidence of who actually
performed a given financial transaction.
(b)CONSULTATION.
– The Secretary of the Treasury shall consult with Federal banking agencies,
the Commission, and representatives of financial institutions, consumer
reporting agencies, Federal, State, and local government agencies that issue
official forms or means of identification, State prosecutors, law enforcement
agencies, the biometric industry, and the general public in formulating and
conducting the study required by subsection (a).
(c)AUTHORIZATION
OF APPROPRIATIONS. – There are authorized to be appropriated to the Secretary
of the Treasury for fiscal year 2004, such sums as may be necessary to carry
out the provisions of this section.
(d)REPORT
REQUIRED. – Before the end of the 180-day period beginning on the date of
enactment of this Act, the Secretary shall submit a report to Congress
containing the findings and conclusions of the study required under subsection
(a), together with such recommendations for legislative or administrative
actions as may be appropriate.
TITLE
II – IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT INFORMATION
SEC.
211. FREE CONSUMER REPORTS.
(a)IN
GENERAL. – Section 612 of the Fair Credit Reporting Act (15 U.S.C. 1681j) is
amended –
(1)by
redesignating subsection (a) as subsection (f), and transferring it to the end
of the section;
(2)by
inserting before subsection (b) the following:
“(a)FREE
ANNUAL DISCLOSURE. –
“(1)NATIONWIDE
CONSUMER REPORTING AGENCIES. –
“(A)IN
GENERAL. – All consumer reporting agencies described in subsections (p) and (w)
of section 603 shall make all disclosures pursuant to section 609 once during
any 12-month period upon request of the consumer and without charge to the
consumer.
“(B)CENTRALIZED
SOURCE. – Subparagraph (A) shall apply with respect to a consumer reporting
agency described in section 603(p) only if the request from the consumer is
made using the centralized source established for such purpose in accordance
with section 211(c) of the Fair and Accurate Credit Transactions Act of 2003.
“(C)NATIONWIDE
SPECIALTY CONSUMER REPORTING AGENCY. –
“(i)IN
GENERAL. – The Commission shall prescribe regulations applicable to each
consumer reporting agency described in section 603(w) to require the
establishment of a streamlined process for consumers to request consumer
reports under subparagraph (A), which shall include, at a minimum, the
establishment by each such agency of a toll-free telephone number for such
requests.
“(ii)CONSIDERATIONS.
– In prescribing regulations under clause (i), the Commission shall consider –
“(I)the
significant demands that may be placed on consumer reporting agencies in
providing such consumer reports;
“(II)appropriate
means to ensure that consumer reporting agencies can satisfactorily meet those
demands, including the efficacy of a system of staggering the availability to
consumers of such consumer reports; and
“(III)the
ease by which consumers should be able to contact consumer reporting agencies
with respect to access to such consumer reports.
“(iii)DATE
OF ISSUANCE. – The Commission shall issue the regulations required by this
subparagraph in final form not later than 6 months after the date of enactment
of the Fair and Accurate Credit Transactions Act of 2003.
“(iv)CONSIDERATION
OF ABILITY TO COMPLY. – The regulations of the Commission under this
subparagraph shall establish an effective date by which each nationwide
specialty consumer reporting agency (as defined in section 603(w)) shall be
required to comply with subsection (a), which effective date –
“(I)shall
be established after consideration of the ability of each nationwide specialty
consumer reporting agency to comply with subsection (a); and
“(II)shall
be not later than 6 months after the date on which such regulations are issued
in final form (or such additional period not to exceed 3 months, as the
Commission determines appropriate).
“(2)TIMING.
– A consumer reporting agency shall provide a consumer report under paragraph
(1) not later than 15 days after the date on which the request is received
under paragraph (1).
“(3)REINVESTIGATIONS.
– Notwithstanding the time periods specified in section 611(a)(1), a
reinvestigation under that section by a consumer reporting agency upon a
request of a consumer that is made after receiving a consumer report under this
subsection shall be completed not later than 45 days after the date on which
the request is received.
“(4)EXCEPTION
FOR FIRST 12 MONTHS OF OPERATION. – This subsection shall not apply to a
consumer reporting agency that has not been furnishing consumer reports to
third parties on a continuing basis during the 12-month period preceding a
request under paragraph (1), with respect to consumers residing
nationwide.”;
(3)by
redesignating subsection (d) as subsection (e);
(4)by
inserting before subsection (e), as redesignated, the following:
“(d)FREE
DISCLOSURES IN CONNECTION WITH FRAUD ALERTS. – Upon the request of a consumer,
a consumer reporting agency described in section 603(p) shall make all
disclosures pursuant to section 609 without charge to the consumer, as provided
in subsections (a)(2) and (b)(2) of section 605A, as applicable.”;
(5)in
subsection (e), as redesignated, by striking “subsection (a)” and
inserting “subsection (f)”; and
(6)in
subsection (f), as redesignated, by striking “Except as provided in
subsections (b), (c), and (d), a” and inserting “In the case of a
request from a consumer other than a request that is covered by any of
subsections (a) through (d), a”.
(b)CIRCUMVENTION
PROHIBITED. – The Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) is amended
by adding after section 628, as added by section 216 of this Act, the following
new section:
Ҥ
629. Corporate and technological circumvention prohibited
“The
Commission shall prescribe regulations, to become effective not later than 90
days after the date of enactment of this section, to prevent a consumer
reporting agency from circumventing or evading treatment as a consumer
reporting agency described in section 603(p) for purposes of this title,
including –
“(1)by
means of a corporate reorganization or restructuring, including a merger,
acquisition, dissolution, divestiture, or asset sale of a consumer reporting
agency; or
“(2)by
maintaining or merging public record and credit account information in a manner
that is substantially equivalent to that described in paragraphs (1) and (2) of
section 603(p), in the manner described in section 603(p).”.
(c)SUMMARY
OF RIGHTS TO OBTAIN AND DISPUTE INFORMATION IN CONSUMER REPORTS AND TO OBTAIN
CREDIT SCORES. – Section 609(c) of the Fair Credit Reporting Act (15 U.S.C.
1681g) is amended to read as follows:
“(c)SUMMARY
OF RIGHTS TO OBTAIN AND DISPUTE INFORMATION IN CONSUMER REPORTS AND TO OBTAIN
CREDIT SCORES. –
“(1)COMMISSION
SUMMARY OF RIGHTS REQUIRED. –
“(A)IN
GENERAL. – The Commission shall prepare a model summary of the rights of
consumers under this title.
“(B)CONTENT
OF SUMMARY. – The summary of rights prepared under subparagraph (A) shall
include a description of –
“(i)the
right of a consumer to obtain a copy of a consumer report under subsection (a)
from each consumer reporting agency;
“(ii)the
frequency and circumstances under which a consumer is entitled to receive a
consumer report without charge under section 612;
“(iii)the
right of a consumer to dispute information in the file of the consumer under
section 611;
“(iv)the
right of a consumer to obtain a credit score from a consumer reporting agency,
and a description of how to obtain a credit score;
“(v)the
method by which a consumer can contact, and obtain a consumer report from, a
consumer reporting agency without charge, as provided in the regulations of the
Commission prescribed under section 211(c) of the Fair and Accurate Credit
Transactions Act of 2003; and
“(vi)the
method by which a consumer can contact, and obtain a consumer report from, a
consumer reporting agency described in section 603(w), as provided in the
regulations of the Commission prescribed under section 612(a)(1)(C).
“(C)AVAILABILITY
OF SUMMARY OF RIGHTS. – The Commission shall –
“(i)actively
publicize the availability of the summary of rights prepared under this
paragraph;
“(ii)conspicuously
post on its Internet website the availability of such summary of rights; and
“(iii)promptly
make such summary of rights available to consumers, on request.
“(2)SUMMARY
OF RIGHTS REQUIRED TO BE INCLUDED WITH AGENCY DISCLOSURES. – A consumer
reporting agency shall provide to a consumer, with each written disclosure by
the agency to the consumer under this section –
“(A)the
summary of rights prepared by the Commission under paragraph (1);
“(B)in
the case of a consumer reporting agency described in section 603(p), a
toll-free telephone number established by the agency, at which personnel are
accessible to consumers during normal business hours;
“(C)a
list of all Federal agencies responsible for enforcing any provision of this
title, and the address and any appropriate phone number of each such agency, in
a form that will assist the consumer in selecting the appropriate agency;
“(D)a
statement that the consumer may have additional rights under State law, and
that the consumer may wish to contact a State or local consumer protection
agency or a State attorney general (or the equivalent thereof) to learn of
those rights; and
“(E)a
statement that a consumer reporting agency is not required to remove accurate
derogatory information from the file of a consumer, unless the information is
outdated under section 605 or cannot be verified.”.
(d)RULEMAKING
REQUIRED. –
(1)IN
GENERAL. – The Commission shall prescribe regulations applicable to consumer
reporting agencies described in section 603(p) of the Fair Credit Reporting
Act, to require the establishment of –
(A)a
centralized source through which consumers may obtain a consumer report from
each such consumer reporting agency, using a single request, and without charge
to the consumer, as provided in section 612(a) of the Fair Credit Reporting Act
(as amended by this section); and
(B)a
standardized form for a consumer to make such a request for a consumer report
by mail or through an Internet website.
(2)CONSIDERATIONS.
– In prescribing regulations under paragraph (1), the Commission shall consider

(A)the
significant demands that may be placed on consumer reporting agencies in
providing such consumer reports;
(B)appropriate
means to ensure that consumer reporting agencies can satisfactorily meet those
demands, including the efficacy of a system of staggering the availability to
consumers of such consumer reports; and
(C)the
ease by which consumers should be able to contact consumer reporting agencies
with respect to access to such consumer reports.
(3)CENTRALIZED
SOURCE. – The centralized source for a request for a consumer report from a
consumer required by this subsection shall provide for –
(A)a
toll-free telephone number for such purpose;
(B)use
of an Internet website for such purpose; and
(C)a
process for requests by mail for such purpose.
(4)TRANSITION.
– The regulations of the Commission under paragraph (1) shall provide for an
orderly transition by consumer reporting agencies described in section 603(p)
of the Fair Credit Reporting Act to the centralized source for consumer report
distribution required by section 612(a)(1)(B), as amended by this section, in a
manner that –
(A)does
not temporarily overwhelm such consumer reporting agencies with requests for
disclosures of consumer reports beyond their capacity to deliver; and
(B)does
not deny creditors, other users, and consumers access to consumer reports on a
time-sensitive basis for specific purposes, such as home purchases or
suspicions of identity theft, during the transition period.
(5)TIMING.
– Regulations required by this subsection shall –
(A)be
issued in final form not later than 6 months after the date of enactment of
this Act; and
(B)become
effective not later than 6 months after the date on which they are issued in
final form.
(6)SCOPE
OF REGULATIONS. –
(A)IN
GENERAL. – The Commission shall, by rule, determine whether to require a
consumer reporting agency that compiles and maintains files on consumers on
substantially a nationwide basis, other than one described in section 603(p) of
the Fair Credit Reporting Act, to make free consumer reports available upon
consumer request, and if so, whether such consumer reporting agencies should
make such free reports available through the centralized source described in
paragraph (1)(A).
(B)CONSIDERATIONS.
– Before making any determination under subparagraph (A), the Commission shall
consider –
(i)the
number of requests for consumer reports to, and the number of consumer reports
generated by, the consumer reporting agency, in comparison with consumer
reporting agencies described in subsections (p) and (w) of section 603 of the
Fair Credit Reporting Act;
(ii)the
overall scope of the operations of the consumer reporting agency;
(iii)the
needs of consumers for access to consumer reports provided by consumer
reporting agencies free of charge;
(iv)the
costs of providing access to consumer reports by consumer reporting agencies
free of charge; and
(v)the
effects on the ongoing competitive viability of such consumer reporting
agencies if such free access is required.
SEC.
212. DISCLOSURE OF CREDIT SCORES.
(a)STATEMENT
ON AVAILABILITY OF CREDIT SCORES. – Section 609(a) of the Fair Credit Reporting
Act (15 U.S.C. 1681g(a)) is amended by adding at the end the following new
paragraph:
“(6)If
the consumer requests the credit file and not the credit score, a statement
that the consumer may request and obtain a credit score.”.
(b)DISCLOSURE
OF CREDIT SCORES. – Section 609 of the Fair Credit Reporting Act (15 U.S.C.
1681g), as amended by this Act, is amended by adding at the end the following:
“(f)DISCLOSURE
OF CREDIT SCORES. –
“(1)IN
GENERAL. – Upon the request of a consumer for a credit score, a consumer
reporting agency shall supply to the consumer a statement indicating that the
information and credit scoring model may be different than the credit score
that may be used by the lender, and a notice which shall include –
“(A)the
current credit score of the consumer or the most recent credit score of the
consumer that was previously calculated by the credit reporting agency for a
purpose related to the extension of credit;
“(B)the
range of possible credit scores under the model used;
“(C)all
of the key factors that adversely affected the credit score of the consumer in
the model used, the total number of which shall not exceed 4, subject to
paragraph (9);
“(D)the
date on which the credit score was created; and
“(E)the
name of the person or entity that provided the credit score or credit file upon
which the credit score was created.
“(2)DEFINITIONS.
– For purposes of this subsection, the following definitions shall apply:
“(A)CREDIT
SCORE. – The term ‘credit score’ –
“(i)means
a numerical value or a categorization derived from a statistical tool or
modeling system used by a person who makes or arranges a loan to predict the
likelihood of certain credit behaviors, including default (and the numerical
value or the categorization derived from such analysis may also be referred to
as a ‘risk predictor’ or ‘risk score’); and
“(ii)does
not include –
“(I)any
mortgage score or rating of an automated underwriting system that considers one
or more factors in addition to credit information, including the loan to value
ratio, the amount of down payment, or the financial assets of a consumer; or
“(II)any
other elements of the underwriting process or underwriting decision.
“(B)KEY
FACTORS. – The term ‘key factors’ means all relevant elements or reasons
adversely affecting the credit score for the particular individual, listed in
the order of their importance based on their effect on the credit score.
“(3)TIMEFRAME
AND MANNER OF DISCLOSURE. – The information required by this subsection shall
be provided in the same timeframe and manner as the information described in
subsection (a).
“(4)APPLICABILITY
TO CERTAIN USES. – This subsection shall not be construed so as to compel a
consumer reporting agency to develop or disclose a score if the agency does not

“(A)distribute
scores that are used in connection with residential real property loans; or
“(B)develop
scores that assist credit providers in understanding the general credit
behavior of a consumer and predicting the future credit behavior of the
consumer.
“(5)APPLICABILITY
TO CREDIT SCORES DEVELOPED BY ANOTHER PERSON. –
“(A)IN
GENERAL. – This subsection shall not be construed to require a consumer
reporting agency that distributes credit scores developed by another person or
entity to provide a further explanation of them, or to process a dispute
arising pursuant to section 611, except that the consumer reporting agency
shall provide the consumer with the name and address and website for contacting
the person or entity who developed the score or developed the methodology of
the score.
“(B)EXCEPTION.
– This paragraph shall not apply to a consumer reporting agency that develops
or modifies scores that are developed by another person or entity.
“(6)MAINTENANCE
OF CREDIT SCORES NOT REQUIRED. – This subsection shall not be construed to
require a consumer reporting agency to maintain credit scores in its files.
“(7)COMPLIANCE
IN CERTAIN CASES. – In complying with this subsection, a consumer reporting
agency shall –
“(A)supply
the consumer with a credit score that is derived from a credit scoring model
that is widely distributed to users by that consumer reporting agency in
connection with residential real property loans or with a credit score that
assists the consumer in understanding the credit scoring assessment of the
credit behavior of the consumer and predictions about the future credit
behavior of the consumer; and
“(B)a
statement indicating that the information and credit scoring model may be
different than that used by the lender.
“(8)FAIR
AND REASONABLE FEE. – A consumer reporting agency may charge a fair and
reasonable fee, as determined by the Commission, for providing the information
required under this subsection.
“(9)USE
OF ENQUIRIES AS A KEY FACTOR. – If a key factor that adversely affects the
credit score of a consumer consists of the number of enquiries made with
respect to a consumer report, that factor shall be included in the disclosure
pursuant to paragraph (1)(C) without regard to the numerical limitation in such
paragraph.”.
(c)DISCLOSURE
OF CREDIT SCORES BY CERTAIN MORTGAGE LENDERS. – Section 609 of the Fair Credit
Reporting Act (15 U.S.C. 1681g), as amended by this Act, is amended by adding
at the end the following:
“(g)DISCLOSURE
OF CREDIT SCORES BY CERTAIN MORTGAGE LENDERS. –
“(1)IN
GENERAL. – Any person who makes or arranges loans and who uses a consumer
credit score, as defined in subsection (f), in connection with an application
initiated or sought by a consumer for a closed end loan or the establishment of
an open end loan for a consumer purpose that is secured by 1 to 4 units of
residential real property (hereafter in this subsection referred to as the
‘lender’) shall provide the following to the consumer as soon as reasonably
practicable:
“(A)INFORMATION
REQUIRED UNDER SUBSECTION (f ). –
“(i)IN
GENERAL. – A copy of the information identified in subsection (f) that was
obtained from a consumer reporting agency or was developed and used by the user
of the information.
“(ii)NOTICE
UNDER SUBPARAGRAPH (D). – In addition to the information provided to it by a
third party that provided the credit score or scores, a lender is only required
to provide the notice contained in subparagraph (D).
“(B)DISCLOSURES
IN CASE OF AUTOMATED UNDERWRITING SYSTEM. –
“(i)IN
GENERAL. – If a person that is subject to this subsection uses an automated
underwriting system to underwrite a loan, that person may satisfy the
obligation to provide a credit score by disclosing a credit score and
associated key factors supplied by a consumer reporting agency.
“(ii)NUMERICAL
CREDIT SCORE. – However, if a numerical credit score is generated by an
automated underwriting system used by an enterprise, and that score is
disclosed to the person, the score shall be disclosed to the consumer
consistent with subparagraph (C).
“(iii)ENTERPRISE
DEFINED. – For purposes of this subparagraph, the term ‘enterprise’ has the
same meaning as in paragraph (6) of section 1303 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992.
“(C)DISCLOSURES
OF CREDIT SCORES NOT OBTAINED FROM A CONSUMER REPORTING AGENCY. – A person that
is subject to the provisions of this subsection and that uses a credit score,
other than a credit score provided by a consumer reporting agency, may satisfy
the obligation to provide a credit score by disclosing a credit score and
associated key factors supplied by a consumer reporting agency.
“(D)NOTICE
TO HOME LOAN APPLICANTS. – A copy of the following notice, which shall include
the name, address, and telephone number of each consumer reporting agency
providing a credit score that was used:
‘NOTICE
TO THE HOME LOAN APPLICANT
‘In
connection with your application for a home loan, the lender must disclose to
you the score that a consumer reporting agency distributed to users and the
lender used in connection with your home loan, and the key factors affecting
your credit scores.
‘The
credit score is a computer generated summary calculated at the time of the
request and based on information that a consumer reporting agency or lender has
on file. The scores are based on data about your credit history and payment
patterns. Credit scores are important because they are used to assist the lender
in determining whether you will obtain a loan. They may also be used to
determine what interest rate you may be offered on the mortgage. Credit scores
can change over time, depending on your conduct, how your credit history and
payment patterns change, and how credit scoring technologies change.
‘Because
the score is based on information in your credit history, it is very important
that you review the credit-related information that is being furnished to make
sure it is accurate. Credit records may vary from one company to another.
‘If
you have questions about your credit score or the credit information that is
furnished to you, contact the consumer reporting agency at the address and
telephone number provided with this notice, or contact the lender, if the
lender developed or generated the credit score. The consumer reporting agency
plays no part in the decision to take any action on the loan application and is
unable to provide you with specific reasons for the decision on a loan
application.
‘If
you have questions concerning the terms of the loan, contact the lender.’.
“(E)ACTIONS
NOT REQUIRED UNDER THIS SUBSECTION. – This subsection shall not require any
person to –
“(i)explain
the information provided pursuant to subsection (f);
“(ii)disclose
any information other than a credit score or key factors, as defined in
subsection (f);
“(iii)disclose
any credit score or related information obtained by the user after a loan has
closed;
“(iv)provide
more than 1 disclosure per loan transaction; or
“(v)provide
the disclosure required by this subsection when another person has made the
disclosure to the consumer for that loan transaction.
“(F)NO
OBLIGATION FOR CONTENT. –
“(i)IN
GENERAL. – The obligation of any person pursuant to this subsection shall be
limited solely to providing a copy of the information that was received from
the consumer reporting agency.
“(ii)LIMIT
ON LIABILITY. – No person has liability under this subsection for the content
of that information or for the omission of any information within the report
provided by the consumer reporting agency.
“(G)PERSON
DEFINED AS EXCLUDING ENTERPRISE. – As used in this subsection, the term
‘person’ does not include an enterprise (as defined in paragraph (6) of section
1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of
1992).
“(2)PROHIBITION
ON DISCLOSURE CLAUSES NULL AND VOID. –
“(A)IN
GENERAL. – Any provision in a contract that prohibits the disclosure of a
credit score by a person who makes or arranges loans or a consumer reporting
agency is void.
“(B)NO
LIABILITY FOR DISCLOSURE UNDER THIS SUBSECTION. – A lender shall not have
liability under any contractual provision for disclosure of a credit score
pursuant to this subsection.”.
(d)INCLUSION
OF KEY FACTOR IN CREDIT SCORE INFORMATION IN CONSUMER REPORT. – Section 605(d)
of the Fair Credit Reporting Act (15 U.S.C. 1681c(d)) is amended –
(1)by
striking “DISCLOSED. – Any consumer reporting agency” and inserting
“DISCLOSED. –
“(1)TITLE
11 INFORMATION. – Any consumer reporting agency”; and
(2)by
adding at the end the following new paragraph:
“(2)KEY
FACTOR IN CREDIT SCORE INFORMATION. – Any consumer reporting agency that
furnishes a consumer report that contains any credit score or any other risk
score or predictor on any consumer shall include in the report a clear and
conspicuous statement that a key factor (as defined in section 609(f)(2)(B))
that adversely affected such score or predictor was the number of enquiries, if
such a predictor was in fact a key factor that adversely affected such score.
This paragraph shall not apply to a check services company, acting as such,
which issues authorizations for the purpose of approving or processing
negotiable instruments, electronic fund transfers, or similar methods of
payments, but only to the extent that such company is engaged in such
activities.”.
(e)TECHNICAL
AND CONFORMING AMENDMENTS. – Section 625(b) of the Fair Credit Reporting Act
(15 U.S.C. 1681t(b)), as so designated by section 214 of this Act, is amended –
(1)by
striking “or” at the end of paragraph (2); and
(2)by
striking paragraph (3) and inserting the following:
“(3)with
respect to the disclosures required to be made under subsection (c), (d), (e),
or (g) of section 609, or subsection (f) of section 609 relating to the
disclosure of credit scores for credit granting purposes, except that this
paragraph –
“(A)shall
not apply with respect to sections 1785.10, 1785.16, and 1785.20.2 of the
California Civil Code (as in effect on the date of enactment of the Fair and
Accurate Credit Transactions Act of 2003) and section 1785.15 through section
1785.15.2 of such Code (as in effect on such date);
“(B)shall
not apply with respect to sections 5–3–106(2) and 212–14.3–104.3 of the
Colorado Revised Statutes (as in effect on the date of enactment of the Fair
and Accurate Credit Transactions Act of 2003); and
“(C)shall
not be construed as limiting, annulling, affecting, or superseding any
provision of the laws of any State regulating the use in an insurance activity,
or regulating disclosures concerning such use, of a credit-based insurance
score of a consumer by any person engaged in the business of insurance;
“(4)with
respect to the frequency of any disclosure under section 612(a), except that
this paragraph shall not apply –
“(A)with
respect to section 12–14.3–105(1)(d) of the Colorado Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003);
“(B)with
respect to section 10–1–393(29)(C) of the Georgia Code (as in effect on the
date of enactment of the Fair and Accurate Credit Transactions Act of 2003);
“(C)with
respect to section 1316.2 of title 10 of the Maine Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003);
“(D)with
respect to sections 14–1209(a)(1) and 14– 1209(b)(1)(i) of the Commercial Law
Article of the Code of Maryland (as in effect on the date of enactment of the
Fair and Accurate Credit Transactions Act of 2003);
“(E)with
respect to section 59(d) and section 59(e) of chapter 93 of the General Laws of
Massachusetts (as in effect on the date of enactment of the Fair and Accurate
Credit Transactions Act of 2003);
“(F)with
respect to section 56:11–37.10(a)(1) of the New Jersey Revised Statutes (as in
effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003); or
“(G)with
respect to section 2480c(a)(1) of title 9 of the Vermont Statutes Annotated (as
in effect on the date of enactment of the Fair and Accurate Credit Transactions
Act of 2003); or”.
SEC.
213. ENHANCED DISCLOSURE OF THE MEANS AVAILABLE TO OPT OUT OF PRESCREENED
LISTS.
(a)NOTICE
AND RESPONSE FORMAT FOR USERS OF REPORTS. – Section 615(d)(2) of the Fair
Credit Reporting Act (15 U.S.C. 1681m(d)(2)) is amended to read as follows:
“(2)DISCLOSURE
OF ADDRESS AND TELEPHONE NUMBER; FORMAT. – A statement under paragraph (1)
shall –
“(A)include
the address and toll-free telephone number of the appropriate notification
system established under section 604(e); and
“(B)be
presented in such format and in such type size and manner as to be simple and
easy to understand, as established by the Commission, by rule, in consultation
with the Federal banking agencies and the National Credit Union
Administration.”.
(b)RULEMAKING
SCHEDULE. – Regulations required by section 615(d)(2) of the Fair Credit
Reporting Act, as amended by this section, shall be issued in final form not
later than 1 year after the date of enactment of this Act.
(c)DURATION
OF ELECTIONS. – Section 604(e) of the Fair Credit Reporting Act (15 U.S.C.
1681b(e)) is amended in each of paragraphs (3)(A) and (4)(B)(i)), by striking
“2-year period” each place that term appears and inserting
“5-year period”.
(d)PUBLIC
AWARENESS CAMPAIGN. – The Commission shall actively publicize and conspicuously
post on its website any address and the toll-free telephone number established
as part of a notification system for opting out of prescreening under section
604(e) of the Fair Credit Reporting Act (15 U.S.C. 1681b(e)), and otherwise
take measures to increase public awareness regarding the availability of the
right to opt out of prescreening.
(e)ANALYSIS
OF FURTHER RESTRICTIONS ON OFFERS OF CREDIT OR INSURANCE. –
(1)IN
GENERAL. – The Board shall conduct a study of –
(A)the
ability of consumers to avoid receiving written offers of credit or insurance
in connection with transactions not initiated by the consumer; and
(B)the
potential impact that any further restrictions on providing consumers with such
written offers of credit or insurance would have on consumers.
(2)REPORT.
– The Board shall submit a report summarizing the results of the study required
under paragraph (1) to the Congress not later than 12 months after the date of
enactment of this Act, together with such recommendations for legislative or
administrative action as the Board may determine to be appropriate.
(3)CONTENT
OF REPORT. – The report described in paragraph (2) shall address the following
issues:
(A)The
current statutory or voluntary mechanisms that are available to a consumer to
notify lenders and insurance providers that the consumer does not wish to
receive written offers of credit or insurance.
(B)The
extent to which consumers are currently utilizing existing statutory and
voluntary mechanisms to avoid receiving offers of credit or insurance.
(C)The
benefits provided to consumers as a result of receiving written offers of
credit or insurance.
(D)Whether
consumers incur significant costs or are otherwise adversely affected by the
receipt of written offers of credit or insurance.
(E)Whether
further restricting the ability of lenders and insurers to provide written
offers of credit or insurance to consumers would affect –
(i)the
cost consumers pay to obtain credit or insurance;
(ii)the
availability of credit or insurance;
(iii)consumers’
knowledge about new or alternative products and services;
(iv)the
ability of lenders or insurers to compete with one another; and
(v)the
ability to offer credit or insurance products to consumers who have been
traditionally underserved.
SEC.
214. AFFILIATE SHARING.
(a)LIMITATION.
– The Fair Credit Reporting Act (15 U.S.C. 1601 et seq.) is amended –
(1)by
redesignating sections 624 (15 U.S.C. 1681t), 625 (15 U.S.C. 1681u), and 626
(15 U.S.C. 6181v) as sections 625, 626, and 627, respectively; and
(2)by
inserting after section 623 the following:
Ҥ
624. Affiliate sharing
“(a)SPECIAL
RULE FOR SOLICITATION FOR PURPOSES OF MARKETING. –
“(1)NOTICE.
– Any person that receives from another person related to it by common
ownership or affiliated by corporate control a communication of information
that would be a consumer report, but for clauses (i), (ii), and (iii) of
section 603(d)(2)(A), may not use the information to make a solicitation for
marketing purposes to a consumer about its products or services, unless –
“(A)it
is clearly and conspicuously disclosed to the consumer that the information may
be communicated among such persons for purposes of making such solicitations to
the consumer; and
“(B)the
consumer is provided an opportunity and a simple method to prohibit the making
of such solicitations to the consumer by such person.
“(2)CONSUMER
CHOICE. –
“(A)IN
GENERAL. – The notice required under paragraph (1) shall allow the consumer the
opportunity to prohibit all solicitations referred to in such paragraph, and
may allow the consumer to choose from different options when electing to
prohibit the sending of such solicitations, including options regarding the
types of entities and information covered, and which methods of delivering
solicitations the consumer elects to prohibit.
“(B)FORMAT.
– Notwithstanding subparagraph (A), the notice required under paragraph (1)
shall be clear, conspicuous, and concise, and any method provided under
paragraph (1)(B) shall be simple. The regulations prescribed to implement this
section shall provide specific guidance regarding how to comply with such
standards.
“(3)DURATION.

“(A)IN
GENERAL. – The election of a consumer pursuant to paragraph (1)(B) to prohibit
the making of solicitations shall be effective for at least 5 years, beginning
on the date on which the person receives the election of the consumer, unless
the consumer requests that such election be revoked.
“(B)NOTICE
UPON EXPIRATION OF EFFECTIVE PERIOD. – At such time as the election of a
consumer pursuant to 15 USC 1681s–3. paragraph (1)(B) is no longer effective, a
person may not use information that the person receives in the manner described
in paragraph (1) to make any solicitation for marketing purposes to the
consumer, unless the consumer receives a notice and an opportunity, using a
simple method, to extend the opt-out for another period of at least 5 years,
pursuant to the procedures described in paragraph (1).
“(4)SCOPE.
– This section shall not apply to a person –
“(A)using
information to make a solicitation for marketing purposes to a consumer with
whom the person has a pre-existing business relationship;
“(B)using
information to facilitate communications to an individual for whose benefit the
person provides employee benefit or other services pursuant to a contract with
an employer related to and arising out of the current employment relationship
or status of the individual as a participant or beneficiary of an employee
benefit plan;
“(C)using
information to perform services on behalf of another person related by common
ownership or affiliated by corporate control, except that this subparagraph
shall not be construed as permitting a person to send solicitations on behalf
of another person, if such other person would not be permitted to send the
solicitation on its own behalf as a result of the election of the consumer to
prohibit solicitations under paragraph (1)(B);
“(D)using
information in response to a communication initiated by the consumer;
“(E)using
information in response to solicitations authorized or requested by the
consumer; or
“(F)if
compliance with this section by that person would prevent compliance by that
person with any provision of State insurance laws pertaining to unfair
discrimination in any State in which the person is lawfully doing business.
“(5)NO
RETROACTIVITY. – This subsection shall not prohibit the use of information to
send a solicitation to a consumer if such information was received prior to the
date on which persons are required to comply with regulations implementing this
subsection.
“(b)NOTICE
FOR OTHER PURPOSES PERMISSIBLE. – A notice or other disclosure under this
section may be coordinated and consolidated with any other notice required to
be issued under any other provision of law by a person that is subject to this
section, and a notice or other disclosure that is equivalent to the notice
required by subsection (a), and that is provided by a person described in
subsection (a) to a consumer together with disclosures required by any other
provision of law, shall satisfy the requirements of subsection (a).
“(c)USER
REQUIREMENTS. – Requirements with respect to the use by a person of information
received from another person related to it by common ownership or affiliated by
corporate control, such as the requirements of this section, constitute
requirements with respect to the exchange of information among persons
affiliated by common ownership or common corporate control, within the meaning
of section 625(b)(2).
“(d)DEFINITIONS.
– For purposes of this section, the following definitions shall apply:
“(1)PRE-EXISTING
BUSINESS RELATIONSHIP. – The term ‘preexisting business relationship’ means a
relationship between a person, or a person’s licensed agent, and a consumer,
based on –
“(A)a
financial contract between a person and a consumer which is in force;
“(B)the
purchase, rental, or lease by the consumer of that person’s goods or services,
or a financial transaction (including holding an active account or a policy in
force or having another continuing relationship) between the consumer and that person
during the 18-month period immediately preceding the date on which the consumer
is sent a solicitation covered by this section;
“(C)an
inquiry or application by the consumer regarding a product or service offered
by that person, during the 3-month period immediately preceding the date on
which the consumer is sent a solicitation covered by this section; or
“(D)any
other pre-existing customer relationship defined in the regulations
implementing this section.
“(2)SOLICITATION.
– The term ‘solicitation’ means the marketing of a product or service initiated
by a person to a particular consumer that is based on an exchange of
information described in subsection (a), and is intended to encourage the
consumer to purchase such product or service, but does not include
communications that are directed at the general public or determined not to be
a solicitation by the regulations prescribed under this section.”.
(b)RULEMAKING
REQUIRED. –
(1)IN
GENERAL. – The Federal banking agencies, the National Credit Union Administration,
and the Commission, with respect to the entities that are subject to their
respective enforcement authority under section 621 of the Fair Credit Reporting
Act and the Securities and Exchange Commission, and in coordination as
described in paragraph (2), shall prescribe regulations to implement section
624 of the Fair Credit Reporting Act, as added by this section.
(2)COORDINATION.
– Each agency required to prescribe regulations under paragraph (1) shall
consult and coordinate with each other such agency so that, to the extent
possible, the regulations prescribed by each such entity are consistent and
comparable with the regulations prescribed by each other such agency.
(3)CONSIDERATIONS.
– In promulgating regulations under this subsection, each agency referred to in
paragraph (1) shall –
(A)ensure
that affiliate sharing notification methods provide a simple means for
consumers to make determinations and choices under section 624 of the Fair
Credit Reporting Act, as added by this section;
(B)consider
the affiliate sharing notification practices employed on the date of enactment
of this Act by persons that will be subject to that section 624; and
(C)ensure
that notices and disclosures may be coordinated and consolidated, as provided
in subsection (b) of that section 624.
(4)TIMING.
– Regulations required by this subsection shall –
(A)be
issued in final form not later than 9 months after the date of enactment of
this Act; and
(B)become
effective not later than 6 months after the date on which they are issued in
final form.
(c)TECHNICAL
AND CONFORMING AMENDMENTS. –
(1)DEFINITIONS.
– Section 603(d)(2)(A) of the Fair Credit Reporting Act (15 U.S.C.
1681(d)(2)(A)) is amended by inserting “subject to section 624,”
after “(A)”.
(2)RELATION
TO STATE LAWS. – Section 625(b)(1) of the Fair Credit Reporting Act (15 U.S.C.
1681t(b)(1)), as so designated by subsection (a) of this section, is amended –
(A)by
striking “or” after the semicolon at the end of subparagraph (E); and
(B)by
adding at the end the following new subparagraph:
“(H)section
624, relating to the exchange and use of information to make a solicitation for
marketing purposes; or”.
(3)CROSS
REFERENCE CORRECTION. – Section 627(d) of the Fair Credit Reporting Act (15
U.S.C. 1681v(d)), as so designated by subsection (a) of this section, is
amended by striking “section 625” and inserting “section
626”.
(4)TABLE
OF SECTIONS. – The table of sections for title VI of the Consumer Credit
Protection Act (15 U.S.C. 1601 et seq.) is amended by striking the items relating
to sections 624 through 626 and inserting the following:
“624.
Affiliate sharing.
“625. Relation to State laws.
“626. Disclosures to FBI for counterintelligence purposes.
“627. Disclosures to governmental agencies for counterintelligence
purposes.”.
(e)STUDIES
OF INFORMATION SHARING PRACTICES. –
(1)IN
GENERAL. – The Federal banking agencies, the National Credit Union
Administration, and the Commission shall jointly conduct regular studies of the
consumer information sharing practices by financial institutions and other
persons that are creditors or users of consumer reports with their affiliates.
(2)MATTERS
FOR STUDY. – In conducting the studies required by paragraph (1), the agencies
described in paragraph (1) shall –
(A)identify

(i)the
purposes for which financial institutions and other creditors and users of
consumer reports share consumer information;
(ii)the
types of information shared by such entities with their affiliates;
(iii)the
number of choices provided to consumers with respect to the control of such
sharing, and the degree to and manner in which consumers exercise such choices,
if at all; and
(iv)whether
such entities share or may share personally identifiable transaction or
experience information with affiliates for purposes –
(I)that
are related to employment or hiring, including whether the person that is the
subject of such information is given notice of such sharing, and the specific
uses of such shared information; or
(II)of
general publication of such information; and
(B)specifically
examine the information sharing practices that financial institutions and other
creditors and users of consumer reports and their affiliates employ for the
purpose of making underwriting decisions or credit evaluations of consumers.
(3)REPORTS.

(A)INITIAL
REPORT. – Not later than 3 years after the date of enactment of this Act, the
Federal banking agencies, the National Credit Union Administration, and the
Commission shall jointly submit a report to the Congress on the results of the
initial study conducted in accordance with this subsection, together with any
recommendations for legislative or regulatory action.
(B)FOLLOWUP
REPORTS. – The Federal banking agencies, the National Credit Union
Administration, and the Commission shall, not less frequently than once every 3
years following the date of submission of the initial report under subparagraph
(A), jointly submit a report to the Congress that, together with any
recommendations for legislative or regulatory action –
(i)documents
any changes in the areas of study referred to in paragraph (2)(A) occurring
since the date of submission of the previous report;
(ii)identifies
any changes in the practices of financial institutions and other creditors and
users of consumer reports in sharing consumer information with their affiliates
for the purpose of making underwriting decisions or credit evaluations of
consumers occurring since the date of submission of the previous report; and
(iii)examines
the effects that changes described in clause (ii) have had, if any, on the
degree to which such affiliate sharing practices reduce the need for financial
institutions, creditors, and other users of consumer reports to rely on
consumer reports for such decisions.
SEC.
215. STUDY OF EFFECTS OF CREDIT SCORES AND CREDIT-BASED INSURANCE SCORES ON
AVAILABILITY AND AFFORDABILITY OF FINANCIAL PRODUCTS.
(a)STUDY
REQUIRED. – The Commission and the Board, in consultation with the Office of
Fair Housing and Equal Opportunity of the Department of Housing and Urban
Development, shall conduct a study of –
(1)the
effects of the use of credit scores and credit-based insurance scores on the
availability and affordability of financial products and services, including
credit cards, mortgages, auto loans, and property and casualty insurance;
(2)the
statistical relationship, utilizing a multivariate analysis that controls for
prohibited factors under the Equal Credit Opportunity Act and other known risk
factors, between credit scores and credit-based insurance scores and the
quantifiable risks and actual losses experienced by businesses;
(3)the
extent to which, if any, the use of credit scoring models, credit scores, and
credit-based insurance scores impact on the availability and affordability of
credit and insurance to the extent information is currently available or is
available through proxies, by geography, income, ethnicity, race, color,
religion, national origin, age, sex, marital status, and creed, including the
extent to which the consideration or lack of consideration of certain factors by
credit scoring systems could result in negative or differential treatment of
protected classes under the Equal Credit Opportunity Act, and the extent to
which, if any, the use of underwriting systems relying on these models could
achieve comparable results through the use of factors with less negative
impact; and
(4)the
extent to which credit scoring systems are used by businesses, the factors
considered by such systems, and the effects of variables which are not
considered by such systems.
(b)PUBLIC
PARTICIPATION. – The Commission shall seek public input about the prescribed
methodology and research design of the study described in subsection (a),
including from relevant Federal regulators, State insurance regulators,
community, civil rights, consumer, and housing groups.
(c)REPORT
REQUIRED. –
(1)IN
GENERAL. – Before the end of the 24-month period beginning on the date of
enactment of this Act, the Commission shall submit a detailed report on the
study conducted pursuant to subsection (a) to the Committee on Financial
Services of the House of Representatives and the Committee on Banking, Housing,
and Urban Affairs of the Senate.
(2)CONTENTS
OF REPORT. – The report submitted under paragraph (1) shall include the
findings and conclusions of the Commission, recommendations to address specific
areas of concerns addressed in the study, and recommendations for legislative
or administrative action that the Commission may determine to be necessary to
ensure that credit and creditbased insurance scores are used appropriately and
fairly to avoid negative effects.
SEC.
216. DISPOSAL OF CONSUMER REPORT INFORMATION AND RECORDS.
(a)IN
GENERAL. – The Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), as amended
by this Act, is amended by adding at the end the following:
Ҥ
628. Disposal of records
“(a)REGULATIONS.

“(1)IN
GENERAL. – Not later than 1 year after the date of enactment of this section,
the Federal banking agencies, the National Credit Union Administration, and the
Commission with respect to the entities that are subject to their respective
enforcement authority under section 621, and the Securities and Exchange
Commission, and in coordination as described in paragraph (2), shall issue
final regulations requiring any person that maintains or otherwise possesses
consumer information, or any compilation of consumer information, derived from
consumer reports for a business purpose to properly dispose of any such
information or compilation.
“(2)COORDINATION.
– Each agency required to prescribe regulations under paragraph (1) shall –
“(A)consult
and coordinate with each other such agency so that, to the extent possible, the
regulations prescribed by each such agency are consistent and comparable with
the regulations by each such other agency; and
“(B)ensure
that such regulations are consistent with the requirements and regulations
issued pursuant to Public Law 106–102 and other provisions of Federal law.
“(3)EXEMPTION
AUTHORITY. – In issuing regulations under this section, the Federal banking
agencies, the National Credit Union Administration, the Commission, and the
Securities and Exchange Commission may exempt any person or class of persons
from application of those regulations, as such agency deems appropriate to
carry out the purpose of this section.
“(b)RULE
OF CONSTRUCTION. – Nothing in this section shall be construed –
“(1)to
require a person to maintain or destroy any record pertaining to a consumer
that is not imposed under other law; or
“(2)to
alter or affect any requirement imposed under any other provision of law to
maintain or destroy such a record.”.
(b)CLERICAL
AMENDMENT. – The table of sections for title VI of the Consumer Credit
Protection Act (15 U.S.C. 1601 et seq.) is amended by inserting after the item
relating to section 627, as added by section 214 of this Act, the following:
“628.
Disposal of records.
“629. Corporate and technological circumvention prohibited.”.
SEC.
217. REQUIREMENT TO DISCLOSE COMMUNICATIONS TO A CONSUMER REPORTING AGENCY.
(a)IN
GENERAL. – Section 623(a) of the Fair Credit Reporting Act (15 U.S.C.
1681s–2(a)) as amended by this Act, is amended by inserting after paragraph
(6), the following new paragraph:
“(7)NEGATIVE
INFORMATION. –
“(A)NOTICE
TO CONSUMER REQUIRED. –
“(i)IN
GENERAL. – If any financial institution that extends credit and regularly and
in the ordinary course of business furnishes information to a consumer
reporting agency described in section 603(p) furnishes negative information to
such an agency regarding credit extended to a customer, the financial
institution shall provide a notice of such furnishing of negative information,
in writing, to the customer.
“(ii)NOTICE
EFFECTIVE FOR SUBSEQUENT SUBMISSIONS. – After providing such notice, the
financial institution may submit additional negative information to a consumer reporting
agency described in section 603(p) with respect to the same transaction,
extension of credit, account, or customer without providing additional notice
to the customer.
“(B)TIME
OF NOTICE. –
“(i)IN
GENERAL. – The notice required under subparagraph (A) shall be provided to the
customer prior to, or no later than 30 days after, furnishing the negative
information to a consumer reporting agency described in section 603(p).
“(ii)COORDINATION
WITH NEW ACCOUNT DISCLOSURES. – If the notice is provided to the customer prior
to furnishing the negative information to a consumer reporting agency, the
notice may not be included in the initial disclosures provided under section
127(a) of the Truth in Lending Act.
“(C)COORDINATION
WITH OTHER DISCLOSURES. – The notice required under subparagraph (A) –
“(i)may
be included on or with any notice of default, any billing statement, or any
other materials provided to the customer; and
“(ii)must
be clear and conspicuous.
“(D)MODEL
DISCLOSURE. –
“(i)DUTY
OF BOARD TO PREPARE. – The Board shall prescribe a brief model disclosure a
financial institution may use to comply with subparagraph (A), which shall not
exceed 30 words.
“(ii)USE
OF MODEL NOT REQUIRED. – No provision of this paragraph shall be construed as
requiring a financial institution to use any such model form prescribed by the
Board.
“(iii)COMPLIANCE
USING MODEL. – A financial institution shall be deemed to be in compliance with
subparagraph (A) if the financial institution uses any such model form
prescribed by the Board, or the financial institution uses any such model form
and rearranges its format.
“(E)USE
OF NOTICE WITHOUT SUBMITTING NEGATIVE INFORMATION. – No provision of this
paragraph shall be construed as requiring a financial institution that has
provided a customer with a notice described in subparagraph (A) to furnish
negative information about the customer to a consumer reporting agency.
“(F)SAFE
HARBOR. – A financial institution shall not be liable for failure to perform
the duties required by this paragraph if, at the time of the failure, the
financial institution maintained reasonable policies and procedures to comply
with this paragraph or the financial institution reasonably believed that the
institution is prohibited, by law, from contacting the consumer.
“(G)DEFINITIONS.
– For purposes of this paragraph, the following definitions shall apply:
“(i)NEGATIVE
INFORMATION. – The term ‘negative information’ means information concerning a
customer’s delinquencies, late payments, insolvency, or any form of default.
“(ii)CUSTOMER;
FINANCIAL INSTITUTION. – The terms ‘customer’ and ‘financial institution’ have
the same meanings as in section 509 Public Law 106–102.”.
(b)MODEL
DISCLOSURE FORM. – Before the end of the 6-month period beginning on the date
of enactment of this Act, the Board shall adopt the model disclosure required
under the amendment made by subsection (a) after notice duly given in the
Federal Register and an opportunity for public comment in accordance with
section 553 of title 5, United States Code.
TITLE
III – ENHANCING THE ACCURACY OF CONSUMER REPORT INFORMATION
SEC.
311. RISK-BASED PRICING NOTICE.
(a)DUTIES
OF USERS. – Section 615 of the Fair Credit Reporting Act (15 U.S.C. 1681m), as
amended by this Act, is amended by adding at the end the following:
“(h)DUTIES
OF USERS IN CERTAIN CREDIT TRANSACTIONS. –
“(1)IN
GENERAL. – Subject to rules prescribed as provided in paragraph (6), if any
person uses a consumer report in connection with an application for, or a
grant, extension, or other provision of, credit on material terms that are
materially less favorable than the most favorable terms available to a
substantial proportion of consumers from or through that person, based in whole
or in part on a consumer report, the person shall provide an oral, written, or
electronic notice to the consumer in the form and manner required by
regulations prescribed in accordance with this subsection.
“(2)TIMING.
– The notice required under paragraph (1) may be provided at the time of an
application for, or a grant, extension, or other provision of, credit or the
time of communication of an approval of an application for, or grant,
extension, or other provision of, credit, except as provided in the regulations
prescribed under paragraph (6).
“(3)EXCEPTIONS.
– No notice shall be required from a person under this subsection if –
“(A)the
consumer applied for specific material terms and was granted those terms,
unless those terms were initially specified by the person after the transaction
was initiated by the consumer and after the person obtained a consumer report;
or
“(B)the
person has provided or will provide a notice to the consumer under subsection
(a) in connection with the transaction.
“(4)OTHER
NOTICE NOT SUFFICIENT. – A person that is required to provide a notice under
subsection (a) cannot meet that requirement by providing a notice under this
subsection.
“(5)CONTENT
AND DELIVERY OF NOTICE. – A notice under this subsection shall, at a minimum –
“(A)include
a statement informing the consumer that the terms offered to the consumer are
set based on information from a consumer report;
“(B)identify
the consumer reporting agency furnishing the report;
“(C)include
a statement informing the consumer that the consumer may obtain a copy of a
consumer report from that consumer reporting agency without charge; and
“(D)include
the contact information specified by that consumer reporting agency for
obtaining such consumer reports (including a toll-free telephone number
established by the agency in the case of a consumer reporting agency described
in section 603(p)).
“(6)RULEMAKING.

“(A)RULES
REQUIRED. – The Commission and the Board shall jointly prescribe rules.
“(B)CONTENT.
– Rules required by subparagraph (A) shall address, but are not limited to –
“(i)the
form, content, time, and manner of delivery of any notice under this
subsection;
“(ii)clarification
of the meaning of terms used in this subsection, including what credit terms
are material, and when credit terms are materially less favorable;
“(iii)exceptions
to the notice requirement under this subsection for classes of persons or
transactions regarding which the agencies determine that notice would not
significantly benefit consumers;
“(iv)a
model notice that may be used to comply with this subsection; and
“(v)the
timing of the notice required under paragraph (1), including the circumstances
under which the notice must be provided after the terms offered to the consumer
were set based on information from a consumer report.
“(7)COMPLIANCE.
– A person shall not be liable for failure to perform the duties required by
this section if, at the time of the failure, the person maintained reasonable
policies and procedures to comply with this section.
“(8)ENFORCEMENT.

“(A)NO
CIVIL ACTIONS. – Sections 616 and 617 shall not apply to any failure by any
person to comply with this section.
“(B)ADMINISTRATIVE
ENFORCEMENT. – This section shall be enforced exclusively under section 621 by
the Federal agencies and officials identified in that section.”.
(b)RELATION
TO STATE LAWS. – Section 625(b)(1) of the Fair Credit Reporting Act (15 U.S.C.
1681t(b)(1)), as so designated by section 214 of this Act, is amended by adding
at the end the following:
“(I)section
615(h), relating to the duties of users of consumer reports to provide notice
with respect to terms in certain credit transactions;”.
SEC.
312. PROCEDURES TO ENHANCE THE ACCURACY AND INTEGRITY OF INFORMATION FURNISHED
TO CONSUMER REPORTING AGENCIES.
(a)ACCURACY
GUIDELINES AND REGULATIONS. – Section 623 of the Fair Credit Reporting Act (15
U.S.C. 1681s–2) is amended by adding at the end the following:
“(e)ACCURACY
GUIDELINES AND REGULATIONS REQUIRED. –
“(1)GUIDELINES.
– The Federal banking agencies, the National Credit Union Administration, and
the Commission shall, with respect to the entities that are subject to their
respective enforcement authority under section 621, and in coordination as
described in paragraph (2) –
“(A)establish
and maintain guidelines for use by each person that furnishes information to a
consumer reporting agency regarding the accuracy and integrity of the
information relating to consumers that such entities furnish to consumer
reporting agencies, and update such guidelines as often as necessary; and
“(B)prescribe
regulations requiring each person that furnishes information to a consumer
reporting agency to establish reasonable policies and procedures for
implementing the guidelines established pursuant to subparagraph (A).
“(2)COORDINATION.
– Each agency required to prescribe regulations under paragraph (1) shall consult
and coordinate with each other such agency so that, to the extent possible, the
regulations prescribed by each such entity are consistent and comparable with
the regulations prescribed by each other such agency.
“(3)CRITERIA.
– In developing the guidelines required by paragraph (1)(A), the agencies
described in paragraph (1) shall –
“(A)identify
patterns, practices, and specific forms of activity that can compromise the
accuracy and integrity of information furnished to consumer reporting agencies;
“(B)review
the methods (including technological means) used to furnish information
relating to consumers to consumer reporting agencies;
“(C)determine
whether persons that furnish information to consumer reporting agencies
maintain and enforce policies to assure the accuracy and integrity of
information furnished to consumer reporting agencies; and
“(D)examine
the policies and processes that persons that furnish information to consumer
reporting agencies employ to conduct reinvestigations and correct inaccurate
information relating to consumers that has been furnished to consumer reporting
agencies.”.
(b)DUTY
OF FURNISHERS TO PROVIDE ACCURATE INFORMATION. – Section 623(a)(1) of the Fair
Credit Reporting Act (15 U.S.C. 1681s–2(a)(1)) is amended –
(1)in
subparagraph (A), by striking “knows or consciously avoids knowing that
the information is inaccurate” and inserting “knows or has reasonable
cause to believe that the information is inaccurate”; and
(2)by
adding at the end the following:
“(D)DEFINITION.
– For purposes of subparagraph (A), the term ‘reasonable cause to believe that
the information is inaccurate’ means having specific knowledge, other than
solely allegations by the consumer, that would cause a reasonable person to
have substantial doubts about the accuracy of the information.”.
(c)ABILITY
OF CONSUMER TO DISPUTE INFORMATION DIRECTLY WITH FURNISHER. – Section 623(a) of
the Fair Credit Reporting Act (15 U.S.C. 1681s–2(a)), as amended by this Act,
is amended by adding at the end the following:
“(8)ABILITY
OF CONSUMER TO DISPUTE INFORMATION DIRECTLY WITH FURNISHER. –
“(A)IN
GENERAL. – The Federal banking agencies, the National Credit Union
Administration, and the Commission shall jointly prescribe regulations that
shall identify the circumstances under which a furnisher shall be required to
reinvestigate a dispute concerning the accuracy of information contained in a
consumer report on the consumer, based on a direct request of a consumer.
“(B)CONSIDERATIONS.
– In prescribing regulations under subparagraph (A), the agencies shall weigh –
“(i)the
benefits to consumers with the costs on furnishers and the credit reporting
system;
“(ii)the
impact on the overall accuracy and integrity of consumer reports of any such
requirements;
“(iii)whether
direct contact by the consumer with the furnisher would likely result in the
most expeditious resolution of any such dispute; and
“(iv)the
potential impact on the credit reporting process if credit repair
organizations, as defined in section 403(3), including entities that would be a
credit repair organization, but for section 403(3)(B)(i), are able to
circumvent the prohibition in subparagraph (G).
“(C)APPLICABILITY.
– Subparagraphs (D) through (G) shall apply in any circumstance identified
under the regulations promulgated under subparagraph (A).
“(D)SUBMITTING
A NOTICE OF DISPUTE. – A consumer who seeks to dispute the accuracy of
information shall provide a dispute notice directly to such person at the
address specified by the person for such notices that –
“(i)identifies
the specific information that is being disputed;
“(ii)explains
the basis for the dispute; and
“(iii)includes
all supporting documentation required by the furnisher to substantiate the
basis of the dispute.
“(E)DUTY
OF PERSON AFTER RECEIVING NOTICE OF DISPUTE. – After receiving a notice of
dispute from a consumer pursuant to subparagraph (D), the person that provided
the information in dispute to a consumer reporting agency shall –
“(i)conduct
an investigation with respect to the disputed information;
“(ii)review
all relevant information provided by the consumer with the notice;
“(iii)complete
such person’s investigation of the dispute and report the results of the
investigation to the consumer before the expiration of the period under section
611(a)(1) within which a consumer reporting agency would be required to
complete its action if the consumer had elected to dispute the information
under that section; and
“(iv)if
the investigation finds that the information reported was inaccurate, promptly
notify each consumer reporting agency to which the person furnished the
inaccurate information of that determination and provide to the agency any
correction to that information that is necessary to make the information
provided by the person accurate.
“(F)FRIVOLOUS
OR IRRELEVANT DISPUTE. –
“(i)IN
GENERAL. – This paragraph shall not apply if the person receiving a notice of a
dispute from a consumer reasonably determines that the dispute is frivolous or
irrelevant, including –
“(I)by
reason of the failure of a consumer to provide sufficient information to
investigate the disputed information; or
“(II)the
submission by a consumer of a dispute that is substantially the same as a
dispute previously submitted by or for the consumer, either directly to the
person or through a consumer reporting agency under subsection (b), with
respect to which the person has already performed the person’s duties under
this paragraph or subsection (b), as applicable.
“(ii)NOTICE
OF DETERMINATION. – Upon making any determination under clause (i) that a
dispute is frivolous or irrelevant, the person shall notify the consumer of
such determination not later than 5 business days after making such
determination, by mail or, if authorized by the consumer for that purpose, by
any other means available to the person.
“(iii)CONTENTS
OF NOTICE. – A notice under clause (ii) shall include –
“(I)the
reasons for the determination under clause (i); and
“(II)identification
of any information required to investigate the disputed information, which may
consist of a standardized form describing the general nature of such
information.
“(G)EXCLUSION
OF CREDIT REPAIR ORGANIZATIONS. – This paragraph shall not apply if the notice
of the dispute is submitted by, is prepared on behalf of the consumer by, or is
submitted on a form supplied to the consumer by, a credit repair organization,
as defined in section 403(3), or an entity that would be a credit repair
organization, but for section 403(3)(B)(i).”.
(d)FURNISHER
LIABILITY EXCEPTION. – Section 623(a)(5) of the Fair Credit Reporting Act (15
U.S.C. 1681s–2(a)(5)) is amended –
(1)by
striking “A person” and inserting the following:
“(A)IN
GENERAL. – A person”;
(2)by
inserting “date of delinquency on the account, which shall be the”
before “month”;
(3)by
inserting “on the account” before “that immediately
preceded”; and
(4)by
adding at the end the following:
“(B)RULE
OF CONSTRUCTION. – For purposes of this paragraph only, and provided that the
consumer does not dispute the information, a person that furnishes information
on a delinquent account that is placed for collection, charged for profit or
loss, or subjected to any similar action, complies with this paragraph, if –
“(i)the
person reports the same date of delinquency as that provided by the creditor to
which the account was owed at the time at which the commencement of the
delinquency occurred, if the creditor previously reported that date of
delinquency to a consumer reporting agency;
“(ii)the
creditor did not previously report the date of delinquency to a consumer reporting
agency, and the person establishes and follows reasonable procedures to obtain
the date of delinquency from the creditor or another reliable source and
reports that date to a consumer reporting agency as the date of delinquency; or
“(iii)the
creditor did not previously report the date of delinquency to a consumer
reporting agency and the date of delinquency cannot be reasonably obtained as
provided in clause (ii), the person establishes and follows reasonable
procedures to ensure the date reported as the date of delinquency precedes the
date on which the account is placed for collection, charged to profit or loss,
or subjected to any similar action, and reports such date to the credit
reporting agency.”.
(e)LIABILITY
AND ENFORCEMENT. –
(1)CIVIL
LIABILITY. – Section 623 of the Fair Credit Reporting Act (15 U.S.C. 1681s–2)
is amended by striking subsections (c) and (d) and inserting the following:
“(c)LIMITATION
ON LIABILITY. – Except as provided in section 621(c)(1)(B), sections 616 and
617 do not apply to any violation of –
“(1)subsection
(a) of this section, including any regulations issued thereunder;
“(2)subsection
(e) of this section, except that nothing in this paragraph shall limit, expand,
or otherwise affect liability under section 616 or 617, as applicable, for
violations of subsection (b) of this section; or
“(3)subsection
(e) of section 615.
“(d)LIMITATION
ON ENFORCEMENT. – The provisions of law described in paragraphs (1) through (3)
of subsection (c) (other than with respect to the exception described in
paragraph (2) of subsection (c)) shall be enforced exclusively as provided
under section 621 by the Federal agencies and officials and the State officials
identified in section 621.”.
(2)STATE
ACTIONS. – Section 621(c) of the Fair Credit Reporting Act (15 U.S.C. 1681s(c))
is amended –
(A)in
paragraph (1)(B)(ii), by striking “of section 623(a)” and inserting
“described in any of paragraphs (1) through (3) of section 623(c)”;
and
(B)in
paragraph (5) –
(i)in
each of subparagraphs (A) and (B), by striking “of section 623(a)(1)”
each place that term appears and inserting “described in any of paragraphs
(1) through (3) of section 623(c)”; and
(ii)by
amending the paragraph heading to read as follows:
“(5)LIMITATIONS
ON STATE ACTIONS FOR CERTAIN VIOLATIONS. – “.
(f)RULE
OF CONSTRUCTION. – Nothing in this section, the amendments made by this
section, or any other provision of this Act shall be construed to affect any
liability under section 616 or 617 of the Fair Credit Reporting Act (15 U.S.C.
1681n, 1681o) that existed on the day before the date of enactment of this Act.
SEC.
313. FTC AND CONSUMER REPORTING AGENCY ACTION CONCERNING COMPLAINTS.
(a)IN
GENERAL. – Section 611 of the Fair Credit Reporting Act (15 U.S.C. 1681i) is
amended by adding at the end the following:
“(e)TREATMENT
OF COMPLAINTS AND REPORT TO CONGRESS. –
“(1)IN
GENERAL. – The Commission shall –
“(A)compile
all complaints that it receives that a file of a consumer that is maintained by
a consumer reporting agency described in section 603(p) contains incomplete or
inaccurate information, with respect to which, the consumer appears to have
disputed the completeness or accuracy with the consumer reporting agency or
otherwise utilized the procedures provided by subsection (a); and
“(B)transmit
each such complaint to each consumer reporting agency involved.
“(2)EXCLUSION.
– Complaints received or obtained by the Commission pursuant to its
investigative authority under the Federal Trade Commission Act shall not be
subject to paragraph (1).
“(3)AGENCY
RESPONSIBILITIES. – Each consumer reporting agency described in section 603(p)
that receives a complaint transmitted by the Commission pursuant to paragraph
(1) shall –
“(A)review
each such complaint to determine whether all legal obligations imposed on the
consumer reporting agency under this title (including any obligation imposed by
an applicable court or administrative order) have been met with respect to the
subject matter of the complaint;
“(B)provide
reports on a regular basis to the Commission regarding the determinations of
and actions taken by the consumer reporting agency, if any, in connection with
its review of such complaints; and
“(C)maintain,
for a reasonable time period, records regarding the disposition of each such
complaint that is sufficient to demonstrate compliance with this subsection.
“(4)RULEMAKING
AUTHORITY. – The Commission may prescribe regulations, as appropriate to
implement this subsection.
“(5)ANNUAL
REPORT. – The Commission shall submit to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial Services of the
House of Representatives an annual report regarding information gathered by the
Commission under this subsection.”.
(b)PROMPT
INVESTIGATION OF DISPUTED CONSUMER INFORMATION. –
(1)STUDY
REQUIRED. – The Board and the Commission shall jointly study the extent to
which, and the manner in which, consumer reporting agencies and furnishers of
consumer information to consumer reporting agencies are complying with the
procedures, time lines, and requirements under the Fair Credit Reporting Act
for the prompt investigation of the disputed accuracy of any consumer
information, the completeness of the information provided to consumer reporting
agencies, and the prompt correction or deletion, in accordance with such Act,
of any inaccurate or incomplete information or information that cannot be
verified.
(2)REPORT
REQUIRED. – Before the end of the 12-month period beginning on the date of
enactment of this Act, the Board and the Commission shall jointly submit a
progress report to the Congress on the results of the study required under
paragraph (1).
(3)CONSIDERATIONS.
– In preparing the report required under paragraph (2), the Board and the
Commission shall consider information relating to complaints compiled by the
Commission under section 611(e) of the Fair Credit Reporting Act, as added by
this section.
(4)RECOMMENDATIONS.
– The report required under paragraph (2) shall include such recommendations as
the Board and the Commission jointly determine to be appropriate for
legislative or administrative action, to ensure that –
(A)consumer
disputes with consumer reporting agencies over the accuracy or completeness of
information in a consumer’s file are promptly and fully investigated and any
incorrect, incomplete, or unverifiable information is corrected or deleted
immediately thereafter;
(B)furnishers
of information to consumer reporting agencies maintain full and prompt
compliance with the duties and responsibilities established under section 623 of
the Fair Credit Reporting Act; and
(C)consumer
reporting agencies establish and maintain appropriate internal controls and
management review procedures for maintaining full and continuous compliance
with the procedures, time lines, and requirements under the Fair Credit
Reporting Act for the prompt investigation of the disputed accuracy of any
consumer information and the prompt correction or deletion, in accordance with
such Act, of any inaccurate or incomplete information or information that
cannot be verified.
SEC.
314. IMPROVED DISCLOSURE OF THE RESULTS OF REINVESTIGATION.
(a)IN
GENERAL. – Section 611(a)(5)(A) of the Fair Credit Reporting Act (15 U.S.C.
1681i(a)(5)(A)) is amended by striking “shall” and all that follows
through the end of the subparagraph, and inserting the following: “shall –
“(i)promptly
delete that item of information from the file of the consumer, or modify that
item of information, as appropriate, based on the results of the
reinvestigation; and
“(ii)promptly
notify the furnisher of that information that the information has been modified
or deleted from the file of the consumer.”.
(b)FURNISHER
REQUIREMENTS RELATING TO INACCURATE, INCOMPLETE, OR UNVERIFIABLE INFORMATION. –
Section 623(b)(1) of the Fair Credit Reporting Act (15 U.S.C. 1681s–2(b)(1)) is
amended –
(1)in
subparagraph (C), by striking “and” at the end; and
(2)in
subparagraph (D), by striking the period at the end and inserting the
following: “; and
“(E)if
an item of information disputed by a consumer is found to be inaccurate or
incomplete or cannot be verified after any reinvestigation under paragraph (1),
for purposes of reporting to a consumer reporting agency only, as appropriate,
based on the results of the reinvestigation promptly –
“(i)modify
that item of information;
“(ii)delete
that item of information; or
“(iii)permanently
block the reporting of that item of information.”.
SEC.
315. RECONCILING ADDRESSES.
Section
605 of the Fair Credit Reporting Act (15 U.S.C. 1681c), as amended by this Act,
is amended by adding at the end the following:
“(h)NOTICE
OF DISCREPANCY IN ADDRESS. –
“(1)IN
GENERAL. – If a person has requested a consumer report relating to a consumer
from a consumer reporting agency described in section 603(p), the request
includes an address for the consumer that substantially differs from the
addresses in the file of the consumer, and the agency provides a consumer
report in response to the request, the consumer reporting agency shall notify
the requester of the existence of the discrepancy.
“(2)REGULATIONS.

“(A)REGULATIONS
REQUIRED. – The Federal banking agencies, the National Credit Union
Administration, and the Commission shall jointly, with respect to the entities
that are subject to their respective enforcement authority under section 621,
prescribe regulations providing guidance regarding reasonable policies and
procedures that a user of a consumer report should employ when such user has
received a notice of discrepancy under paragraph (1).
“(B)POLICIES
AND PROCEDURES TO BE INCLUDED. – The regulations prescribed under subparagraph
(A) shall describe reasonable policies and procedures for use by a user of a
consumer report –
“(i)to
form a reasonable belief that the user knows the identity of the person to whom
the consumer report pertains; and
“(ii)if
the user establishes a continuing relationship with the consumer, and the user
regularly and in the ordinary course of business furnishes information to the
consumer reporting agency from which the notice of discrepancy pertaining to
the consumer was obtained, to reconcile the address of the consumer with the
consumer reporting agency by furnishing such address to such consumer reporting
agency as part of information regularly furnished by the user for the period in
which the relationship is established.”.
SEC.
316. NOTICE OF DISPUTE THROUGH RESELLER.
(a)REQUIREMENT
FOR REINVESTIGATION OF DISPUTED INFORMATION UPON NOTICE FROM A RESELLER. –
Section 611(a) of the Fair Credit Reporting Act (15 U.S.C. 1681i(a)(1)(A)) is
amended –
(1)in
paragraph (1)(A) –
(A)by
striking “If the completeness” and inserting “Subject to
subsection (f), if the completeness”;
(B)by
inserting “, or indirectly through a reseller,” after “notifies
the agency directly”; and
(C)by
inserting “or reseller” before the period at the end;
(2)in
paragraph (2)(A) –
(A)by
inserting “or a reseller” after “dispute from any
consumer”; and
(B)by
inserting “or reseller” before the period at the end; and
(3)in
paragraph (2)(B), by inserting “or the reseller” after “from the
consumer”.
(b)REINVESTIGATION
REQUIREMENT APPLICABLE TO RESELLERS. – Section 611 of the Fair Credit Reporting
Act (15 U.S.C. 1681i), as amended by this Act, is amended by adding at the end
the following:
“(f)REINVESTIGATION
REQUIREMENT APPLICABLE TO RESELLERS. –
“(1)EXEMPTION
FROM GENERAL REINVESTIGATION REQUIREMENT. – Except as provided in paragraph
(2), a reseller shall be exempt from the requirements of this section.
“(2)ACTION
REQUIRED UPON RECEIVING NOTICE OF A DISPUTE. – If a reseller receives a notice
from a consumer of a dispute concerning the completeness or accuracy of any
item of information contained in a consumer report on such consumer produced by
the reseller, the reseller shall, within 5 business days of receiving the
notice, and free of charge –
“(A)determine
whether the item of information is incomplete or inaccurate as a result of an
act or omission of the reseller; and
“(B)if

“(i)the
reseller determines that the item of information is incomplete or inaccurate as
a result of an act or omission of the reseller, not later than 20 days after
receiving the notice, correct the information in the consumer report or delete
it; or
“(ii)if
the reseller determines that the item of information is not incomplete or
inaccurate as a result of an act or omission of the reseller, convey the notice
of the dispute, together with all relevant information provided by the
consumer, to each consumer reporting agency that provided the reseller with the
information that is the subject of the dispute, using an address or a
notification mechanism specified by the consumer reporting agency for such
notices.
“(3)RESPONSIBILITY
OF CONSUMER REPORTING AGENCY TO NOTIFY CONSUMER THROUGH RESELLER. – Upon the
completion of a reinvestigation under this section of a dispute concerning the
completeness or accuracy of any information in the file of a consumer by a
consumer reporting agency that received notice of the dispute from a reseller
under paragraph (2) –
“(A)the
notice by the consumer reporting agency under paragraph (6), (7), or (8) of
subsection (a) shall be provided to the reseller in lieu of the consumer; and
“(B)the
reseller shall immediately reconvey such notice to the consumer, including any
notice of a deletion by telephone in the manner required under paragraph
(8)(A).
“(4)RESELLER
REINVESTIGATIONS. – No provision of this subsection shall be construed as
prohibiting a reseller from conducting a reinvestigation of a consumer dispute
directly.”.
(c)TECHNICAL
AND CONFORMING AMENDMENT. – Section 611(a)(2)(B) of the Fair Credit Reporting
Act (15 U.S.C. 1681i(a)(2)(B)) is amended in the subparagraph heading, by
striking “FROM CONSUMER”.
SEC.
317. REASONABLE REINVESTIGATION REQUIRED.
Section
611(a)(1)(A) of the Fair Credit Reporting Act (15 U.S.C. 1681i(a)(1)(A)) is
amended by striking “shall reinvestigate free of charge” and
inserting “shall, free of charge, conduct a reasonable reinvestigation to
determine whether the disputed information is inaccurate”.
SEC.
318. FTC STUDY OF ISSUES RELATING TO THE FAIR CREDIT REPORTING ACT.
(a)STUDY
REQUIRED. –
(1)IN
GENERAL. – The Commission shall conduct a study on ways to improve the
operation of the Fair Credit Reporting Act.
(2)AREAS
FOR STUDY. – In conducting the study under paragraph (1), the Commission shall
review –
(A)the
efficacy of increasing the number of points of identifying information that a
credit reporting agency is required to match to ensure that a consumer is the
correct individual to whom a consumer report relates before releasing a
consumer report to a user, including –
(i)the
extent to which requiring additional points of such identifying information to
match would –
(I)enhance
the accuracy of credit reports; and
(II)combat
the provision of incorrect consumer reports to users;
(ii)the
extent to which requiring an exact match of the first and last name, social
security number, and address and ZIP Code of the consumer would enhance the
likelihood of increasing credit report accuracy; and
(iii)the
effects of allowing consumer reporting agencies to use partial matches of
social security numbers and name recognition software on the accuracy of credit
reports;
(B)requiring
notification to consumers when negative information has been added to their
credit reports, including –
(i)the
potential impact of such notification on the ability of consumers to identify
errors on their credit reports; and
(ii)the
potential impact of such notification on the ability of consumers to remove
fraudulent information from their credit reports;
(C)the
effects of requiring that a consumer who has experienced an adverse action
based on a credit report receives a copy of the same credit report that the
creditor relied on in taking the adverse action, including –
(i)the
extent to which providing such reports to consumers would increase the ability
of consumers to identify errors in their credit reports; and
(ii)the
extent to which providing such reports to consumers would increase the ability
of consumers to remove fraudulent information from their credit reports;
(D)any
common financial transactions that are not generally reported to the consumer
reporting agencies, but would provide useful information in determining the
credit worthiness of consumers; and
(E)any
actions that might be taken within a voluntary reporting system to encourage
the reporting of the types of transactions described in subparagraph (D).
(3)COSTS
AND BENEFITS. – With respect to each area of study described in paragraph (2),
the Commission shall consider the extent to which such requirements would
benefit consumers, balanced against the cost of implementing such provisions.
(b)REPORT
REQUIRED. – Not later than 1 year after the date of enactment of this Act, the
chairman of the Commission shall submit a report to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives containing a detailed summary of the
findings and conclusions of the study under this section, together with such
recommendations for legislative or administrative actions as may be
appropriate.
SEC.
319. FTC STUDY OF THE ACCURACY OF CONSUMER REPORTS.
(a)STUDY
REQUIRED. – Until the final report is submitted under subsection (b)(2), the
Commission shall conduct an ongoing study of the accuracy and completeness of
information contained in consumer reports prepared or maintained by consumer
reporting agencies and methods for improving the accuracy and completeness of
such information.
(b)BIENNIAL
REPORTS REQUIRED. –
(1)INTERIM
REPORTS. – The Commission shall submit an interim report to the Congress on the
study conducted under subsection (a) at the end of the 1-year period beginning
on the date of enactment of this Act and biennially thereafter for 8 years.
(2)FINAL
REPORT. – The Commission shall submit a final report to the Congress on the
study conducted under subsection (a) at the end of the 2-year period beginning
on the date on which the final interim report is submitted to the Congress
under paragraph (1).
(3)CONTENTS.
– Each report submitted under this subsection shall contain a detailed summary
of the findings and conclusions of the Commission with respect to the study
required under subsection (a) and such recommendations for legislative and
administrative action as the Commission may determine to be appropriate.
TITLE
IV – LIMITING THE USE AND SHARING OF MEDICAL INFORMATION IN THE FINANCIAL
SYSTEM
SEC.
411. PROTECTION OF MEDICAL INFORMATION IN THE FINANCIAL SYSTEM.
(a)IN
GENERAL. – Section 604(g) of the Fair Credit Reporting Act (15 U.S.C. 1681b(g))
is amended to read as follows:
“(g)PROTECTION
OF MEDICAL INFORMATION. –
“(1)LIMITATION
ON CONSUMER REPORTING AGENCIES. – A consumer reporting agency shall not furnish
for employment purposes, or in connection with a credit or insurance
transaction, a consumer report that contains medical information about a
consumer, unless –
“(A)if
furnished in connection with an insurance transaction, the consumer
affirmatively consents to the furnishing of the report;
“(B)if
furnished for employment purposes or in connection with a credit transaction –
“(i)the
information to be furnished is relevant to process or effect the employment or
credit transaction; and
“(ii)the
consumer provides specific written consent for the furnishing of the report
that describes in clear and conspicuous language the use for which the
information will be furnished; or
“(C)the
information to be furnished pertains solely to transactions, accounts, or
balances relating to debts arising from the receipt of medical services,
products, or devises, where such information, other than account status or
amounts, is restricted or reported using codes that do not identify, or do not
provide information sufficient to infer, the specific provider or the nature of
such services, products, or devices, as provided in section 605(a)(6).
“(2)LIMITATION
ON CREDITORS. – Except as permitted pursuant to paragraph (3)(C) or regulations
prescribed under paragraph (5)(A), a creditor shall not obtain or use medical
information pertaining to a consumer in connection with any determination of
the consumer’s eligibility, or continued eligibility, for credit.
“(3)ACTIONS
AUTHORIZED BY FEDERAL LAW, INSURANCE ACTIVITIES AND REGULATORY DETERMINATIONS.
– Section 603(d)(3) shall not be construed so as to treat information or any
communication of information as a consumer report if the information or
communication is disclosed –
“(A)in
connection with the business of insurance or annuities, including the
activities described in section 18B of the model Privacy of Consumer Financial
and Health Information Regulation issued by the National Association of
Insurance Commissioners (as in effect on January 1, 2003);
“(B)for
any purpose permitted without authorization under the Standards for
Individually Identifiable Health Information promulgated by the Department of
Health and Human Services pursuant to the Health Insurance Portability and
Accountability Act of 1996, or referred to under section 1179 of such Act, or
described in section 502(e) of Public Law 106–102; or
“(C)as
otherwise determined to be necessary and appropriate, by regulation or order and
subject to paragraph (6), by the Commission, any Federal banking agency or the
National Credit Union Administration (with respect to any financial institution
subject to the jurisdiction of such agency or Administration under paragraph
(1), (2), or (3) of section 621(b), or the applicable State insurance authority
(with respect to any person engaged in providing insurance or annuities).
“(4)LIMITATION
ON REDISCLOSURE OF MEDICAL INFORMATION. – Any person that receives medical
information pursuant to paragraph (1) or (3) shall not disclose such
information to any other person, except as necessary to carry out the purpose
for which the information was initially disclosed, or as otherwise permitted by
statute, regulation, or order.
“(5)REGULATIONS
AND EFFECTIVE DATE FOR PARAGRAPH (2). –
“(A)REGULATIONS
REQUIRED. – Each Federal banking agency and the National Credit Union
Administration shall, subject to paragraph (6) and after notice and opportunity
for comment, prescribe regulations that permit transactions under paragraph (2)
that are determined to be necessary and appropriate to protect legitimate
operational, transactional, risk, consumer, and other needs (and which shall
include permitting actions necessary for administrative verification purposes),
consistent with the intent of paragraph (2) to restrict the use of medical
information for inappropriate purposes.
“(B)FINAL
REGULATIONS REQUIRED. – The Federal banking agencies and the National Credit
Union Administration shall issue the regulations required under subparagraph
(A) in final form before the end of the 6-month period beginning on the date of
enactment of the Fair and Accurate Credit Transactions Act of 2003.
“(6)COORDINATION
WITH OTHER LAWS. – No provision of this subsection shall be construed as altering,
affecting, or superseding the applicability of any other provision of Federal
law relating to medical confidentiality.”.
(b)RESTRICTION
ON SHARING OF MEDICAL INFORMATION. – Section 603(d) of the Fair Credit
Reporting Act (15 U.S.C. 1681a(d)) is amended –
(1)in
paragraph (2), by striking “The term” and inserting “Except as
provided in paragraph (3), the term”; and
(2)by
adding at the end the following new paragraph:
“(3)RESTRICTION
ON SHARING OF MEDICAL INFORMATION. – Except for information or any communication
of information disclosed as provided in section 604(g)(3), the exclusions in
paragraph (2) shall not apply with respect to information disclosed to any
person related by common ownership or affiliated by corporate control, if the
information is –
“(A)medical
information;
“(B)an
individualized list or description based on the payment transactions of the
consumer for medical products or services; or
“(C)an
aggregate list of identified consumers based on payment transactions for
medical products or services.”.
(c)DEFINITION.
– Section 603(i) of the Fair Credit Reporting Act (15 U.S.C. 1681a(i)) is
amended to read as follows:
“(i)MEDICAL
INFORMATION. – The term ‘medical information’ –
“(1)means
information or data, whether oral or recorded, in any form or medium, created
by or derived from a health care provider or the consumer, that relates to –
“(A)the
past, present, or future physical, mental, or behavioral health or condition of
an individual;
“(B)the
provision of health care to an individual; or
“(C)the
payment for the provision of health care to an individual.
“(2)does
not include the age or gender of a consumer, demographic information about the
consumer, including a consumer’s residence address or e-mail address, or any
other information about a consumer that does not relate to the physical,
mental, or behavioral health or condition of a consumer, including the
existence or value of any insurance policy.”.
(d)EFFECTIVE
DATES. – This section shall take effect at the end of the 180-day period beginning
on the date of enactment of this Act, except that paragraph (2) of section
604(g) of the Fair Credit Reporting Act (as amended by subsection (a) of this
section) shall take effect on the later of –
(1)the
end of the 90-day period beginning on the date on which the regulations
required under paragraph (5)(B) of such section 604(g) are issued in final
form; or
(2)the
date specified in the regulations referred to in paragraph (1).
SEC.
412. CONFIDENTIALITY OF MEDICAL CONTACT INFORMATION IN CONSUMER REPORTS.
(a)DUTIES
OF MEDICAL INFORMATION FURNISHERS. – Section 623(a) of the Fair Credit
Reporting Act (15 U.S.C. 1681s–2(a)), as amended by this Act, is amended by
adding at the end the following:
“(9)DUTY
TO PROVIDE NOTICE OF STATUS AS MEDICAL INFORMATION FURNISHER. – A person whose
primary business is providing medical services, products, or devices, or the
person’s agent or assignee, who furnishes information to a consumer reporting
agency on a consumer shall be considered a medical information furnisher for
purposes of this title, and shall notify the agency of such status.”.
(b)RESTRICTION
OF DISSEMINATION OF MEDICAL CONTACT INFORMATION. – Section 605(a) of the Fair
Credit Reporting Act (15 U.S.C. 1681c(a)) is amended by adding at the end the
following:
“(6)The
name, address, and telephone number of any medical information furnisher that
has notified the agency of its status, unless –
“(A)such
name, address, and telephone number are restricted or reported using codes that
do not identify, or provide information sufficient to infer, the specific
provider or the nature of such services, products, or devices to a person other
than the consumer; or
“(B)the
report is being provided to an insurance company for a purpose relating to
engaging in the business of insurance other than property and casualty
insurance.”.
(c)NO
EXCEPTIONS ALLOWED FOR DOLLAR AMOUNTS. – Section 605(b) of the Fair Credit
Reporting Act (15 U.S.C. 1681c(b)) is amended by striking “The provisions
of subsection (a)” and inserting “The provisions of paragraphs (1)
through (5) of subsection (a)”.
(d)COORDINATION
WITH OTHER LAWS. – No provision of any amendment made by this section shall be
construed as altering, affecting, or superseding the applicability of any other
provision of Federal law relating to medical confidentiality.
(e)FTC
REGULATION OF CODING OF TRADE NAMES. – Section 621 of the Fair Credit Reporting
Act (15 U.S.C. 1681s), as amended by this Act, is amended by adding at the end
the following:
“(g)FTC
REGULATION OF CODING OF TRADE NAMES. – If the Commission determines that a
person described in paragraph (9) of section 623(a) has not met the
requirements of such paragraph, the Commission shall take action to ensure the
person’s compliance with such paragraph, which may include issuing model
guidance or prescribing reasonable policies and procedures, as necessary to
ensure that such person complies with such paragraph.”.
(f)TECHNICAL
AND CONFORMING AMENDMENTS. – Section 604(g) of the Fair Credit Reporting Act
(15 U.S.C. 1681b(g)), as amended by section 411 of this Act, is amended –
(1)in
paragraph (1), by inserting “(other than medical contact information
treated in the manner required under section 605(a)(6))” after “a
consumer report that contains medical information”; and
(2)in
paragraph (2), by inserting “(other than medical information treated in
the manner required under section 605(a)(6))” after “a creditor shall
not obtain or use medical information”.
(g)EFFECTIVE
DATE. – The amendments made by this section shall take effect at the end of the
15-month period beginning on the date of enactment of this Act.
TITLE
V – FINANCIAL LITERACY AND EDUCATION IMPROVEMENT
SEC.
511. SHORT TITLE.
This
title may be cited as the “Financial Literacy and Education Improvement
Act”.
SEC.
512. DEFINITIONS.
As
used in this title –
(1)the
term “Chairperson” means the Chairperson of the Financial Literacy
and Education Commission; and
(2)the
term “Commission” means the Financial Literacy and Education
Commission established under section 513.
SEC.
513. ESTABLISHMENT OF FINANCIAL LITERACY AND EDUCATION COMMISSION.
(a)IN
GENERAL. – There is established a commission to be known as the “Financial
Literacy and Education Commission”.
(b)PURPOSE.
– The Commission shall serve to improve the financial literacy and education of
persons in the United States through development of a national strategy to
promote financial literacy and education.
(c)MEMBERSHIP.

(1)COMPOSITION.
– The Commission shall be composed of –
(A)the
Secretary of the Treasury;
(B)the
respective head of each of the Federal banking agencies (as defined in section
3 of the Federal Deposit Insurance Act), the National Credit Union
Administration, the Securities and Exchange Commission, each of the Departments
of Education, Agriculture, Defense, Health and Human Services, Housing and
Urban Development, Labor, and Veterans Affairs, the Federal Trade Commission,
the General Services Administration, the Small Business Administration, the
Social Security Administration, the Commodity Futures Trading Commission, and
the Office of Personnel Management; and
(C)at
the discretion of the President, not more than 5 individuals appointed by the
President from among the administrative heads of any other Federal agencies,
departments, or other Federal Government entities, whom the President
determines to be engaged in a serious effort to improve financial literacy and
education.
(2)ALTERNATES.
– Each member of the Commission may designate an alternate if the member is
unable to attend a meeting of the Commission. Such alternate shall be an
individual who exercises significant decision making authority.
(d)CHAIRPERSON.
– The Secretary of the Treasury shall serve as the Chairperson.
(e)MEETINGS.
– The Commission shall hold, at the call of the Chairperson, at least 1 meeting
every 4 months. All such meetings shall be open to the public. The Commission
may hold, at the call of the Chairperson, such other meetings as the
Chairperson sees fit to carry out this title.
(f)QUORUM.
– A majority of the members of the Commission shall constitute a quorum, but a
lesser number of members may hold hearings.
(g)INITIAL
MEETING. – The Commission shall hold its first meeting not later than 60 days
after the date of enactment of this Act.
SEC.
514. DUTIES OF THE COMMISSION.
(a)DUTIES.

(1)IN
GENERAL. – The Commission, through the authority of the members referred to in
section 513(c), shall take such actions as it deems necessary to streamline,
improve, or augment the financial literacy and education programs, grants, and
materials of the Federal Government, including curricula for all Americans.
(2)AREAS
OF EMPHASIS. – To improve financial literacy and education, the Commission
shall emphasize, among other elements, basic personal income and household
money management and planning skills, including how to –
(A)create
household budgets, initiate savings plans, and make strategic investment
decisions for education, retirement, home ownership, wealth building, or other
savings goals;
(B)manage
spending, credit, and debt, including credit card debt, effectively;
(C)increase
awareness of the availability and significance of credit reports and credit
scores in obtaining credit, the importance of their accuracy (and how to
correct inaccuracies), their effect on credit terms, and the effect common
financial decisions may have on credit scores;
(D)ascertain
fair and favorable credit terms;
(E)avoid
abusive, predatory, or deceptive credit offers and financial products;
(F)understand,
evaluate, and compare financial products, services, and opportunities;
(G)understand
resources that ought to be easily accessible and affordable, and that inform
and educate investors as to their rights and avenues of recourse when an
investor believes his or her rights have been violated by unprofessional
conduct of market intermediaries;
(H)increase
awareness of the particular financial needs and financial transactions (such as
the sending of remittances) of consumers who are targeted in multilingual
financial literacy and education programs and improve the development and distribution
of multilingual financial literacy and education materials;
(I)promote
bringing individuals who lack basic banking services into the financial
mainstream by opening and maintaining an account with a financial institution;
and
(J)improve
financial literacy and education through all other related skills, including
personal finance and related economic education, with the primary goal of
programs not simply to improve knowledge, but rather to improve consumers’
financial choices and outcomes.
(b)WEBSITE.

(1)IN
GENERAL. – The Commission shall establish and maintain a website, such as the
domain name “FinancialLiteracy.gov”, or a similar domain name.
(2)PURPOSES.
– The website established under paragraph (1) shall –
(A)serve
as a clearinghouse of information about Federal financial literacy and
education programs;
(B)provide
a coordinated entry point for accessing information about all Federal
publications, grants, and materials promoting enhanced financial literacy and
education;
(C)offer
information on all Federal grants to promote financial literacy and education,
and on how to target, apply for, and receive a grant that is most appropriate
under the circumstances;
(D)as
the Commission considers appropriate, feature website links to efforts that
have no commercial content and that feature information about financial
literacy and education programs, materials, or campaigns; and
(E)offer
such other information as the Commission finds appropriate to share with the
public in the fulfillment of its purpose.
(c)TOLL-FREE
HOTLINE. – The Commission shall establish a toll-free telephone number that
shall be made available to members of the public seeking information about
issues pertaining to financial literacy and education.
(d)DEVELOPMENT
AND DISSEMINATION OF MATERIALS. – The Commission shall –
(1)develop
materials to promote financial literacy and education; and
(2)disseminate
such materials to the general public.
(e)COORDINATION
OF EFFORTS. – The Commission shall take such steps as are necessary to
coordinate and promote financial literacy and education efforts at the State
and local level, including promoting partnerships among Federal, State, and
local governments, nonprofit organizations, and private enterprises.
(f)NATIONAL
STRATEGY. –
(1)IN
GENERAL. – The Commission shall –
(A)not
later than 18 months after the date of enactment of this Act, develop a
national strategy to promote basic financial literacy and education among all
American consumers; and
(B)coordinate Federal
efforts to implement the str
ategy
developed under subparagraph (A).
(2)STRATEGY.
– The strategy to promote basic financial literacy and education required to be
developed under paragraph (1) shall provide for –
(A)participation
by State and local governments and private, nonprofit, and public institutions
in the creation and implementation of such strategy;
(B)the
development of methods –
(i)to
increase the general financial education level of current and future consumers
of financial services and products; and
(ii)to
enhance the general understanding of financial services and products;
(C)review
of Federal activities designed to promote financial literacy and education, and
development of a plan to improve coordination of such activities; and
(D)the
identification of areas of overlap and duplication among Federal financial
literacy and education activities and proposed means of eliminating any such
overlap and duplication.
(3)NATIONAL
STRATEGY REVIEW. – The Commission shall, not less than annually, review the
national strategy developed under this subsection and make such changes and
recommendations as it deems necessary.
(g)CONSULTATION.
– The Commission shall actively consult with a variety of representatives from
private and nonprofit organizations and State and local agencies, as determined
appropriate by the Commission.
(h)REPORTS.

(1)IN
GENERAL. – Not later than 18 months after the date of the first meeting of the
Commission, and annually thereafter, the Commission shall issue a report, the
Strategy for Assuring Financial Empowerment (“SAFE Strategy”), to the
Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives on the progress
of the Commission in carrying out this title.
(2)CONTENTS.
– The report required under paragraph (1) shall include –
(A)the
national strategy for financial literacy and education, as described under
subsection (f);
(B)information
concerning the implementation of the duties of the Commission under subsections
(a) through (g);
(C)an
assessment of the success of the Commission in implementing the national
strategy developed under subsection (f);
(D)an
assessment of the availability, utilization, and impact of Federal financial
literacy and education materials;
(E)information
concerning the content and public use of –
(i)the
website established under subsection (b); and
(ii)the
toll-free telephone number established under subsection (c);
(F)a
brief survey of the financial literacy and education materials developed under
subsection (d), and data regarding the dissemination and impact of such
materials, as measured by improved financial decision making;
(G)a
brief summary of any hearings conducted by the Commission, including a list of
witnesses who testified at such hearings;
(H)information
about the activities of the Commission planned for the next fiscal year;
(I)a
summary of all Federal financial literacy and education activities targeted to
communities that have historically lacked access to financial literacy
materials and education, and have been underserved by the mainstream financial
systems; and
(J)such
other materials relating to the duties of the Commission as the Commission
deems appropriate.
(3)INITIAL
REPORT. – The initial report under paragraph (1) shall include information
regarding all Federal programs, materials, and grants which seek to improve
financial literacy, and assess the effectiveness of such programs.
(i)TESTIMONY.
– The Commission shall annually provide testimony by the Chairperson to the
Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives.
SEC.
515. POWERS OF THE COMMISSION.
(a)HEARINGS.

(1)IN
GENERAL. – The Commission shall hold such hearings, sit and act at such times
and places, take such testimony, and receive such evidence as the Commission
deems appropriate to carry out this title.
(2)PARTICIPATION.
– In hearings held under this subsection, the Commission shall consider
inviting witnesses from, among other groups –
(A)other
Federal Government officials;
(B)State
and local government officials;
(C)consumer
and community groups;
(D)nonprofit
financial literacy and education groups (such as those involved in personal
finance and economic education); and
(E)the
financial services industry.
(b)INFORMATION
FROM FEDERAL AGENCIES. – The Commission may secure directly from any Federal
department or agency such information as the Commission considers necessary to
carry out this title. Upon request of the Chairperson, the head of such department
or agency shall furnish such information to the Commission.
(c)PERIODIC
STUDIES. – The Commission may conduct periodic studies regarding the state of
financial literacy and education in the United States, as the Commission
determines appropriate.
(d)MULTILINGUAL.
– The Commission may take any action to develop and promote financial literacy
and education materials in languages other than English, as the Commission
deems appropriate, including for the website established under section 514(b),
at the toll-free number established under section 514(c), and in the materials
developed and disseminated under section 514(d).
SEC.
516. COMMISSION PERSONNEL MATTERS.
(a)COMPENSATION
OF MEMBERS. – Each member of the Commission shall serve without compensation in
addition to that received for their service as an officer or employee of the
United States.
(b)TRAVEL
EXPENSES. – The members of the Commission shall be allowed travel expenses,
including per diem in lieu of subsistence, at rates authorized for employees of
agencies under subchapter I of chapter 57 of title 5, United States Code, while
away from their homes or regular places of business in the performance of
services for the Commission.
(c)ASSISTANCE.

(1)IN
GENERAL. – The Director of the Office of Financial Education of the Department
of the Treasury shall provide assistance to the Commission, upon request of the
Commission, without reimbursement.
(2)DETAIL
OF GOVERNMENT EMPLOYEES. – Any Federal Government employee may be detailed to
the Commission without reimbursement, and such detail shall be without
interruption or loss of civil service status or privilege.
SEC.
517. STUDIES BY THE COMPTROLLER GENERAL.
(a)EFFECTIVENESS
STUDY. – Not later than 3 years after the date of enactment of this Act, the
Comptroller General of the United States shall submit a report to Congress
assessing the effectiveness of the Commission in promoting financial literacy
and education.
(b)STUDY
AND REPORT ON THE NEED AND MEANS FOR IMPROVING FINANCIAL LITERACY AMONG
CONSUMERS. –
(1)STUDY
REQUIRED. – The Comptroller General of the United States shall conduct a study
to assess the extent of consumers’ knowledge and awareness of credit reports,
credit scores, and the dispute resolution process, and on methods for improving
financial literacy among consumers.
(2)FACTORS
TO BE INCLUDED. – The study required under paragraph (1) shall include the
following issues:
(A)The
number of consumers who view their credit reports.
(B)Under
what conditions and for what purposes do consumers primarily obtain a copy of
their consumer report (such as for the purpose of ensuring the completeness and
accuracy of the contents, to protect against fraud, in response to an adverse
action based on the report, or in response to suspected identity theft) and
approximately what percentage of the total number of consumers who obtain a
copy of their consumer report do so for each such primary purpose.
(C)The
extent of consumers’ knowledge of the data collection process.
(D)The
extent to which consumers know how to get a copy of a consumer report.
(E)The
extent to which consumers know and understand the factors that positively or
negatively impact credit scores.
(3)REPORT
REQUIRED. – Before the end of the 12-month period beginning on the date of
enactment of this Act, the Comptroller General shall submit a report to
Congress on the findings and conclusions of the Comptroller General pursuant to
the study conducted under this subsection, together with such recommendations
for legislative or administrative action as the Comptroller General may
determine to be appropriate, including recommendations on methods for improving
financial literacy among consumers.
SEC.
518. THE NATIONAL PUBLIC SERVICE MULTIMEDIA CAMPAIGN TO ENHANCE THE STATE OF
FINANCIAL LITERACY.
(a)IN
GENERAL. – The Secretary of the Treasury (in this section referred to as the
“Secretary”), after review of the recommendations of the Commission,
as part of the national strategy, shall develop, implement, and conduct a pilot
national public service multimedia campaign to enhance the state of financial
literacy and education in the United States.
(b)PROGRAM
REQUIREMENTS. –
(1)PUBLIC
SERVICE CAMPAIGN. – The Secretary, after review of the recommendations of the
Commission, shall select and work with a nonprofit organization or
organizations that are especially well-qualified in the distribution of public
service campaigns, and have secured private sector funds to produce the pilot
national public service multimedia campaign.
(2)DEVELOPMENT
OF MULTIMEDIA CAMPAIGN. – The Secretary, after review of the recommendations of
the Commission, shall develop, in consultation with nonprofit, public, or
private organizations, especially those that are well qualified by virtue of
their experience in the field of financial literacy and education, to develop
the financial literacy national public service multimedia campaign.
(3)FOCUS
OF CAMPAIGN. – The pilot national public service multimedia campaign shall be
consistent with the national strategy, and shall promote the toll-free
telephone number and the website developed under this title.
(c)MULTILINGUAL.
– The Secretary may develop the multimedia campaign in languages other than
English, as the Secretary deems appropriate.
(d)PERFORMANCE
MEASURES. – The Secretary shall develop measures to evaluate the effectiveness
of the pilot national public service multimedia campaign, as measured by
improved financial decision making among individuals.
(e)REPORT.
– For each fiscal year for which there are appropriations pursuant to the
authorization in subsection (e), the Secretary shall submit a report to the
Committee on Banking, Housing, and Urban Affairs and the Committee on
Appropriations of the Senate and the Committee on Financial Services and the
Committee on Appropriations of the House of Representatives, describing the
status and implementation of the provisions of this section and the state of
financial literacy and education in the United States.
(f)AUTHORIZATION
OF APPROPRIATIONS. – There are authorized to be appropriated to the Secretary,
not to exceed $3,000,000 for fiscal years 2004, 2005, and 2006, for the
development, production, and distribution of a pilot national public service
multimedia campaign under this section.
SEC.
519. AUTHORIZATION OF APPROPRIATIONS.
There
are authorized to be appropriated to the Commission such sums as may be
necessary to carry out this title, including administrative expenses of the
Commission.
TITLE
VI – PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS
SEC.
611. CERTAIN EMPLOYEE INVESTIGATION COMMUNICATIONS EXCLUDED FROM DEFINITION OF
CONSUMER REPORT.
(a)IN
GENERAL. – Section 603 of the Fair Credit Reporting Act (15 U.S.C. 1681a), as
amended by this Act is amended by adding at the end the following:
“(x)EXCLUSION
OF CERTAIN COMMUNICATIONS FOR EMPLOYEE INVESTIGATIONS. –
“(1)COMMUNICATIONS
DESCRIBED IN THIS SUBSECTION. – A communication is described in this subsection
if –
“(A)but
for subsection (d)(2)(D), the communication would be a consumer report;
“(B)the
communication is made to an employer in connection with an investigation of –
“(i)suspected
misconduct relating to employment; or
“(ii)compliance
with Federal, State, or local laws and regulations, the rules of a
self-regulatory organization, or any preexisting written policies of the
employer;
“(C)the
communication is not made for the purpose of investigating a consumer’s credit
worthiness, credit standing, or credit capacity; and
“(D)the
communication is not provided to any person except –
“(i)to
the employer or an agent of the employer;
“(ii)to
any Federal or State officer, agency, or department, or any officer, agency, or
department of a unit of general local government;
“(iii)to
any self-regulatory organization with regulatory authority over the activities
of the employer or employee;
“(iv)as
otherwise required by law; or
“(v)pursuant
to section 608.
“(2)SUBSEQUENT
DISCLOSURE. – After taking any adverse action based in whole or in part on a
communication described in paragraph (1), the employer shall disclose to the
consumer a summary containing the nature and substance of the communication
upon which the adverse action is based, except that the sources of information
acquired solely for use in preparing what would be but for subsection (d)(2)(D)
an investigative consumer report need not be disclosed.
“(3)SELF-REGULATORY
ORGANIZATION DEFINED. – For purposes of this subsection, the term
‘self-regulatory organization’ includes any self-regulatory organization (as
defined in section 3(a)(26) of the Securities Exchange Act of 1934), any entity
established under title I of the Sarbanes-Oxley Act of 2002, any board of trade
designated by the Commodity Futures Trading Commission, and any futures
association registered with such Commission.”.
(b)TECHNICAL
AND CONFORMING AMENDMENT. – Section 603(d)(2)(D) of the Fair Credit Reporting
Act (15 U.S.C. 1681a(d)(2)(D)) is amended by inserting “or (x)” after
“subsection (o)”.
TITLE
VII – RELATION TO STATE LAWS
SEC.
711. RELATION TO STATE LAWS.
Section
625 of the Fair Credit Reporting Act (15 U.S.C. 1681t), as so designated by section
214 of this Act, is amended –
(1)in
subsection (a), by inserting “or for the prevention or mitigation of
identity theft,” after “information on consumers,”;
(2)in
subsection (b), by adding at the end the following:
“(5)with
respect to the conduct required by the specific provisions of –
“(A)section
605(g);
“(B)section
605A;
“(C)section
605B;
“(D)section
609(a)(1)(A);
“(E)section
612(a);
“(F)subsections
(e), (f), and (g) of section 615;
“(G)section
621(f);
“(H)section
623(a)(6); or
“(I)section
628.”; and
(3)in
subsection (d) –
(A)by
striking paragraph (2);
(B)by
striking “(c) – ” and all that follows through “do not
affect” and inserting “(c) do not affect”; and
(C)by
striking “1996; and” and inserting “1996.”.
TITLE
VIII – MISCELLANEOUS
SEC.
811. CLERICAL AMENDMENTS.
(a)SHORT
TITLE. – Section 601 of the Fair Credit Reporting Act (15 U.S.C. 1601 note) is
amended by striking “the Fair Credit Reporting Act.” and inserting
“the ‘Fair Credit Reporting Act’.”.
(b)SECTION
604. – Section 604(a) of the Fair Credit Reporting Act (15 U.S.C. 1681b(a)) is
amended in paragraphs (1) through (5), other than subparagraphs (E) and (F) of
paragraph (3), by moving each margin 2 ems to the right.
(c)SECTION
605. –
(1)Section
605(a)(1) of the Fair Credit Reporting Act (15 U.S.C. 1681c(a)(1)) is amended
by striking “(1) cases” and inserting “(1) Cases”.
(2)
(A)Section
5(1) of Public Law 105–347 (112 Stat. 3211) is amended by striking
“Judgments which” and inserting “judgments which”.
(B)The
amendment made by subparagraph (A) shall be deemed to have the same effective
date as section 5(1) of Public Law 105–347 (112 Stat. 3211).
(d)SECTION
609. – Section 609(a) of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)) is
amended –
(1)in
paragraph (2), by moving the margin 2 ems to the right; and
(2)in
paragraph (3)(C), by moving the margins 2 ems to the left.
(e)SECTION
617. – Section 617(a)(1) of the Fair Credit Reporting Act (15 U.S.C.
1681o(a)(1)) is amended by adding “and” at the end.
(f)SECTION
621. – Section 621(b)(1)(B) of the Fair Credit Reporting Act (15 U.S.C.
1681s(b)(1)(B)) is amended by striking “25(a)” and inserting
“25A”.
(g)TITLE
31. – Section 5318 of title 31, United States Code, is amended by redesignating
the second item designated as subsection (l) (relating to applicability of
rules) as subsection (m).
(h)CONFORMING
AMENDMENT. – Section 2411(c) of Public Law 104–208 (110 Stat. 3009–445) is
repealed.
LEGISLATIVE
HISTORY – H.R. 2622 (S. 1753):
House
Reports:Nos. 108–263 and Pt.2 (Comm. on Financial Services) and 108– 396 (Comm.
of Conference).
Senate
Reports:No. 108–166 accompanying S. 1753 (Comm. on Banking, Housing, and Urban
Affairs).
CONGRESSIONAL RECORD, Vol. 149 (2003):
Sept.
10, considered and passed House.
Nov.
5, considered and passed Senate, amended, in lieu of S. 1753.
Nov.
21, House agreed to conference report.
Nov.
22, Senate agreed to conference report.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS,
Vol. 39 (2003):
Dec.
4, Presidential remarks.
The Fair Debt Collection
Practices Act
TABLE
OF CONTENTS
801Short title802Congressional
findings and declaration of purpose803Definitions804Acquisition of
location information805Communication in
connection with debt collection806Harassment or abuse807False or misleading
representations808Unfair practice809Validation of debts810Multiple debts811Legal actions by debt
collectors812Furnishing certain
deceptive forms813Civil liability814Administrative
enforcement815Reports to Congress
by the Commission816Relation to State
laws817Exemption for State
regulation818Effective date
801.
Short title [15 USC 1601 note]
This
title may be cited as the “Fair Debt Collection Practices Act.”
802.
Congressional findings and declarations of purpose [15
USC 1692]
(a)There
is abundant evidence of the use of abusive, deceptive, and unfair debt
collection practices by many debt collectors. Abusive debt collection practices
contribute to the number of personal bankruptcies, to marital instability, to
the loss of jobs, and to invasions of individual privacy.
(b)Existing
laws and procedures for redressing these injuries are inadequate to protect
consumers.
(c)Means
other than misrepresentation or other abusive debt collection practices are
available for the effective collection of debts.
(d)Abusive
debt collection practices are carried on to a substantial extent in interstate
commerce and through means and instrumentalities of such commerce. Even where
abusive debt collection practices are purely intrastate in character, they
nevertheless directly affect interstate commerce.
(e)It
is the purpose of this title to eliminate abusive debt collection practices by
debt collectors, to insure that those debt collectors who refrain from using
abusive debt collection practices are not competitively disadvantaged, and to
promote consistent State action to protect consumers against debt collection
abuses.
803.
Definitions [15 USC 1692a]
As
used in this title —
(1)The
term “Commission” means the Federal Trade Commission.
(2)The
term “communication” means the conveying of information regarding a
debt directly or indirectly to any person through any medium.
(3)The
term “consumer” means any natural person obligated or allegedly
obligated to pay any debt.
(4)The
term “creditor” means any person who offers or extends credit
creating a debt or to whom a debt is owed, but such term does not include any
person to the extent that he receives an assignment or transfer of a debt in
default solely for the purpose of facilitating collection of such debt for
another.
(5)The
term “debt” means any obligation or alleged obligation of a consumer
to pay money arising out of a transaction in which the money, property,
insurance or services which are the subject of the transaction are primarily
for personal, family, or household purposes, whether or not such obligation has
been reduced to judgment.
(6)The
term “debt collector” means any person who uses any instrumentality
of interstate commerce or the mails in any business the principal purpose of
which is the collection of any debts, or who regularly collects or attempts to
collect, directly or indirectly, debts owed or due or asserted to be owed or
due another. Notwithstanding the exclusion provided by clause (F) of the last
sentence of this paragraph, the term includes any creditor who, in the process
of collecting his own debts, uses any name other than his own which would indicate
that a third person is collecting or attempting to collect such debts. For the
purpose of section 808(6), such term also includes any person who uses any
instrumentality of interstate commerce or the mails in any business the
principal purpose of which is the enforcement of security interests. The term
does not include —
(A)any
officer or employee of a creditor while, in the name of the creditor,
collecting debts for such creditor;
(B)any
person while acting as a debt collector for another person, both of whom are
related by common ownership or affiliated by corporate control, if the person
acting as a debt collector does so only for persons to whom it is so related or
affiliated and if the principal business of such person is not the collection
of debts;
(C)any
officer or employee of the United States or any State to the extent that
collecting or attempting to collect any debt is in the performance of his
official duties;
(D)any
person while serving or attempting to serve legal process on any other person
in connection with the judicial enforcement of any debt;
(E)any
nonprofit organization which, at the request of consumers, performs bona fide
consumer credit counseling and assists consumers in the liquidation of their
debts by receiving payments from such consumers and distributing such amounts
to creditors; and
(F)any
person collecting or attempting to collect any debt owed or due or asserted to
be owed or due another to the extent such activity (i) is incidental to a bona
fide fiduciary obligation or a bona fide escrow arrangement; (ii) concerns a
debt which was originated by such person; (iii) concerns a debt which was not
in default at the time it was obtained by such person; or (iv) concerns a debt
obtained by such person as a secured party in a commercial credit transaction
involving the creditor.
(7)The
term “location information” means a consumer’s place of abode and his
telephone number at such place, or his place of employment.
(8)The
term “State” means any State, territory, or possession of the United
States, the District of Columbia, the Commonwealth of Puerto Rico, or any
political subdivision of any of the foregoing.
804.
Acquisition of location information [15 USC 1692b]
Any
debt collector communicating with any person other than the consumer for the
purpose of acquiring location information about the consumer shall —
(1)identify
himself, state that he is confirming or correcting location information
concerning the consumer, and, only if expressly requested, identify his
employer;
(2)not
state that such consumer owes any debt;
(3)not
communicate with any such person more than once unless requested to do so by
such person or unless the debt collector reasonably believes that the earlier
response of such person is erroneous or incomplete and that such person now has
correct or complete location information;
(4)not
communicate by post card;
(5)not
use any language or symbol on any envelope or in the contents of any
communication effected by the mails or telegram that indicates that the debt
collector is in the debt collection business or that the communication relates
to the collection of a debt; and
(6)after
the debt collector knows the consumer is represented by an attorney with regard
to the subject debt and has knowledge of, or can readily ascertain, such
attorney’s name and address, not communicate with any person other than that
attorney, unless the attorney fails to respond within a reasonable period of
time to the communication from the debt collector.
805.
Communication in connection with debt collection [15
USC 1692c]
(a)COMMUNICATION
WITH THE CONSUMER GENERALLY. Without the prior consent of the consumer given
directly to the debt collector or the express permission of a court of
competent jurisdiction, a debt collector may not communicate with a consumer in
connection with the collection of any debt —
(1)at
any unusual time or place or a time or place known or which should be known to
be inconvenient to the consumer. In the absence of knowledge of circumstances
to the contrary, a debt collector shall assume that the convenient time for
communicating with a consumer is after 8 o’clock antimeridian and before 9
o’clock postmeridian, local time at the consumer’s location;
(2)if
the debt collector knows the consumer is represented by an attorney with
respect to such debt and has knowledge of, or can readily ascertain, such
attorney’s name and address, unless the attorney fails to respond within a
reasonable period of time to a communication from the debt collector or unless
the attorney consents to direct communication with the consumer; or
(3)at
the consumer’s place of employment if the debt collector knows or has reason to
know that the consumer’s employer prohibits the consumer from receiving such
communication.
(b)COMMUNICATION
WITH THIRD PARTIES. Except as provided in section 804, without the prior
consent of the consumer given directly to the debt collector, or the express
permission of a court of competent jurisdiction, or as reasonably necessary to
effectuate a postjudgment judicial remedy, a debt collector may not
communicate, in connection with the collection of any debt, with any person
other than a consumer, his attorney, a consumer reporting agency if otherwise
permitted by law, the creditor, the attorney of the creditor, or the attorney
of the debt collector.
(c)CEASING
COMMUNICATION. If a consumer notifies a debt collector in writing that the
consumer refuses to pay a debt or that the consumer wishes the debt collector
to cease further communication with the consumer, the debt collector shall not
communicate further with the consumer with respect to such debt, except —
(1)to
advise the consumer that the debt collector’s further efforts are being
terminated;
(2)to
notify the consumer that the debt collector or creditor may invoke specified
remedies which are ordinarily invoked by such debt collector or creditor; or
(3)where
applicable, to notify the consumer that the debt collector or creditor intends
to invoke a specified remedy.
If
such notice from the consumer is made by mail, notification shall be complete
upon receipt.
(d)For
the purpose of this section, the term “consumer” includes the
consumer’s spouse, parent (if the consumer is a minor), guardian, executor, or
administrator.
806.
Harassment or abuse [15 USC 1692d]
A
debt collector may not engage in any conduct the natural consequence of which
is to harass, oppress, or abuse any person in connection with the collection of
a debt. Without limiting the general application of the foregoing, the
following conduct is a violation of this section:
(1)The
use or threat of use of violence or other criminal means to harm the physical
person, reputation, or property of any person.
(2)The
use of obscene or profane language or language the natural consequence of which
is to abuse the hearer or reader.
(3)The
publication of a list of consumers who allegedly refuse to pay debts, except to
a consumer reporting agency or to persons meeting the requirements of section
603(f) or 604(3)1 of
this Act.
(4)The
advertisement for sale of any debt to coerce payment of the debt.
(5)Causing
a telephone to ring or engaging any person in telephone conversation repeatedly
or continuously with intent to annoy, abuse, or harass any person at the called
number.
(6)Except
as provided in section 804, the placement of telephone calls without meaningful
disclosure of the caller’s identity.
807.
False or misleading representations [15 USC 1692e]
A
debt collector may not use any false, deceptive, or misleading representation
or means in connection with the collection of any debt. Without limiting the
general application of the foregoing, the following conduct is a violation of
this section:
(1)The
false representation or implication that the debt collector is vouched for,
bonded by, or affiliated with the United States or any State, including the use
of any badge, uniform, or facsimile thereof.
(2)The
false representation of —
(A)the
character, amount, or legal status of any debt; or
(B)any
services rendered or compensation which may be lawfully received by any debt
collector for the collection of a debt.
(3)The
false representation or implication that any individual is an attorney or that
any communication is from an attorney.
(4)The
representation or implication that nonpayment of any debt will result in the
arrest or imprisonment of any person or the seizure, garnishment, attachment,
or sale of any property or wages of any person unless such action is lawful and
the debt collector or creditor intends to take such action.
(5)The
threat to take any action that cannot legally be taken or that is not intended
to be taken.
(6)The
false representation or implication that a sale, referral, or other transfer of
any interest in a debt shall cause the consumer to —
(A)lose
any claim or defense to payment of the debt; or
(B)become
subject to any practice prohibited by this title.
(7)The
false representation or implication that the consumer committed any crime or
other conduct in order to disgrace the consumer.
(8)Communicating
or threatening to communicate to any person credit information which is known
or which should be known to be false, including the failure to communicate that
a disputed debt is disputed.
(9)The
use or distribution of any written communication which simulates or is falsely
represented to be a document authorized, issued, or approved by any court,
official, or agency of the United States or any State, or which creates a false
impression as to its source, authorization, or approval.
(10)The
use of any false representation or deceptive means to collect or attempt to
collect any debt or to obtain information concerning a consumer.
(11)The
failure to disclose in the initial written communication with the consumer and,
in addition, if the initial communication with the consumer is oral, in that
initial oral communication, that the debt collector is attempting to collect a
debt and that any information obtained will be used for that purpose, and the
failure to disclose in subsequent communications that the communication is from
a debt collector, except that this paragraph shall not apply to a formal
pleading made in connection with a legal action.
(12)The
false representation or implication that accounts have been turned over to
innocent purchasers for value.
(13)The
false representation or implication that documents are legal process.
(14)The
use of any business, company, or organization name other than the true name of
the debt collector’s business, company, or organization.
(15)The
false representation or implication that documents are not legal process forms
or do not require action by the consumer.
(16)The
false representation or implication that a debt collector operates or is
employed by a consumer reporting agency as defined by section 603(f) of this
Act.
808.
Unfair practices [15 USC 1692f]
A
debt collector may not use unfair or unconscionable means to collect or attempt
to collect any debt. Without limiting the general application of the foregoing,
the following conduct is a violation of this section:
(1)The
collection of any amount (including any interest, fee, charge, or expense
incidental to the principal obligation) unless such amount is expressly
authorized by the agreement creating the debt or permitted by law.
(2)The
acceptance by a debt collector from any person of a check or other payment
instrument postdated by more than five days unless such person is notified in
writing of the debt collector’s intent to deposit such check or instrument not
more than ten nor less than three business days prior to such deposit.
(3)The
solicitation by a debt collector of any postdated check or other postdated
payment instrument for the purpose of threatening or instituting criminal
prosecution.
(4)Depositing
or threatening to deposit any postdated check or other postdated payment
instrument prior to the date on such check or instrument.
(5)Causing
charges to be made to any person for communications by concealment of the true
propose of the communication. Such charges include, but are not limited to,
collect telephone calls and telegram fees.
(6)Taking
or threatening to take any nonjudicial action to effect dispossession or
disablement of property if —
(A)there
is no present right to possession of the property claimed as collateral through
an enforceable security interest;
(B)there
is no present intention to take possession of the property; or
(C)the
property is exempt by law from such dispossession or disablement.
(7)Communicating
with a consumer regarding a debt by post card.
(8)Using
any language or symbol, other than the debt collector’s address, on any
envelope when communicating with a consumer by use of the mails or by telegram,
except that a debt collector may use his business name if such name does not
indicate that he is in the debt collection business.
809.
Validation of debts [15 USC 1692g]
(a)Within
five days after the initial communication with a consumer in connection with
the collection of any debt, a debt collector shall, unless the following
information is contained in the initial communication or the consumer has paid
the debt, send the consumer a written notice containing —
(1)the
amount of the debt;
(2)the
name of the creditor to whom the debt is owed;
(3)a
statement that unless the consumer, within thirty days after receipt of the
notice, disputes the validity of the debt, or any portion thereof, the debt
will be assumed to be valid by the debt collector;
(4)a
statement that if the consumer notifies the debt collector in writing within
the thirty-day period that the debt, or any portion thereof, is disputed, the
debt collector will obtain verification of the debt or a copy of a judgment
against the consumer and a copy of such verification or judgment will be mailed
to the consumer by the debt collector; and
(5)a
statement that, upon the consumer’s written request within the thirty-day
period, the debt collector will provide the consumer with the name and address
of the original creditor, if different from the current creditor.
(b)If
the consumer notifies the debt collector in writing within the thirty-day
period described in subsection (a) that the debt, or any portion thereof, is
disputed, or that the consumer requests the name and address of the original
creditor, the debt collector shall cease collection of the debt, or any disputed
portion thereof, until the debt collector obtains verification of the debt or
any copy of a judgment, or the name and address of the original creditor, and a
copy of such verification or judgment, or name and address of the original
creditor, is mailed to the consumer by the debt collector.
(c)The
failure of a consumer to dispute the validity of a debt under this section may
not be construed by any court as an admission of liability by the consumer.
810.
Multiple debts [15 USC 1692h]
If
any consumer owes multiple debts and makes any single payment to any debt
collector with respect to such debts, such debt collector may not apply such
payment to any debt which is disputed by the consumer and, where applicable,
shall apply such payment in accordance with the consumer’s directions.
811.
Legal actions by debt collectors [15 USC 1692i]
(a)Any
debt collector who brings any legal action on a debt against any consumer shall

(1)in
the case of an action to enforce an interest in real property securing the
consumer’s obligation, bring such action only in a judicial district or similar
legal entity in which such real property is located; or
(2)in
the case of an action not described in paragraph (1), bring such action only in
the judicial district or similar legal entity —
(A)in
which such consumer signed the contract sued upon; or
(B)in
which such consumer resides at the commencement of the action.
(b)Nothing
in this title shall be construed to authorize the bringing of legal actions by
debt collectors.
812.
Furnishing certain deceptive forms [15 USC 1692j]
(a)It
is unlawful to design, compile, and furnish any form knowing that such form
would be used to create the false belief in a consumer that a person other than
the creditor of such consumer is participating in the collection of or in an
attempt to collect a debt such consumer allegedly owes such creditor, when in
fact such person is not so participating.
(b)Any
person who violates this section shall be liable to the same extent and in the
same manner as a debt collector is liable under section 813 for failure to
comply with a provision of this title.
813.
Civil liability [15 USC 1692k]
(a)Except
as otherwise provided by this section, any debt collector who fails to comply
with any provision of this title with respect to any person is liable to such
person in an amount equal to the sum of —
(1)any
actual damage sustained by such person as a result of such failure;
(2)(A)
in the case of any action by an individual, such additional damages as the
court may allow, but not exceeding $1,000; or (B) in the case of a class
action, (i) such amount for each named plaintiff as could be recovered under
subparagraph (A), and (ii) such amount as the court may allow for all other
class members, without regard to a minimum individual recovery, not to exceed
the lesser of $500,000 or 1 per centum of the net worth of the debt collector;
and
(3)in
the case of any successful action to enforce the foregoing liability, the costs
of the action, together with a reasonable attorney’s fee as determined by the
court. On a finding by the court that an action under this section was brought
in bad faith and for the purpose of harassment, the court may award to the
defendant attorney’s fees reasonable in relation to the work expended and
costs.
(b)In
determining the amount of liability in any action under subsection (a), the
court shall consider, among other relevant factors —
(1)in
any individual action under subsection (a)(2)(A), the frequency and persistence
of noncompliance by the debt collector, the nature of such noncompliance, and
the extent to which such noncompliance was intentional; or
(2)in
any class action under subsection (a)(2)(B), the frequency and persistence of
noncompliance by the debt collector, the nature of such noncompliance, the
resources of the debt collector, the number of persons adversely affected, and
the extent to which the debt collector’s noncompliance was intentional.
(c)A
debt collector may not be held liable in any action brought under this title if
the debt collector shows by a preponderance of evidence that the violation was
not intentional and resulted from a bona fide error notwithstanding the
maintenance of procedures reasonably adapted to avoid any such error.
(d)An
action to enforce any liability created by this title may be brought in any
appropriate United States district court without regard to the amount in
controversy, or in any other court of competent jurisdiction, within one year
from the date on which the violation occurs.
(e)No
provision of this section imposing any liability shall apply to any act done or
omitted in good faith in conformity with any advisory opinion of the
Commission, notwithstanding that after such act or omission has occurred, such
opinion is amended, rescinded, or determined by judicial or other authority to
be invalid for any reason.
814.
Administrative enforcement [15 USC 1692l]
(a)Compliance
with this title shall be enforced by the Commission, except to the extend that
enforcement of the requirements imposed under this title is specifically
committed to another agency under subsection (b). For purpose of the exercise
by the Commission of its functions and powers under the Federal Trade
Commission Act, a violation of this title shall be deemed an unfair or
deceptive act or practice in violation of that Act. All of the functions and
powers of the Commission under the Federal Trade Commission Act are available
to the Commission to enforce compliance by any person with this title,
irrespective of whether that person is engaged in commerce or meets any other
jurisdictional tests in the Federal Trade Commission Act, including the power
to enforce the provisions of this title in the same manner as if the violation
had been a violation of a Federal Trade Commission trade regulation rule.
(b)Compliance
with any requirements imposed under this title shall be enforced under —
(1)section
8 of the Federal Deposit Insurance Act, in the case of —
(A)national
banks, by the Comptroller of the Currency;
(B)member
banks of the Federal Reserve System (other than national banks), by the Federal
Reserve Board; and
(C)banks
the deposits or accounts of which are insured by the Federal Deposit Insurance
Corporation (other than members of the Federal Reserve System), by the Board of
Directors of the Federal Deposit Insurance Corporation;
(2)section
5(d) of the Home Owners Loan Act of 1933, section 407 of the National Housing
Act, and sections 6(i) and 17 of the Federal Home Loan Bank Act, by the Federal
Home Loan Bank Board (acting directing or through the Federal Savings and Loan
Insurance Corporation), in the case of any institution subject to any of those
provisions;
(3)the
Federal Credit Union Act, by the Administrator of the National Credit Union
Administration with respect to any Federal credit union;
(4)subtitle
IV of Title 49, by the Interstate Commerce Commission with respect to any
common carrier subject to such subtitle;
(5)the
Federal Aviation Act of 1958, by the Secretary of Transportation with respect
to any air carrier or any foreign air carrier subject to that Act; and
(6)the
Packers and Stockyards Act, 1921 (except as provided in section 406 of that
Act), by the Secretary of Agriculture with respect to any activities subject to
that Act.
(c)For
the purpose of the exercise by any agency referred to in subsection (b) of its
powers under any Act referred to in that subsection, a violation of any
requirement imposed under this title shall be deemed to be a violation of a
requirement imposed under that Act. In addition to its powers under any provision
of law specifically referred to in subsection (b), each of the agencies
referred to in that subsection may exercise, for the purpose of enforcing
compliance with any requirement imposed under this title any other authority
conferred on it by law, except as provided in subsection (d).
(d)(d)
Neither the Commission nor any other agency referred to in subsection (b) may
promulgate trade regulation rules or other regulations with respect to the
collection of debts by debt collectors as defined in this title.
815.
Reports to Congress by the Commission [15 USC 1692m]
(a)Not
later than one year after the effective date of this title and at one-year
intervals thereafter, the Commission shall make reports to the Congress
concerning the administration of its functions under this title, including such
recommendations as the Commission deems necessary or appropriate. In addition,
each report of the Commission shall include its assessment of the extent to
which compliance with this title is being achieved and a summary of the
enforcement actions taken by the Commission under section 814 of this title.
(b)In
the exercise of its functions under this title, the Commission may obtain upon
request the views of any other Federal agency which exercises enforcement
functions under section 814 of this title.
816.
Relation to State laws [15 USC 1692n]
This
title does not annul, alter, or affect, or exempt any person subject to the
provisions of this title from complying with the laws of any State with respect
to debt collection practices, except to the extent that those laws are
inconsistent with any provision of this title, and then only to the extent of
the inconsistency. For purposes of this section, a State law is not
inconsistent with this title if the protection such law affords any consumer is
greater than the protection provided by this title.
817.
Exemption for State regulation [15 USC 1692o]
The
Commission shall by regulation exempt from the requirements of this title any
class of debt collection practices within any State if the Commission
determines that under the law of that State that class of debt collection
practices is subject to requirements substantially similar to those imposed by
this title, and that there is adequate provision for enforcement.
818.
Effective date [15 USC 1692 note]
This
title takes effect upon the expiration of six months after the date of its
enactment, but section 809 shall apply only with respect to debts for which the
initial attempt to collect occurs after such effective date.

Legislative
History
Public Law 95-109
[H.R. 5294]
HOUSE REPORT No. 95-131 (Comm. on Banking,
Finance, and Urban Affairs).
SENATE REPORT No. 95-382 (Comm. on Banking,
Housing, and Urban Affairs).
CONGRESSIONAL RECORD, Vol. 123 (1977):
Apr.
4, considered and passed House.
Aug.
5, considered and passed Senate, amended.
Sept.
8, House agreed to Senate amendment.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS,
Vol. 13, No. 39:
Sept.
20, Presidential statement.

Amendments
SECTION 621, SUBSECTIONS (b)(3), (b)(4) and (b)(5) were
amended to transfer certain administrative enforcement responsibilities,
pursuant to Pub. L. 95-473, § 3(b), Oct. 17, 1978. 92 Stat. 166; Pub. L.
95-630, Title V. § 501, November 10, 1978, 92 Stat. 3680; Pub. L. 98-443, §
9(h), Oct. 4, 1984, 98 Stat. 708.
SECTION 803, SUBSECTION (6), defining “debt
collector,” was amended to repeal the attorney at law exemption at former
Section (6)(F) and to redesignate Section 803(6)(G) pursuant to Pub. L. 99-361,
July 9, 1986, 100 Stat. 768. For legislative history, see H.R. 237, HOUSE
REPORT No. 99-405 (Comm. on Banking, Finance and Urban Affairs). CONGRESSIONAL
RECORD: Vol. 131 (1985): Dec. 2, considered and passed House. Vol. 132 (1986):
June 26, considered and passed Senate.
SECTION 807, SUBSECTION (11), was amended to
affect when debt collectors must state (a) that they are attempting to collect
a debt and (b) that information obtained will be used for that purpose,
pursuant to Pub. L. 104-208 § 2305, 110 Stat. 3009 (Sept. 30, 1996). 1 So
in original; however, should read “604(a)(3).”

The Fair Credit Billing
Act
TABLE
OF CONTENTS
301Short title302Declaration of
purpose303Definitions of
creditor and open end credit plan304Disclosure of fair
credit billing rights305Disclosure of billing
contact306Billing practices307Conforming amendments308Effective date
601.
Short title
This
title may be cited as the “Fair Credit Billing Act”.
302.
Declaration of purpose
The
last sentence of section 102 of the Truth in Lending Act(15 U.S.C. 1601) is
amended by striking out the period and inserting in lieu thereof a comma and
the following: “and to protect the consumer against inaccurate and unfair
credit billing and credit card practices”.
303.
Definitions of creditor and open end credit plan
The
first sentence of section 103(f) of the Truth in Lending Act (15 U.S.C.
1602(f)) is amended to read as follows: “The term ‘creditor’ refers only
to creditors who regularly extend, or arrange for the extension of, credit
which is payable by agreement in more than four installments or for which the
payment of a finance charge is or may be required, whether in connection with
loans, sales of property or services, or otherwise. For the purposes of the
requirements imposed under Chapter 4 and sections 127(a) (6), 127(a) (7),
127(a) (8), 127(b) (1), 127(b) (2), 127(b) (3), 127(b) (9), and 127(b) (11) of
Chapter 2 of this Title, the term ‘creditor’ shall also include card issuers
whether or not the amount due is payable by agreement in more than four
installments or the payment of a finance charge is or may be required, and the
Board shall, by regulation, apply these requirements to such card issuers, to the
extent appropriate, even though the requirements are by their terms applicable
only to creditors offering open end credit plans”.
304.
Disclosure of fair credit billing rights
(a)Section
127(a) of the Truth in Lending Act (15 U.S.C. 1637(a)) is amended by adding at
the end thereof a new paragraph as follows:
“(8)
A statement, in a form prescribed by regulations of the Board of the protection
provided by sections 161 and 170 to an obligor and the creditors
responsibilities under sections 162 and 170. With respect to each of two
billing cycles per year, at semiannual intervals, the creditor shall transmit
such statement to each obligor to whom the creditor is required to transmit a
statement pursuant to sections 127(b) for such billing cycle”.
(b)Section
127(c) of such Act (15 U.S.C. 1637(c)) is amended to read:
“(c)
In the case of any existing account under an open end consumer credit plan
having an outstanding balance of more than $1 at or after the close of the
creditors first full billing cycle under the plan after the effective date of
subsection (a) or any amendments thereto, the items described in subsection
(a), to the extent applicable and not previously disclosed, shall be disclosed
in a notice mailed or delivered to the obligor not later than the time of
mailing the next statement required by subsection (b)”.
305.
Disclosure of billing contact
Section
127(b) of the Truth in Lending Act (15 U.S.C. 1637(b)) is amended by adding at
the end thereof a new paragraph as follows:
“(11)
The address to be used by the creditor for the purpose of receiving billing
inquiries from the obligor”.
306.
Billing practices
The
Truth in Lending Act (15 U.S.C. 1601-1665) is amended by adding at the end
thereof a new chapter as follows:
Chapter
4 – CREDIT BILLING
Sec.
161. Correction of billing errors
162. Regulation of credit reports.
163. Length of billing period.
164. Prompt crediting of payments.
165. Crediting excess payments.
166. Prompt notification of returns.
167. Use of cash discounts.
168. Prohibition of tie-in services.
169. Prohibition of offsets.
170. Rights of credit card customers.
171. Relation to State laws.

161.
Correction of billing errors
“(a)If
a creditor, within sixty days after having transmitted to an obligor a
statement of the obligor’s account in connection with an extension of consumer
credit, receives at the address disclosed under section 127(b) (11) a written
notice (other than notice on a payment stub or other payment medium supplied by
the creditor if the creditor so stipulates with the disclosure required under
section 127(a) (8)) from the obligor in which the obligor –
“(1)sets
forth or otherwise enables the creditor to identify the name and account number
(if any) of the obligor,
“(2)indicates
the obligor.s belief that the statement contains a billing error and the amount
of such billing error, and
“(3)sets
forth the reasons for the obligor.s belief (to the extent applicable) that the
statement contains a billing error,
the
creditor shall, unless the obligor has, after giving such written notice and
before the expiration of the time limits herein specified, agreed that the
statement was correct –
“(A)not
later than thirty days after the receipt of the notice, send a written
acknowledgment thereof to the obligor, unless the action required in subparagraph
(B) is taken within such thirty-day period, and
“(B)not
later than two complete billing cycles of the creditor (in no event later than
ninety days) after the receipt of the notice and prior to taking any action to
collect the amount, or any part thereof, indicated by the obligor under
paragraph (2) either –
“(i)make
appropriate corrections in the account of the obligor, including the crediting
of any finance charges on amounts erroneously billed, and transmit to the
obligor a notification of such corrections and the creditor’s explanation of
any cage in the amount indicated by the obligor under paragraph (2) and, if any
such change is made and the obligor so requests, copies of documentary evidence
of the obligor’s indebtedness; or
“(ii)send
a written explanation or clarification to the obligor, after having conducted
an investigation, setting forth to the extent applicable the reasons why the
creditor believes the account of the obligor was correctly shown in the
statement and, upon request of the obligor, provide copies of documentary
evidence of the obligor’s indebtedness. In the case of a billing error where
the obligor alleges that the creditor’s billing statement reflects goods not
delivered to the obligor or his designee in accordance with the agreement made
at the time of the transaction, a creditor may not construe such amount to be
correctly shown unless he determines that such goods were actually delivered,
mailed, or otherwise sent to the obligor and provides the obligor with a statement
of such determination.
After
complying with the provisions of this subsection with respect to an alleged
billing error, a creditor has no further responsibility under this section if
the obligor continues to make substantially the same allegation with respect to
such error.
“(b)For
the purpose of this section, a ‘billing error’ consists of any of the
following:
“(1)A
reflection on a statement of an extension of credit which was not made to the
obligor or, if made, was not in the amount reflected on such statement.
“(2)A
reflection on a statement of an extension of credit for which the obligor
requests additional clarification including documentary evidence thereof.
“(3)A
reflection on a statement of goods or services not accepted by the obligor or
his designee or not delivered to the obligor or his designee in accordance with
the agreement made at the time of a transaction.
“(4)The
creditor’s failure to reflect properly on a statement a payment made by the
obligor or a credit issued to the obligor.
“(5)A
computation error or similar error of an accounting nature of the creditor on a
statement.
“(6)Any
other error described in regulations of the Board.
“(c)For
the purposes of this section, ‘action to collect the amount, or any part
thereof, indicated by an obligor under paragraph (2)’ does not include the
sending of statements of account to the obligor following written notice from
the obligor as specified under subsection (a) if –
“(1)the
obligor’s account is not restricted or closed because of the failure of the
obligor to pay the amount indicated under paragraph (2) of subsection (a) and
“(2)the
creditor indicates the payment of such amount is not required pending the
creditor’s compliance with this section.
Nothing
in this section shall be construed to prohibit any action by a creditor to
collect any amount which has not been indicated by the obligor to contain a
billing error.
“(d)Pursuant
to regulations of the Board, a creditor operating an open end consumer credit
plan may not, prior to the sending of the written explanation or clarification
required under paragraph (B) (ii), restrict or close an account with respect to
which the obligor has indicated pursuant to subsection (a) that he believes
such account to contain a billing error solely because of the obligor’s failure
to pay the amount indicated to be in error. Nothing in this subsection shall be
deemed to prohibit a creditor from applying against the credit limit on the
obligor’s account the amount indicated to be in error.
“(e)Any
creditor who fails to comply with the requirements of this section or section
162 forfeits any right to collect from the obligor the amount indicated by the
obligor under paragraph (2) of subsection (a) of this section, and any finance
charges thereon, except that the amount required to be forfeited under this
subsection may not exceed $50.
162.
Regulation of credit reports
“(a)After
receiving a notice from an obligor as provided in section 161(a), a creditor or
his agent may not directly or indirectly threaten to report to any person
adversely on the obligor’s credit rating or credit standing because of the
obligor’s failure to pay the amount indicated by the obligor under section
161(a) (2) and such amount may not be reported as delinquent to any third party
until the creditor has met the requirements of section 161 and has allowed the
obligor the same number of days (not less than ten) thereafter to make payment
as is provided under the credit agreement with the obligor for the payment of
undisputed amounts.
“(b)If
a creditor receives a further written notice from an obligor that an amount is
still in dispute within the time allowed for payment under subsection (a) of
this section, a creditor may not report to any third party that the amount of
the obligor is delinquent because the obligor has failed to pay an amount which
he has indicated under section 161(a) (2), unless the creditor also reports
that the amount is in dispute and, at the same time, notifies the obligor of
the name and address of each party to whom the creditor is reporting
information concerning the delinquency.
“(c)A
creditor shall report any subsequent resolution of any delinquencies reported
pursuant to subsection (b) to the parties to whom such delinquencies were
initially reported.
163.
Length of billing period
“(a)If
an open end consumer credit plan provides a time period within which an obligor
may repay any portion of the credit extended without incurring an additional
finance charge, such additional finance charge may not be imposed with respect
to such portion of the credit extended for the billing cycle of which such
period is a part unless a statement which includes the amount upon which the
finance charge for that period is based was mailed at least fourteen days prior
to the date specified in the statement by which payment must be made in order
to avoid imposition of that finance charge.
“(b)Subsection
(a) does not apply in any case where a creditor has been prevented, delayed, or
hindered in making timely mailing or delivery of such periodic statement within
the time period specified in such subsection because of an act of God, war,
natural disaster, strike, or other excusable or justifiable cause, as
determined under regulations of the Board.
164.
Prompt crediting of payments
“Payments
received from an obligor under an open end consumer credit plan by the creditor
shall be posted promptly to the obligor’s account as specified in regulations
of the Board. Such regulations shall prevent a finance charge from being
imposed on any obligor if the creditor has received the obligor’s payment in
readily identifiable form in the amount, manner, location, and time indicated
by the creditor to avoid the imposition thereof.
165.
Crediting excess payments
“Whenever
an obligor transmits funds to a creditor in excess of the total balance due on
an open end consumer credit account, the creditor shall promptly (1) upon
request of the obligor refund the amount of the overpayment, or (2) credit such
amount to the obligor.s account.
166.
Prompt notification of returns
“With
respect to any sales transaction where a credit card has been used to obtain
credit, where the seller is a person other than the card issuer, and where the
seller accepts or allows a return of the goods or forgiveness of a debit for
services which were the subject of such sale, the seller shall promptly
transmit to the credit card issuer, a credit statement with respect thereto and
the credit card issuer shall credit the account of the obligor for the amount
of the transaction.
167.
Use of cash discounts
“(a)With
respect to credit card which may be used for extensions of credit in sales
transactions in which the seller is a person other than the card issuer, the
card issuer may not, by contract or otherwise, prohibit any such seller from
offering a discount to a cardholder to induce the cardholder to pay by cash,
check, or similar means rather than use a credit card.
“(b)With
respect to any sales transaction, any discount not in excess of 5 per centum
offered by the seller for the purpose of inducing payment by cash, check, or
other means not involving the use of a credit card shall not constitute a
finance charge as determined under section 106, if such discount is offered to
all prospective buyers and its availability is disclosed to all prospective buyers
clearly and conspicuously in accordance with regulations of the Board.
168.
Prohibition of tie-in services
Notwithstanding
any agreement to the contrary, a card issuer may not require a seller, as a
condition to participating in a credit card plan, to open an account with or
procure any other service from the card issuer or its subsidiary or agent.
169.
Prohibition of offsets
“(a)A
card issuer may not take any action to offset a cardholder’s indebtedness
arising in connection with a consumer credit transaction under the relevant
credit card plan against funds of the cardholder held on deposit with the card
issuer unless –
“(1)such
action was previously authorized in writing by the cardholder in accordance
with a credit plan whereby the cardholder agrees periodically to pay debts
incurred in his open end credit account by permitting the card issuer
periodically to deduct all or a portion of such debt from the cardholder’s
deposit account, and
“(2)such
action with respect to any outstanding disputed amount not be taken by the card
issuer upon request of the cardholder.
In
the case of any credit card account in existence on the effective date of this
section, the previous written authorization referred to in clause (1) shall not
be required until the date (after such effective date) when such account is
renewed, but in no case later than one year after such effective date. Such
written authorization shall be deemed to exist if the card issuer has
previously notified the cardholder that the use of his credit card account will
subject any funds which the card issuer holds in deposit accounts of such
cardholder to offset against any amounts due and payable on his credit card
account which have not been paid in accordance with the terms of the agreement
between the card issuer and the cardholder.
“(b)This
section does not alter or affect the right under State law of a card issuer to
attach or otherwise levy upon funds of a cardholder held on deposit with the
card issuer if that remedy is constitutionally available to creditors
generally.
170.
Rights of credit card customers
“(a)Subject
to the limitation contained in subsection (b), a card issuer who has issued a
credit card to a cardholder pursuant to an open end consumer credit plan shall
be subject to all claims (other than tort claims) and defenses arising out of
any transaction in which the credit card is used as a method of payment or
extension of credit if (1) the obligor has made a good faith attempt to obtain
satisfactory resolution of a disagreement or problem relative to the
transaction from the person honoring the credit card; (2) the amount of the
initial transaction exceeds $50; and (3) the place where the initial
transaction occurred was in the same State as the mailing address previously
provided by the cardholder or was within 100 miles from such address, except
that the limitations set forth in clauses (2) and (3) with respect to an
obligor’s right to assert claims and defenses against a card issuer shall not
be applicable to any transaction in which the person honoring the credit card
(A) is the same person as the card issuer, (B) is controlled by the card
issuer, (C) is under direct or indirect common control with the card issuer,
(D) is a franchised dealer in the card issuer’s products or services, or (E)
has obtained the order for such transaction through a mail solicitation made by
or participated in by the card issuer in which the cardholder is solicited to
enter into such transaction by using the credit card issued by the card issuer.
“(b)The
amount of claims or defenses asserted by the cardholder may not exceed the
amount of credit outstanding with respect to such transaction at the time the
cardholder first notifies the card issuer or the person honoring the credit
card of such claim or defense. For the purpose of determining the amount of
credit outstanding in the preceding sentence, payments and credits to the
cardholder’s account are deemed to have been applied, in the order indicated,
to the payment of: (1) late charges in the order of their entry to the account;
(2) finance charges in order of their entry to the account; and (3) debits to
the account other than those set forth above, in the order in which each debit
entry to the account was made.
171.
Relation to State laws
“(a)This
chapter does not annul, alter, or affect, or exempt any person subject to the
provisions of this chapter from complying with, the laws of any State with
respect to credit billing practices, except to the extent that those laws are
inconsistent with any provision of this chapter, and then only to the extent of
the inconsistency. The Board is authorized to determine whether such
inconsistencies exist. The Board may not determine that any State law is
inconsistent with any provision of this chapter if the Board determines that
such law gives greater protection to the consumer.
“(b)The
Board shall by regulation exempt from the requirements of this chapter any
class of credit transactions within any State if it determines that under the
law of that State that class of transactions is subject to requirements
substantially similar to those imposed under this chapter or that such law
gives greater protection to the consumer, and that there is adequate provision
for enforcement.”
307.
Conforming amendments
(a)The
table of chapter of the Truth in Lending Act is amended by adding immediately
under item 3 the following:
“4.
CREDIT BILLING . . . . . . . . . . . . . . . . . . . . . . . . . 161”
(b)Section
111(d) of such Act (15 U.S.C. 1610(d)) is amended by striking out “and
130” and inserting in lieu thereof a comma and the following: “130,
and 166”
(c)Section
121(a) of such Act (15 U.S.C. 1631(a)) is amended –
(1)by
striking out “and upon whom a finance charge is or may be imposed”;
and
(2)by
inserting “or chapter 4” immediately after “this chapter”.
(d)Section
121(b) of such Act (15 U.S.C. 1631(b)) is amended by inserting “or chapter
4” immediately after “this chapter”.
(e)Section
122(a) of such Act (15 U.S.C. 1632(a)) is amended by inserting “or chapter
4” immediately after “this chapter”.
(f)Section
122(b) of such Act (15 U.S.C. 1632(b)) is amended by inserting “or chapter
4” immediately after “this chapter”.
308.
Effective date
This
title takes effect upon the expiration of one year after the date of its
enactment.