Olsen, Olsen & Daines, LLC
FAQs
Fair Credit Reporting Act (FCRA)
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 subchapter 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 subchapter.
section are applicable for the purposes of this subchapter.
(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
1681b of this
title.
(2) Exclusions. — Except as provided in paragraph (3), the term
"consumer report" does not include —
(A) subject to section
1681s-3 of this title, 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
1681m of this title; or
(D) a communication described in subsection (o) or (x) of this
section.
(3) Restriction on sharing of medical information. — Except for
information or any communication of information disclosed as
provided in section
1681b(g)(3) of this title, 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) 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.
(j) Definitions Relating to Child Support Obligations. —
(1) Overdue support. — The term "overdue support" has the
meaning given to such term in section 666(e) of title 42.
(2) State or local child support enforcement agency. — 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 1691(d)(6) of this
title; 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
1681b(a)(3)(D) of this title; 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
1681b(a)(3)(F)(ii) of this title; 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
1691(d)(6) of this title by the Board of Governors of the Federal
Reserve System or any court shall apply.
(l) Firm Offer of Credit or Insurance. — 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) Credit or Insurance Transaction That Is Not Initiated by the
Consumer. — 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) State. — 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) of this section, 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) Consumer Reporting Agency That Compiles and Maintains Files
on Consumers on a Nationwide Basis. — 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) 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) 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; 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
1602(i) of this title) 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 1602 of this title.
(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 1693a of this title.
(5) Credit and creditor. — The terms "credit" and "creditor"
have the same meanings as in section 1691a of this title.
(s) Federal Banking Agency. — The term "Federal banking agency"
has the same meaning as in section 1813 of title 12.
(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 461(b) of title 12)
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.
(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) of this section, 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 1681f of this
title.
(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) of this section 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
78c(a)(26) of this title), any entity established under title I
of the Sarbanes-Oxley Act of 2002 [15 U.S.C. 7211 et seq.], any
board of trade designated by the Commodity Futures Trading
Commission, and any futures association registered with such
Commission.
Subject to subsection (c) of this section, 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 654
of title 42 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 [12 U.S.C. 1811 et seq.] or the Federal Credit Union
Act [12 U.S.C. 1751 et seq.], 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 subchapter, as prescribed
by the Federal Trade Commission under section
1681g(c)(3)of this title.
(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
1681m (a)(3) of this title; 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 subchapter, as prescribed by the Federal
Trade Commission under section
1681g(c)(3)of this
title.
(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
1681m(a) of this title, 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
1681g(c)(3) of this title.
(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) Definitions
For purposes of this paragraph, the following definitions
shall apply:
(i) Classified information
The term "classified information" means information that
is protected from unauthorized disclosure under
Executive Order No. 12958 or successor orders.
(ii) National security investigation
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) of this section 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) of this section; and
(iii) there is not in effect an election by the consumer, made
in accordance with subsection (e) of this section, 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
1681g(a)(5) of this title, 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) of this section 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) of this section, 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 September 30,
1997, 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
1681e of
this title 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
1681c(a)(6) of this title) 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
1681c(a)(6) of this title.
(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 information treated in
the manner required under section
1681c(a)(6) of this title)
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
1681a(d)(3) of this title 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 6802(e) of this title; 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
1681s(b) of this
title, 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 December 4, 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.
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 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.
(5) Any other adverse item of information, other than records of
convictions of crimes which antedates the report by more than seven
years.
(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) of
subsection (a) of this section 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 September 30, 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 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 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
1681g(f)(2)(B) of this title) 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
1681s-2(a)(4) of this title 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
1681s-2(a)(3) of this title 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 December 4, 2003, 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 December 4, 2003, 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
1681a(p) of this title, 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
1681s of this title, 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.
(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
1681a(p) of this title 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
1681a(p) of this title, in accordance with
procedures developed under section
1681s(f) of this title.
(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
1681j(d) of this title; and
(B) provide to the consumer all disclosures required to be
made under section
1681g of this title, 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
1681a(p) of this title 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
1681a(p) of this title, in
accordance with procedures developed under section
1681s(f) of
this title.
(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
1681j(d) of this title 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
1681g of this title, 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
1681a(p) of this title 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
1681a(p) of this title, in accordance with procedures developed
und