Fair Debt Credit Reporting Act

The Fair Credit Reporting Act was enacted to ensure that consumer reporting agencies adopt standards and procedures to meet consumers' needs in a manner that is fair and equitable. This includes ensuring information is used in a way that promotes confidentiality and relevancy, including being relevant to a consumer's needs.

Consumer Reports

This act lays out the reasons that a consumer's information may be disclosed to another party. This includes a court order or written instructions from the consumer to disclose the information. Information may also be provided to a person who intends to use it to extend credit or insurance to the consumer, as well as for employment purposes or to determine eligibility for a government license. The information may also be provided if the requestor is involved in a business transaction that was initiated by the consumer. The information will be available to child support agencies, as well.

Disclosure

A consumer must be notified by the requestor of any time an attempt to access his information is made. In the case of an employment need, disclosure must be made in writing unless the consumer has previously provided written consent.

Adverse Actions

If a review of the consumer's information results in a negative outcome for the consumer (for example, denial of credit or withdrawal of an employment offer), then the consumer must be given a copy of the report that resulted in the denial and a description of her rights as afforded by the Federal Trade Commission. If the consumer applied for the credit or the job via mail, telephone or computer, then she must be provided the name, address and phone number of the consumer reporting agency that provided the information, and the company that denied her application must disclose that the consumer may request a free report from that agency. This notification must also explain that the decision was not made by the reporting agency.

Exceptions

The disclosure regulations do not apply if the request is made by an agency of the United States government, if the information is relevant to national security or is part of an investigation that is under the jurisdiction of the requesting agency. These regulations also do not apply if the agency believes that disclosure will endanger innocent lives or compromise an ongoing investigation. Once the investigation is complete, notification should be made with a copy of the report (minus any classified information), disclosure of any action taken and information regarding the nature of the investigation.