Fair Credit Reporting: Section 603(j)
Section 603(j) sets forth definitions with respect to child support obligations.
Section 603(j) sets forth definitions with respect to child support obligations.
Section 603(k)(1) defines the term “adverse action.”
1. RELATION TO OTHER SECTIONS
Section 603(k)(1)(A) states that the term adverse action “has the same meaning as in section 701(d)(6) of the Equal Credit Opportunity Act.”
1. RELATION TO OTHER LAWS
Section 603(k)(1)(B)(i) defines the term adverse action as including “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.”
1. INITIAL PREMIUM
Section 603(k)(1)(B)(ii) defines the term adverse action as including “a denial of employment or any other decision for employment purposes that adversely affects any current or prospective employee.”
1. RELATION TO OTHER SECTIONS
The term “employment purposes” is defined in section 603(h).
2. DISCIPLINARY ACTION TAKEN BY AN EMPLOYER
Section 603(k)(1)(B)(iii) defines the term adverse action as including “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 604(a)(3)(D).”
1. GENERAL
Subsection 603(k)(1)(B)(iii) provides a specific “adverse action” definition in the context of a consumer’s application for a license or other governmental benefit where the applicant’s financial responsibility or status is a factor that must be considered.
Section 603(k)(1)(B)(iv) defines the term adverse action as including “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 604(a)(3)(F)(ii); and (II) adverse to the interests of the consumer.”
1. GENERAL
Section 603(l) defines the term “firm offer of credit or insurance” to mean “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.” In general, once a consumer accepts such an offer, the entity making the offer cannot condition it on further consumer report information, except that it can verify that the consumer continues to meet the criteria established b
Section 603(m) states that 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 whom the consumer has an account or insurance policy, for purposes of (1) reviewing the account or insurance policy; or (2) collecting the account.
1. GENERAL
Section 603(n) defines the term “State” to mean any State, the Commonwealth of Puerto Rico, the District of Columbia, and any territory or possession of the United States.
Section 603(o) states that certain employment agency communications are exempt from the definition of “consumer report,” where the agency follows prescribed procedures to provide prior notice to, and obtain prior consent from, consumers.
1. EMPLOYMENT AGENCIES
This section exempts from the FCRA communications by employment agencies engaged in procuring (a) jobs for applicants or (b) employees for employers.152
2. EMPLOYMENT SCREENING SERVICES
Section 613(a) provides that a CRA, when it compiles and provides public record information that is likely to have an adverse effect on a consumer’s ability to obtain employment, shall either (1) notify the consumer at the time such information is provided to an employer or potential employer or (2) maintain strict procedures to insure that the information is complete and up to date.
Section 614 provides, “Whenever a consumer reporting agency prepares an investigative consumer report, no adverse information in the consumer report (other than information which is a matter of public record) may be included in a subsequent consumer report unless such adverse information has been verified in the process of making such subsequent consumer report, or the adverse information was received within the three-month period preceding the date the subsequent report is furnished.”
Section 603(r) defines the following credit and debit related terms—card issuer, credit card, debit card, account, electronic fund transfer, credit, and creditor.
Section 603(s) states, “The term ‘Federal banking agency’ has the same meaning as in section 3 of the Federal Deposit Insurance Act” which in turn defines the term to mean the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the Board of Governors of the Federal Reserve System, or the Federal Deposit Insurance Corporation.
Section 603(t) defines “financial institution” as “a State or National bank, a State or Federal savings and loan association, a mutual savings bank, a State or Federal credit union” or anyone else that holds a transaction account (such as a checking account) belonging to a consumer.
Section 603(u) defines “reseller” as a CRA that (1) assembles and merges information from other consumer reporting agencies for purposes of furnishing such information to third parties; and (2) does not maintain a database of the assembled or merged information.
1. RELATION TO OTHER SECTIONS
Section 603(v) defines “Commission” as the Federal Trade Commission.
Sections 616 and 617 impose liability for willful noncompliance and negligent noncompliance, respectively. The monetary penalties mandated by these two sections include actual damages proven by a consumer or a CRA, plus costs and attorneys fees. In the case of willful violations, the court may also award punitive damages to a consumer.
Section 618 allows civil actions to be brought in any court of competent jurisdiction not later than the earlier of (1) two years after the date of discovery by the plaintiff of the violation or (2) five years after the date on which the violation occurred.
Section 619 provides criminal sanctions against any person who knowingly and willfully obtains information about a consumer from a CRA under false pretenses.
Section 620 provides criminal sanctions against any officer or employee of a CRA who knowingly and willfully provides information concerning an individual from the agency’s file to a person not authorized to receive it.
Section 623(a)(5)(A) provides, “A person who furnishes information to a consumer reporting agency regarding a delinquent account being placed for collection, charged to profit or loss, or subjected to any similar action shall, not later than 90 days after furnishing the information, notify the agency of the date of delinquency on the account, which shall be the month and year of the commencement of the delinquency on the account that immediately preceded the action.”
1. RELATION TO OTHER SECTIONS
Section 623(a)(6) requires furnishers to have reasonable procedures to respond to any notification that they receive from a CRA about an identity theft “block,” and to prevent refurnishing such “blocked” information. It also states that after a consumer has submitted an identity theft report “at the address specified by (the furnisher) for receiving such reports,” the furnisher may not report such information to a CRA unless it “subsequently knows or is informed by the consumer that the information is correct.”
1. RELATION TO OTHER SECTIONS
Section 623(a)(7) requires a “financial institution” that regularly reports negative information to nationwide CRAs to provide one clear and conspicuous written notice of that practice to consumers, no later than 30 days after first reporting such information. After providing the notice, the furnisher may provide further negative information “with respect to the same transaction, extension of credit, account, or customer without providing additional notice to the customer.” The Federal Reserve Board was assigned to provide a brief model form for this purpose.