The Fair Credit Reporting Act of 1970 governs the collection, use, and distribution of your personal consumer information. Enacted on October 26, 1970, it represents an amendment to the Consumer Credit Protection Act of 1969 and is enforced by the Federal Trade Commission. This law is commonly referred to as FCRA. The Federal Trade Commission maintains a consumer-friendly online summary of the rights that the law provides to consumers.
History of the Fair Credit Reporting Act
Originally, the law primarily concerned banks and consumer reporting agencies (CRAs) and the companies that supplied them with information. Today, this law applies to a wide range of institutions that collect personal information from you directly, as well as public records. The law was amended in 2003 under the Fair and Accurate Credit Transactions Act (FACTA) to allow consumers to obtain a free report from consumer reporting agencies governed by the FCRA. At that time, the list of consumer reporting agencies had significantly expanded. The FCRA outlines which institutions must comply with the law based on the type of information being handled. As lenders expanded their creditworthiness searches to include things like utility bills and rental history, institutions that collect this type of information are also included.
Consumer Rights Under the Fair Credit Reporting Act
In general, the FCRA states that you can see any information that consumer reporting agencies have in your files and that you have the right to dispute inaccurate information in those files. If you dispute something, the FCRA specifies how to resolve this dispute, and if the inaccurate information is removed, you must also be notified within 5 days if the information is reinserted in your file.
If you are a victim of identity theft, the most important part of the FCRA is Section 609 (e). This is the part that states that if a company deals with someone using your information (in other words, an identity thief impersonating you), they must provide you with all requests and business records that were made under your name.
However, companies have caused a great deal of trouble for identity theft victims regarding this. Some companies claim they cannot disclose records because they are proprietary, and others may say they will not provide you with the information without a court order. Some have even gone so far as to say they won’t provide that information because they have to protect the privacy of their customers (be careful when they tell you this). The issue is common enough that the Federal Trade Commission has written guidelines specifically addressing this matter. They have also created a letter you can download to send to the company if you need to obtain these records.
Note: The FCRA states that these records can be provided to you and to a law enforcement officer that you designate, which will likely be the investigator looking into your case (provided you have one).
One of the advantages that the FCRA provides to consumers is that it allows an ordinary citizen to sue any “nationally specialized consumer reporting agency” that violates the law in state or federal court.
The statute of limitations is either five years after the violation that forms the basis of the claim or two years after the plaintiff discovers the violation, whichever comes first. (In other words, if you discover the violation one year after it occurred, but then wait three years to act, you will be barred from filing a lawsuit by the two-year limitation starting from the date of your previous discovery, even though you are still within the five-year time limit for the subsequent event.) Companies that know they have violated the FCRA may be able to dismiss the case by notifying their customers of the error, as this will give customers a two-year time frame instead; after that, they can argue that the statute of limitations has already expired.
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Sources
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Congressional Research Service. “Consumer Credit Protection Act: Overview of Its Key Components,” Summary.
U.S. Government Publishing Office. “Title I – Disclosure of Consumer Credit Cost,” Page 146.
Consumer Financial Protection Bureau. “FCRA Compliance Procedures.”
Federal Trade Commission. “Fair Credit Reporting Act,” Page 3.
Federal Trade Commission. “Fair Credit Reporting Act,” Pages 58-61.
Federal Trade Commission. “Fair Credit Reporting Act,” Page 49.
Federal Trade Commission. “Kohl’s Department Stores, Inc.: Complaint Regarding Permanent Injunction, and Other Equitable Relief, Civil Penalties, June 10, 2020,” Pages 4-6.
Federal Trade Commission. “Businesses Must Provide Identity Theft Victims and Law Enforcement with Records Related to Identity Theft.”
Federal Trade Commission. “Fair Credit Reporting Act,” Pages 49-50.
Federal Trade Commission. “Fair Credit Reporting Act,” Pages 80-81.
Source: https://www.thebalancemoney.com/fair-credit-reporting-act-of-1970-1947567
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