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FCRA - FAIR CREDIT REPORTING ACT

Terms in this set (24)

FAIR CREDIT REPORT ACT
FCRA
the law creates special obligations and restrictions for Consumer Reporting Agencies (CRAs), and for furnishers and users of consumers' personal information.
FCRA
Authority AND Enforcement
CFPB IN 2011
FTC: retains some rulemaking and enforcement
FCRA
Regulations
Regulation V
FCRA
Appendix M
Provides Model forms for the notices and disclosures required by FCRA
FCRA
Covered Transactions
ANY TRANSACTION THAT INVOLVES:
the use of Credit Reports,
Consumer investigatory reports,
Employment background checks.

PRIVACY REQUIREMENTS DO NOT APPLY TO:
Disclosures of limited information to:
Government Agencies,
FBI
Counter-terrorism investigations
FCRA
Term: Consumer Report
Consumer report:
the communication of any information from a consumer reporting agency that relates to a consumer's credit worthiness, credit standing, credit capacity, character, personal characteristics, or mode of living which is used or expected to be used in order to determine the consumer's eligibility for credit or insurance to be used for personal, family, or household purposes or to evaluate a consumer for employment.
FCRA
Term: Consumer Reporting Agency (CRA)
Consumer reporting agency (CRA):
any person who regularly engages for fees or on a cooperative nonprofit basis in the practice of assembling or evaluating of consumer credit information in order to provide consumer reports to third parties.

Large Participants: receipts exceeding $7 million
(Equifax, Experian, TransUnion)
FCRA
Term: Creditor
Creditor:
Any person who regularly extends, renews, or continues credit; any person who regularly arranges for the extension, renewal, or continuation of credit; or any assignee of an original creditor who participates in the decision to extend, renew, or continue credit
FCRA
Term: Investigative Consumer Report
Investigative consumer report:
a consumer report containing information about a consumer's character, general reputation, personal characteristics, and mode of living that is obtained
through personal interviews
FCRA
Term: Fraud Alert
Fraud alert:
a statement in the file of a consumer that notifies all prospective users of a consumer report relating to the consumer that the consumer may be a victim of fraud, including identity theft, and that is presented in a manner that facilitates a clear and conspicuous view of
that statement.
FCRA
Term: Adverse Action
Adverse action:
this term is given the same meaning under FCRA as under ECOA, meaning a denial of credit or an extension of credit in a substantially smaller amount, or for terms
substantially different, than that requested by the loan applicant. It also means any denial or unfavorable change in insurance coverage, or a denial of employment based on an investigative consumer report.
FCRA
Disclosure Requirements in Consumer Reports
BANKRUPTCY:
Show which Chapter filed
State withdrawal if before completion

CREDIT INQUIRIES:
If credit Inquires were a factor in adversely affecting credit
Voluntary closed credit accounts

ADDRESS DISCREPANCIES:
Difference in address on file. must notify person requesting the report
FCRA
Restrictions on INCLUDED consumer information
▪ Bankruptcy cases that are more than ten years old
▪ Civil lawsuits that are more than seven years old, unless the statute of limitations has not
yet expired
▪ Arrest records that are more than seven years old, unless the statute of limitations has not
yet expired
▪ Accounts placed for collection (or charged off) that are more than seven years old
▪ Any other adverse information that is more than seven years old, other than conviction of
a crime (conviction of a crime can always be reported, no matter how old)
▪ The name, address, and telephone number of any medical information provider, unless
either:
o That information does not convey information on the nature of the services (the
name of a psychiatric center, for example, would not qualify because it conveys
information that the consumer has mental health problems), or
o The report is being provided to an insurance company for purposes related to an
insurance matter not involving property and casualty insurance
FCRA
Situations where rules do not apply:
$150,000 Credit /$150,000 Life /$75,000 employment

▪ A credit transaction involving, or which may reasonably be expected to involve, a principal amount of at least $150,000
▪ The underwriting of life insurance involving, or which may reasonably be expected to involve, a face amount of at least $150,000
▪ An employment situation in which the employee is expected to receive an annual salary of at least $75,000
FCRA
Evaluating a Credit Report
Check identifying Information
Multiple Spellings, Addresses, SSN's
Bankruptcies
Outstanding Judgements
Mortgages
Liens
Open and Closed Lines of credit
Payment History
Balances
Discrepancies between Report and disclosed by applicant
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