Fair Credit Reporting Act Summary
The Fair Credit Reporting Act- (15 U.S.C. §§ 1681-1681u, as amended)
What is required?
The Fair Credit Reporting Act (FCRA) regulates the information collected by consumer reporting agencies. In addition, it requires that the information supplied to consumer reporting agencies is accurate. The FCRA also give a consumer the right to learn about the information contained in a consumer report.
Who is regulated?
The FCRA applies to consumer reporting agencies, for example Transunion, Equifax, and Experian. It also applies to companies furnishing information to credit reporting agencies and the users of a consumer report, such as a lender making a credit decision.
When does the law apply?
The FCRA applies when a consumer reporting agency collects information, a creditor provides information to the consumer reporting agency, or a creditor uses a consumer report to make a credit decision.
- If a consumer applies for credit and is denied and that creditor used a consumer report in making that decision, the creditor must provide a notice to the consumer stating that the creditor used a consumer report in its decision and give the consumer the opportunity to request the consumer report from the consumer reporting agency.
- If a company reports incorrect information about a consumer to a consumer reporting agency, the consumer has the right to dispute the information with the consumer reporting agency.
- If a credit card company sends a consumer a “pre-approved” credit card solicitation, the solicitation must include a firm offer of credit, meaning that the offer included in the solicitation must be the credit the consumer will receive if she accepts the offer.
- If a consumer is a victim of identity theft, the consumer can request that any debts incurred as a result of that identity theft be blocked from a consumer report.
Is there a solution?
If a consumer reporting agency or creditor fails to honor its responsibilities under FCRA, a consumer may be entitled to actual damages and statutory damages from $100 to $1,000. In addition, the FCRA contains what is known as a “fee-shifting” provision which may require the defendant to cover the attorney fees and court costs.
Last Modified: Thursday, May 9, 2013