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FCRA OVERVIEW |
The following information
pertains to the revisions to the Federal Fair Credit Reporting Act (FCRA) which became
effective September 30, 1997
This is an overview and is provided as
guidance to our customers. It is not intended as legal advice. This addresses the FCRA as
it applies to employment purposes. There are additional requirements for other than
employment purposes - please consult the Act. For a full copy of the FCRA, visit
http://www.ftc.gov/os/statutes/fcrajump.htm
Here is a summary of the requirements:
Before ordering any information for employment
purposes you must:
a) Disclose that a report will be ordered, on
a document that consists solely of this disclosure.
b) You must obtain written consent from the
applicant.
VSI Comment: If your application form
currently includes your release, this may be satisfactory. The Act calls for a separate
document that consists solely of the disclosure that the reports may be procured
{604(b)(2)(A)}. see Forms: Disclosure Form
If the applicant will earn $75,000.00 or more
per year, there are no restrictions on the number of years of information we can report.
If less than this amount, the amount of information is limited to seven (7) years.
Before you take adverse action (based in whole
or in part) on the information you receive from us, you must:
a) notify the applicant of the adverse action,
orally, in writing or electronically.
b) provide the reports to the applicant.
c) advise the applicant of their rights, in
writing.
d) advise them of the consumer reporting
agency that provided the adverse information.
You must certify to us that you will comply
with the Act.
Complete and return the enclosed form.
see Forms: Client/Customer Certification
Under our interpretation of the FCRA, every
courthouse and all statewide repositories would be considered Consumer Reporting Agencies
and would not be able to report information beyond the seven (7) year time frame. All of
the statewide repositories we have talked with say that they are making no changes to the
amount of information they are reporting. However they too have this under review. Until
they limit the information that is allowed by the Act, we will have to work closely with
you to make sure that we are all in compliance. This will be particularly relevant to
searches with dispositions, and release or parole dates that are not within the seven (7)
year limit.
We would be able to truncate all reports at seven (7) years, however we feel that we would
not be living up to our responsibility to provide you with as much information as
possible. A classic circumstance we want to avoid is where we get a report back from a
statewide repository where they show an arrest for sexual assault nine (9) years ago. The
simple thing to do would be to just not report that since it antedates the report by more
than seven (7) years. However, we feel that until we know the disposition and the sentence
and if incarcerated, the release or parole date, we are not serving you properly.
The Federal FCRA is designed to promote accuracy, fairness, and privacy of information in
the files of every consumer reporting agency (CRA). You can find the complete text of the
FCRA, 15 U.S.C.1681-1681u, at the Federal Trade Commissions web site (http://www.ftc.gov)
This information is not intended as legal
advise. Your own legal counsel should be consulted to provide additional guidance.
SUMMARY OF RIGHTS UNDER FCRA |
The Federal Fair Credit
Reporting Act (FCRA) is designed to promote accuracy, fairness and privacy of information
in the files of every consumer reporting agency (CRA). You can find the complete text of
the FCRA, 15 U.S.C 1681-1681u, at the Federal Trade Commissions web site
(http://www.ftc.gov). The FCRA gives you specific rights, as outlined below. You may have
additional the state law. You may contact a state or local consumer protection agency or a
state attorney general to learn those rights.
1. You must be told if information in your
file has been used against you. Anyone who uses information from a CRA to take action
against you--such as denying an application for credit, insurance, or employment--must
tell you, give you the name, address and phone number of the CRA that provided the
consumer report.
2. You can find what is in your file. At your
request, a CRA must give you the information in your file, and a list of everyone who has
requested it recently. There is no charge for the report if a person has taken action
against you because of information supplied by the CRA, if you request the report within
60 days of receiving notice of the action. You are also entitled to one free report every
twelve months upon request if you certify that (1) you are unemployed and plan to seek
employment within 60 days, (2) you are on welfare, or (3) your report is inaccurate due to
fraud. Otherwise a CRA may charge up to eight dollars.
3. You can dispute inaccurate information with
the CRA. If you tell a CRA that your file contains inaccurate information, the CRA must
investigate the items (usually within 30 days) by presenting to its information source all
relevant evidence you submit, unless your dispute is frivolous. The source must review
your evidence and report its findings to the CRA. (The source also must advise national
CRA's--to which it has provided the data--of any error). The CRA must give you a written
report of the investigation, and a copy of your report if the investigation results in any
change. If the CRA's investigation does not resolve the dispute, you may add a brief
statement to your file. The CRA must normally include a summary of your statement in
future reports. If an item is deleted or dispute statement is filed, you may ask that
anyone who has recently received your report be notified of the change.
4. Inaccurate information must be corrected or
deleted. A CRA must remove or correct inaccurate or unverified information from its files,
usually within 30 days after you dispute it. However, the CRA is not required to remove
accurate data from your files unless it is outdated (as described below) or cannot be
verified. If your dispute results in any change to your report, the CRA cannot reinsert
into your file a disputed item unless the information source verifies its accuracy and
completeness. In addition, the CRA must give you a written notice telling you it has
reinserted the item. The notice must include the name, address, and phone number of the
information source.
5. You can dispute inaccurate items with the source of the information. If you tell
anyone--such as a creditor who reports to the CRA--that you dispute an item, they may not
then report the information to a CRA without including a notice of your dispute. In
addition, once you've notified the source of the error in writing, it may not continue to
report the information if it is, in fact, an error.
6. Outdated information may not be reported.
In most cases, a CRA may not report negative information that is more than seven years
old; ten years for bankruptcies.
7. Access to your file is limited. A CRA may
provide information about you only to people with a need recognized by the FCRA--usually
an application with a creditor, insurer, employer, or other business.
8. Your consent is required for reports that
are provided to employers, or reports that contain medical information. A CRA may not give
out information about you to your employer, or prospective employer, without your written
consent. A CRA may not report medical information about you to your creditors, insurers,
or employers, without your permission.
9. You may choose to exclude your name from
CRA lists for unsolicited credit and insurance offers. Creditors and insurers may use file
information as the basis for sending you unsolicited offers of credit or insurance. Such
offers must include a toll free phone number for you to call if you want your name and
address removed from future lists, if you call, you must be kept off the list for two
years. If you request, complete, and return the CRA form provided for this purpose, you
must be taken off the lists indefinitely.
10. You may seek damages from violators. If a
CRA, a user or (in some cases) a provider of CRA data, violates the FCRA, you may sue them
in state or federal court.
The FCRA gives several different federal
agencies authority to enforce the FCRA. For questions or concerns regarding CRA's,
creditors, and others not listed, please contact:
Federal Trade Commission
Bureau of Consumer Protection - FCRA
Washington, DC 20580
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