§ 1022.54 Duties of users making written firm offers of credit or insurance based on information contained in consumer files. ( a ) *Scope.* This subpart applies to any person who uses a consumer report on any consumer in connection with any credit or insurance transaction that is not initiated by the consumer, and that is provided to that person under section 604(c)(1)(B) of the FCRA (15 U.S.C. 1681b(c)(1)(B)), except for a person excluded from coverage of this part by section 1029 of the Consumer Financial Protection Act of 2010, title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, 124 Stat. 137.
( b ) *Definitions.* For purposes of this section and appendix D of this part, the following definitions apply: ( 1 ) *Simple and easy to understand* means: ( i ) A layered format as described in paragraph (c) of this section;
( ii ) Plain language designed to be understood by ordinary consumers; and
( iii ) Use of clear and concise sentences, paragraphs, and sections.
( iv ) Examples. For purposes of this part, examples of factors to be considered in determining whether a statement is in plain language and uses clear and concise sentences, paragraphs, and sections include: ( A ) Use of short explanatory sentences;
( B ) Use of definite, concrete, everyday words;
( C ) Use of active voice;
( D ) Avoidance of multiple negatives;
( E ) Avoidance of legal and technical business terminology;
( F ) Avoidance of explanations that are imprecise and reasonably subject to different interpretations; and
( G ) Use of language that is not misleading.
( 2 ) *Principal promotional document* means the document designed to be seen first by the consumer, such as the cover letter.
( c ) *Prescreen opt-out notice.* Any person who uses a consumer report on any consumer in connection with any credit or insurance transaction that is not initiated by the consumer, and that is provided to that person under section 604(c)(1)(B) of the FCRA (15 U.S.C. 1681b(c)(1)(B)), shall, with each written solicitation made to the consumer about the transaction, provide the consumer with the following statement, consisting of a short portion and a long portion, which shall be in the same language as the offer of credit or insurance: ( 1 ) *Short notice.* The short notice shall be a clear and conspicuous, and simple and easy to understand statement as follows: ( i ) *Content.* The short notice shall state that the consumer has the right to opt out of receiving prescreened solicitations, and shall provide the toll-free number the consumer can call to exercise that right. The short notice also shall direct the consumer to the existence and location of the long notice, and shall state the heading for the long notice. The short notice shall not contain any other information.
( ii ) *Form.* The short notice shall be: ( A ) In a type size that is larger than the type size of the principal text on the same page, but in no event smaller than 12 point type, or if provided by electronic means, then reasonable steps shall be taken to ensure that the type size is larger than the type size of the principal text on the same page;
( B ) On the front side of the first page of the principal promotional document in the solicitation, or, if provided electronically, on the same page and in close proximity to the principal marketing message;
( C ) Located on the page and in a format so that the statement is distinct from other text, such as inside a border; and
( D ) In a type style that is distinct from the principal type style used on the same page, such as bolded, italicized, underlined, and/or in a color that contrasts with the color of the principal text on the page, if the solicitation is in more than one color.
( 2 ) *Long notice.* The long notice shall be a clear and conspicuous, and simple and easy to understand statement as follows: ( i ) *Content.* The long notice shall state the information required by section 615(d) of the Fair Credit Reporting Act (15 U.S.C. 1681m(d)). The long notice shall not include any other information that interferes with, detracts from, contradicts, or otherwise undermines the purpose of the notice.
( ii ) *Form.* The long notice shall: ( A ) Appear in the solicitation;
( B ) Be in a type size that is no smaller than the type size of the principal text on the same page, and, for solicitations provided other than by electronic means, the type size shall in no event be smaller than 8 point type;
( C ) Begin with a heading in capital letters and underlined, and identifying the long notice as the “PRESCREEN&OPT-OUT NOTICE;”
( D ) Be in a type style that is distinct from the principal type style used on the same page, such as bolded, italicized, underlined, and/or in a color that contrasts with the color of the principal text on the page, if the solicitation is in more than one color; and
( E ) Be set apart from other text on the page, such as by including a blank line above and below the statement, and by indenting both the left and right margins from other text on the page.