Recent amendments to the Fair Credit Reporting Act ("FCRA") will require consumer reporting agencies ("CRAs") or credit bureaus for the first time to provide to: 1) consumers a summary of their rights under the amended FCRA; 2) parties who regularly furnish such agencies with consumer information a notice of their responsibilities under the law; and, 3) those who obtain consumer reports from agencies a notice of their responsibilities. The amendments, which become effective September 30, 1997, are embodied in the "Consumer Credit Reporting Reform Act of 1996" which was signed by the President on September 30, 1996.
The FCRA is designed to promote the accuracy and privacy of consumer information maintained by consumer reporting agencies. CRAs and those who use information from their files have always had specific responsibilities under the FCRA. The recent amendments impose additional responsibilities and, for the first time, impose specific duties on parties who furnish information to consumer reporting agencies.
The FCRA requires the Commission to prescribe the content of the notices, as well as the form of the consumer summary. In order to comply with the law, the notices distributed by consumer reporting agencies must be substantially similar to the notices prescribed by the Commission. The notices will assist consumers in asserting their statutory rights and will give clear guidance about the legal obligations of those who furnish information to CRAs and those who use consumer reports.
On February 28, 1997, the Commission published for comment proposed versions of the three notices. The comment period closed on March 31, 1997. The Commission received 28 comments from credit bureaus and other CRAs, creditors, consumers, regulatory authorities, and other interested parties. In general, the commenters said the Commission's effort was thorough, understandable, succinct, and user-friendly. They also made some suggestions that the Commission believed improved the notices, and thus were included in the text of the final versions of the notices.
The Summary of Consumer Rights
Under the FCRA, consumers who are the subject of consumer reports have specific rights, including the right to learn what information about them is in credit bureau files and the right to dispute inaccurate or incomplete information. In a number of circumstances, including after denial of credit, consumers have a right to a free copy of their credit reports. The summary of consumer rights that the Commission is publishing discusses the major rights that consumers have under the FCRA.
The most significant change to the proposed consumer summary is a revised introduction that more clearly informs consumers about the range of parties covered by the FCRA, and emphasizes consumer rights under state law. The Commission also added a discussion of (1) the rights provided consumers to add a brief statement to their files when they continue to dispute information that the CRA has investigated and concluded to be accurate, and (2) the right of consumers to have revised reports provided to all recent recipients of information from their files, in response to public comment on the summary.
Notice to be Sent to Furnishers of Information
The recent amendments to the FCRA impose, for the first time, specific responsibilities upon those persons who furnish information to consumer reporting agencies. The Commission's notice discusses each of the responsibilities that furnishers will have under the amended FCRA.
Notice to be Sent to Users of Consumer Reports
The users of consumer reports have always had certain responsibilities under the FCRA. When the recent amendments to the FCRA go into effect, users will have substantial additional responsibilities. The Commission's notice sets forth all such responsibilities by type of user.
The Commission received relatively few comments on the furnisher and user notices and therefore there were no major changes from the proposed versions.
Details of the changes to the proposed notices are contained in a Federal Register Notice published today, entitled "Notices of Rights and Duties under the Fair Credit Reporting Act."
The Commission vote to publish the notices was 5-0.
Copies of the notices are available on the Internet at the FTC's World Wide Web Site at: http://www.ftc.gov (no period). FTC documents are also available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC's NewsPhone recording at 202-326-2710.
(FTC File No. P974805)