Fair Credit Reporting Act

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Fair Credit Reporting Act , 15 U.S.C. Ã,§ 1681 (" FCRA ") is a U.S. federal law authorized to promote the accuracy, fairness and privacy of consumer information contained in the file of the consumer reporting body. It is intended to protect consumers from deliberate information and/or fail to include inaccurate information in their credit reports. To that end, FCRA governs the collection, dissemination, and use of consumer information, including consumer credit information. Together with the Fair Debt Collection Act ("FDCPA"), FCRA forms the legal basis for consumer rights in the United States. It was originally ratified in 1970, and enforced by the US Federal Trade Commission, Consumer Financial Protection Bureau and private officials.

Video Fair Credit Reporting Act

History

The Fair Credit Reporting Act, as originally authorized, is the title VI Pub.L. 91-508, 84Ã, Stat. 1114, adopted October 26, 1970, entitled A Law to amend the Federal Deposit Insurance Act to require an insured bank to maintain certain records, to require that certain transactions in the United States currency be reported to the Treasury, and for the purpose other . It was written as an amendment to add the title VI to the Consumer Credit Protection Act, Pub.L. 90-321, 82Ã, Stat. 146, adopted June 29, 1968.

The Fair Credit Reporting Law is one of the first examples of data protection legislation passed in the computer age. The findings of the US Congress leading to the Act, and the main regulatory innovations Act, set the direction of information privacy in the US and the world over the next fifty years. The key among these innovations is the determination that no secret database should be used to make decisions about a person's life, that an individual should have the right to view and challenge information stored in that database, and that the information in the database must expires after a reasonable period of time.

Maps Fair Credit Reporting Act

Consumer reports

Commonly referred to as credit reports, consumer reports "contain information about your credit - and some bill payment history - and your credit account status.This information includes how often you make payments on time, how much credit you have, how much credit you have how much credit you use, and whether debt or debt collectors collect the money you borrow.Credit reports can also contain payback information if you are a tenant of property.It can also contain public records such as liens, assessments, and bankruptcies provide insight into your financial status and obligations. "

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Inaccuracies in consumer reports

A 2015 study released by the Federal Trade Commission found that 23% of consumers identified inaccurate information in their credit reports. Under the Fair and Accurate Credit Transactions Act (FACTA), an amendment to FCRA passed in 2003, consumers may receive free copies of their consumer reports from each credit reporting agency once a year. Free reports can be requested by phone, mail, or through the official government website: annualcreditreport.com. Consumer reports obtained through annualcreditreport.com facilitate the identification and dispute of inaccurate information.

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Civil liability

FCRA governs:

1. Consumer reporting bureau;
2. User consumer reports; and,
3. Fans of consumer information.

If consumer rights under FCRA are violated, they can recover:

1. Actual or legal damages;
2. Attorney fees;
3. court costs; and,
4. The penalty for damages if the violation is intentional. "The threat of punitive damages under 1681n from FCRA is a major factor that hinders the false reporting by the reporting industry."

Restrict laws require consumers to file a lawsuit prior to the first: two years after the violation is found; or, five years after the offense occurred.

Consumer attorneys often take these cases with contingency costs because the law allows consumers to recover the attorney's fees from the offending party.

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Consumer reporting users

User information for credit, insurance or employment purposes (including background checks) has the following responsibilities under FCRA:

1. The user may only obtain consumer reports for the purposes allowed under FCRA;
2. The user must notify the consumer when any harmful action is taken on the basis of the report; and,
3. The user must identify the company providing the report, so that the accuracy and completeness of the report can be verified or contested by the consumer.

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Job background check

Employers use consumer reports to screen job applicants or employees must follow certain procedures:

1. Get your written permission;
2. Tell you how they want to use your credit report;
3. Not misuse your information;
4. Gives you a copy of your credit report if the employer decides not to hire or fire you; and,
5. Gives you the opportunity to dispute the information contained in your credit report before making a final, adverse decision.

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Manufacturer information

A creditor, as defined by FCRA, is a company that provides information to consumer reporting agencies. Typically, this is the creditor, with which the consumer has some sort of credit agreement (such as credit card companies, car finance companies and mortgage banking institutions).

Other examples of information providers are collection agencies (third party collectors), state or municipal courts that report past and present assessments of some types, employers and bondholders. Lenders have an important role to play in ensuring accurate credit reports. Under FCRA, creditors providing consumer information to consumer reporting agencies should:

1. Provide complete and accurate information to credit reporting agencies;
2. Investigate consumer disputes received from credit reporting agencies;
3. Correct, delete or verify information within 30 days of receipt of a dispute; and,
4. Inform consumers about any negative information that is in progress or has been placed on a consumer credit report within a month.

(This notification should not be sent as a separate notice, but may be placed on a monthly statement of the consumer If sent as part of a monthly statement, it needs to be conspicuous, but not necessarily in bold) Required words (developed by Ministry of Finance US Federal):

Notice before negative information is reported : We may report information about your account to the credit bureaus. Any late payments, missed payments, or other negligence in your account can be reflected in your credit report.

Notice after negative information is reported : We have notified the credit bureaus about late payments, missed payments, or other defaults on your account. This information can be reflected in your credit report.

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Consumer reporting bureau ("CRA")

Consumer reporting agencies (CRAs) are entities that collect and disseminate information about consumers that will be used for credit evaluation and other specific purposes, including employment. Credit bureaus, a type of consumer reporting agency, store consumer credit reports in their database. CRA has a number of responsibilities under FCRA, including the following:

1. CRA must maintain reasonable procedures to ensure the maximum possible accuracy of the information contained in consumer reports;
2. Inform consumers about him in agency files and take steps to verify the accuracy of information disputed by consumers;
3. If negative information is removed as a result of a consumer dispute, it may not be reinserted without notifying the consumer in writing within five days; and,
4. Remove negative information seven years after the first delinquency (except for bankruptcy (10 years) and tax liens (seven years from the time they were paid).

Three large CRAs - Experian, TransUnion, and Equifax - do not interact with the information maker directly as a result of consumer disputes. They use a system called E-Oscar. In some areas of the country, there are other credit bureaus.

National customized consumer reporting agency

In addition to the three major CRAs, FCRA also grouped dozens of other information technology companies as "national specialty consumer reporting agencies" that produced individual consumer reports used to make credit determinations. According to Section 603 of the Fair Credit Reporting Act, the term "national special consumer reporting agent" means a consumer reporting agent that collects and stores files to consumers nationwide with respect to:

1. Medical record or payment;
2. Residential or tenant history;
3. Check writing history;
4. Job history; or,
5. Insurance claim.

Because these nationwide specialized consumer reporting agencies sell consumer credit report files, they are required to provide annual disclosure of their report files to consumers requesting disclosure. Some of the list of companies classified as national specialized consumer reporting bodies under FCRA include: Telecheck, ChoicePoint, Acxiom, Integrated Screening Partners, Innovis, Office Insurance Services, Data Tenant Services, LexisNexis, Retail Equations, Central Loans, Teletrack, MIB Group, United Health Group (Ingenix Division), and Milliman.

Although the large Experian CRA, Equifax, and TransUnion are required by law to provide the primary source website for consumers to request their reports, national specialized consumer reporting agencies are not required to provide a centralized online resource for disclosure. The FCRA Section 612 requires only national consumer-specific reporting agencies to establish an efficient process for consumers to request consumer reports, which should include, at a minimum, the establishment of each of these agents from a toll-free telephone number for such consumer disclosure requests.

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See also

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References

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External links

• FTC Opinions on the Fair Credit Reporting Act
• The legal text of the Federal Trade Commission
• Mymoney.gov, US Financial Literacy and Education Commission
• List of Consumer Financial Protection Bureau (CFPB) from the latest consumer reporting company as of January 2016
• Fair Credit Reporting Act (FCRA) and Privacy of Your Credit Reports Electronic Privacy Information Center (EPIC)
• The testimony of consumer attorneys who testified how the credit report disputes were actually handled, violated the Act.

Source of the article : Wikipedia