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Fair Credit Reporting: 8.3.1 Content of Notice

The FCRA requires consumer reporting agencies to provide a notice of rights to consumers who are believed to be victims of fraud or identity theft involving credit, an electronic funds transfer, or an account or transaction at or with a financial institution or other creditor.35

Fair Credit Reporting: 8.3.2 Time and Manner of Notice; Enforcement

The duty of a CRA to provide the ID Theft Rights Notice is triggered any time that a consumer contacts the CRA and expresses a belief that they are a victim of fraud or identity theft involving credit, an electronic fund transfer, or an account or transaction involving a financial institution or creditor.46 The notice for identity theft victims is in addition to any other disclosures that the CRA is required to provide.

The failure of a CRA to deliver the prescribed notice is subject to the usual private remedies of the FCRA.

Fair Credit Reporting: 8.4.2.1 Nature and Content of Notice

Under the FCRA, consumers may request and obtain disclosure of their credit score at any time for a fee.50 Even though these scores are part of the consumer’s file, which the consumer can review once a year free of charge,51 credit scores need not be disclosed absent a specific request from the consumer52 and payment of a fee.53

Fair Credit Reporting: 8.4.2.2 Time and Manner of Notice; Enforcement of Right

CRAs must disclose a credit score and provide the credit score notice “within the same timeframes and manner” as they would provide a disclosure of the consumer’s file under subsection 1681g(a).61 Given that the Act does not actually specify a timeframe for disclosures under subsection 1681g(a), one interpretation would be that CRAs must provide credit scores and the credit scoring notice at the same time as disclosures of the consumer’s credit file when the consumer requests both.

Fair Credit Reporting: 8.4.3.1.1 Introduction

In those instances where a credit score is used in conjunction with the extension of credit secured by residential real estate, the user must provide the credit score free of charge, as well as information regarding the factors used in making up the credit score and additional disclosures relating to the scoring process.65 This requirement applies to both open-end and closed-end credit secured by one- to four-family residential real estate, including purchase and refinance transactions.66 This requi

Fair Credit Reporting: 8.4.3.1.3 Home loan notice

Credit applicants whose mortgage application for a loan is to be secured by one to four units of residential real property are entitled to a specific notice describing how credit scores are used and their role in the mortgage process, along with information on where the consumer may learn more about the scores relating to their application. The language of the notice is prescribed by the Act.88

Fair Credit Reporting: 8.4.3.2 Time and Manner of Notice

The FCRA requires that the user provide notices under section 1681g(g) as soon as is reasonably practicable.89 As such, the user should provide this notice at the time the mortgage user receives and makes use of the score. However, some small processing delay may be acceptable, and showing willfulness or actual damages resulting from such a delay is difficult.90

Fair Credit Reporting: 8.4.3.3 Enforcement of Right

In general, a mortgage user’s failure to deliver the notices relating to the preparation and use of the score is subject to the usual private remedies of the FCRA, including actual damages, punitive damages, costs, and attorney fees.91 However, the Act provides a significant safe harbor to mortgage users.

Fair Credit Reporting: 6.1.1 Overview

Before 1996, furnishers of information to consumer reporting agencies (CRAs) were essentially outside the scope of the FCRA. Despite their central role, furnishers were effectively immune from federal oversight. Before 1996, furnishers were under no federal duty to provide CRAs with correct information, to respond to or investigate a consumer’s dispute, or to cooperate with a CRA’s reinvestigation of the completeness or accuracy of the information which the furnisher itself provided.

Fair Credit Reporting: 6.2.1 Furnishers Provide Information to Consumer Reporting Agencies

Anyone who furnishes consumer information to a consumer reporting agency is a “furnisher” of information under the FCRA.34 No special attribute is required and, in fact, the terms furnisher and furnishing are not defined by the Act.35 The FCRA simply refers to “a person who furnishes information to a consumer reporting agency,” or similar terms.36 Regulation V defines “furnisher,” for the purposes of the furnisher accuracy guidelines, as an entity that f

Fair Credit Reporting: 6.2.2.1 Special Rules for Affiliate Sharing

The rules of the FCRA, including those that apply to furnishers, generally do not apply to companies furnishing information to other entities affiliated by common ownership or corporate control, even if the receiving affiliate functions as an in-house credit reporting agency. Such affiliate sharing of information is generally outside the scope of the FCRA.59 However, a consumer may opt out of the use by an affiliate of this exempt information when the information is used to market its products or services.

Fair Credit Reporting: 6.2.2.2 Direct Selling of Information Not Covered

Creditors sometimes sell information about their customers. In addition to sharing information with their own affiliates, they will sell lists of customers meeting different criteria to other creditors, to direct marketers, and to other compilers of marketing databases. Although such a creditor or other business may be furnishing information, it is not furnishing information to a CRA.

Fair Credit Reporting: 6.3.2.1 Generally

Metro 2 is a standardized reporting format used by furnishers to provide information about consumer accounts to the nationwide CRAs.78 The Metro format software had been around since the 1970s. Metro 2 is the version created after the 1996 amendments to the FCRA and was designed by the nationwide CRAs.

Fair Credit Reporting: 6.3.2.3 Obtaining The Metro 2 Manual in Litigation

The credit reporting industry distributes The Metro 2 Manual widely. Even so, when information about the Metro 2 format is provided in discovery, many defendants routinely insist on confidentiality agreements or protective orders. The justification for these discovery restrictions is doubtful, given that no competitive advantage is at stake and given the availability of much Metro 2 information on various websites.

Fair Credit Reporting: 6.3.2.4 The Mechanics of Metro 2

Creditors use Metro 2 to provide periodic reports to one or more of the CRAs about their current accounts and those just closed out. Data may be transferred by electronic transmission, on data tapes, or by computer disks or cartridges. Normally the “computer dump” of credit data is made monthly, although it can be more or less frequent.91 Generally speaking, creditors convert or transfer their own data into the Metro 2 format so that updated information on their entire active customer base is transferred to the CRAs at one time.

Fair Credit Reporting: 6.3.2.5 Other Standardized Methods of Communication

While Metro 2 is the overwhelmingly dominant way for information to be furnished to CRAs, Metro 2 users can and do submit information about consumers on an individualized basis in some circumstances. For example, when consumers have disputed the accuracy or completeness of information with a CRA, the CRA and the furnisher of that information will communicate about that specific transaction using a Consumer Dispute Verification (CDV).

Fair Credit Reporting: 6.3.3.1 Generally

The Metro 2 format is divided into several “record layouts.” Each layout is a separate chart or table used to collect a defined set of related information. For example, the so-called header record provides information identifying the furnisher, the CRA to which the information is being furnished, and information about the computer transmission itself. Another layout might be a segment used to communicate information about mortgages or employment.

Fair Credit Reporting: 6.3.3.2 Objective Standard

Metro 2 is useful for providing information to nationwide CRAs only to the extent that it creates a uniform standard for the meaning given to each field provided under the Metro 2 format. The usefulness of Metro 2 would be compromised if furnishers assigned different values to the information in the same field.

Fair Credit Reporting: 6.3.3.3.1 Introduction

The base segment is the most important part of the Metro report for anyone concerned with the accuracy of account and personal information furnished by a creditor to a CRA. This segment of the Metro 2 format identifies the consumer, describes the transaction or account, and reports the consumer’s payment history. A couple of fields (blanks to be filled in by the furnisher) capture information specifically required by the FCRA or the Fair Credit Billing Act (FCBA).