EXHIBIT 1 
Page 1385 TITLE 15—COMMERCE AND TRADE § 1681m

(f) Prohibition on sale or transfer of debt caused

by identity theft

(1) In general

No person shall sell, transfer for consideration, or place for collection a debt that such

person has been notified under section 1681c–2

of this title has resulted from identity theft.

(2) Applicability

The prohibitions of this subsection shall

apply to all persons collecting a debt described

in paragraph (1) after the date of a notification under paragraph (1).

(3) Rule of construction

Nothing in this subsection shall be construed to prohibit—

(A) the repurchase of a debt in any case in

which the assignee of the debt requires such

repurchase because the debt has resulted

from identity theft;

(B) the securitization of a debt or the

pledging of a portfolio of debt as collateral

in connection with a borrowing; or

(C) the transfer of debt as a result of a

merger, acquisition, purchase and assumption transaction, or transfer of substantially

all of the assets of an entity.

(g) Debt collector communications concerning

identity theft

If a person acting as a debt collector (as that

term is defined in subchapter V of this chapter)

on behalf of a third party that is a creditor or

other user of a consumer report is notified that

any information relating to a debt that the person is attempting to collect may be fraudulent

or may be the result of identity theft, that person shall—

(1) notify the third party that the information may be fraudulent or may be the result of

identity theft; and

(2) upon request of the consumer to whom

the debt purportedly relates, provide to the

consumer all information to which the consumer would otherwise be entitled if the consumer were not a victim of identity theft, but

wished to dispute the debt under provisions of

law applicable to that person.

(h) Duties of users in certain credit transactions

(1) In general

Subject to rules prescribed as provided in

paragraph (6), if any person uses a consumer

report in connection with an application for,

or a grant, extension, or other provision of,

credit on material terms that are materially

less favorable than the most favorable terms

available to a substantial proportion of consumers from or through that person, based in

whole or in part on a consumer report, the person shall provide an oral, written, or electronic notice to the consumer in the form and

manner required by regulations prescribed in

accordance with this subsection.

(2) Timing

The notice required under paragraph (1) may

be provided at the time of an application for,

or a grant, extension, or other provision of,

credit or the time of communication of an approval of an application for, or grant, extension, or other provision of, credit, except as

provided in the regulations prescribed under

paragraph (6).

(3) Exceptions

No notice shall be required from a person

under this subsection if—

(A) the consumer applied for specific material terms and was granted those terms, unless those terms were initially specified by

the person after the transaction was initiated by the consumer and after the person

obtained a consumer report; or

(B) the person has provided or will provide

a notice to the consumer under subsection

(a) of this section in connection with the

transaction. 

(4) Other notice not sufficient

A person that is required to provide a notice

under subsection (a) of this section cannot

meet that requirement by providing a notice

under this subsection.

(5) Content and delivery of notice

A notice under this subsection shall, at a

minimum— 

(A) include a statement informing the consumer that the terms offered to the consumer are set based on information from a

consumer report;

(B) identify the consumer reporting agency furnishing the report;

(C) include a statement informing the consumer that the consumer may obtain a copy

of a consumer report from that consumer reporting agency without charge; and

(D) include the contact information specified by that consumer reporting agency for

obtaining such consumer reports (including

a toll-free telephone number established by

the agency in the case of a consumer reporting agency described in section 1681a(p) of

this title).

(6) Rulemaking

(A) Rules required

The Commission and the Board shall jointly prescribe rules.

(B) Content

Rules required by subparagraph (A) shall

address, but are not limited to—

(i) the form, content, time, and manner

of delivery of any notice under this subsection;

(ii) clarification of the meaning of terms

used in this subsection, including what

credit terms are material, and when credit

terms are materially less favorable;

(iii) exceptions to the notice requirement under this subsection for classes of

persons or transactions regarding which

the agencies determine that notice would

not significantly benefit consumers;

(iv) a model notice that may be used to

comply with this subsection; and

(v) the timing of the notice required

under paragraph (1), including the circumstances under which the notice must be

provided after the terms offered to the

consumer were set based on information

from a consumer report.
§ 1681m TITLE 15—COMMERCE AND TRADE Page 1386

(7) Compliance

A person shall not be liable for failure to

perform the duties required by this section if,

at the time of the failure, the person maintained reasonable policies and procedures to

comply with this section.

(8) Enforcement

(A) No civil actions

Sections 1681n and 1681o of this title shall

not apply to any failure by any person to

comply with this section.

(B) Administrative enforcement

This section shall be enforced exclusively

under section 1681s of this title by the Federal agencies and officials identified in that

section. 

(Pub. L. 90–321, title VI, §615, as added Pub. L.

91–508, title VI, §601, Oct. 26, 1970, 84 Stat. 1133;

amended Pub. L. 104–208, div. A, title II, §2411,

Sept. 30, 1996, 110 Stat. 3009–443; Pub. L. 108–159,

title I, §§114, 154(b), 155, title II, §213(a), title III,

§311(a), title VIII, §811(h), Dec. 4, 2003, 117 Stat.

1960, 1967, 1978, 1988, 2012; Pub. L. 111–203, title X,

§§1088(a)(2)(C), (7)–(9), 1100F, July 21, 2010, 124

Stat. 2087, 2088, 2112; Pub. L. 111–319, §2(a), Dec.

18, 2010, 124 Stat. 3457.)

AMENDMENT OF SECTION

Pub. L. 111–203, title X, §§1088(a)(2)(C),

(7)–(9), 1100F, 1100H, July 21, 2010, 124 Stat.

2087, 2088, 2112, 2113, provided that, effective on

the designated transfer date, this section is

amended as follows:

(1) by striking ‘‘the Commission’’ each place

that term appears, other than in subsection (e),

and inserting ‘‘the Bureau’’;

(2) in subsection (a)—

(A) by redesignating paragraphs (2) and (3)

as paragraphs (3) and (4), respectively;

(B) by inserting after paragraph (1) the following:

‘‘(2) provide to the consumer written or electronic disclosure—

‘‘(A) of a numerical credit score as defined in

section 1681g(f)(2)(A) of this title used by such

person in taking any adverse action based in

whole or in part on any information in a consumer report; and

‘‘(B) of the information set forth in subparagraphs (B) through (E) of section 1681g(f)(1) of

this title;’’; and

(C) in paragraph (4) (as so redesignated), by

striking ‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’;

(3) in subsection (d)(2)(B), by striking ‘‘the

Federal banking agencies’’ and inserting ‘‘the

Federal Trade Commission, the Federal banking

agencies,’’; 

(4) in subsection (e)(1), by striking ‘‘and the

Commission’’ and inserting ‘‘the Federal Trade

Commission, the Commodity Futures Trading

Commission, and the Securities and Exchange

Commission’’; 

(5) in subsection (h)(5)—

(A) in subparagraph (C), by striking ‘‘; and’’

and inserting a semicolon;

(B) in subparagraph (D), by striking the period and inserting ‘‘; and’’; and

(C) by inserting at the end the following:

‘‘(E) include a statement informing the consumer of—

‘‘(i) a numerical credit score as defined in

section 1681g(f)(2)(A) of this title, used by

such person in making the credit decision described in paragraph (1) based in whole or in

part on any information in a consumer report;

and 

‘‘(ii) the information set forth in subparagraphs (B) through (E) of section 1681g(f)(1)

of this title.’’; and

(6) in subsection (h)(6), by striking subparagraph (A) and inserting the following:

‘‘(A) Rules required

‘‘The Bureau shall prescribe rules to carry

out this subsection.’’

See Effective Date of 2010 Amendment note

below. 

AMENDMENTS

2010—Subsec. (e)(4). Pub. L. 111–319 added par. (4).

2003—Subsec. (d)(2). Pub. L. 108–159, §213(a), amended

heading and text of par. (2) generally. Prior to amendment, text read as follows: ‘‘A statement under paragraph (1) shall include the address and toll-free telephone number of the appropriate notification system

established under section 1681b(e) of this title.’’

Subsec. (e). Pub. L. 108–159, §811(h), repealed Pub. L.

104–208, §2411(c). See 1996 Amendment note below.

Pub. L. 108–159, §114, added subsec. (e) and struck out

former subsec. (e) designation that had been added with

no heading or text by Pub. L. 104–208, §2411(c). See note

above and 1996 Amendment note below.

Subsec. (f). Pub. L. 108–159, §154(b), added subsec. (f).

Subsec. (g). Pub. L. 108–159, §155, added subsec. (g).

Subsec. (h). Pub. L. 108–159, §311(a), added subsec. (h).

1996—Subsec. (a). Pub. L. 104–208, §2411(a), inserted

heading and amended text of subsec. (a) generally.

Prior to amendment, text read as follows: ‘‘Whenever

credit or insurance for personal, family, or household

purposes, or employment involving a consumer is denied or the charge for such credit or insurance is increased either wholly or partly because of information

contained in a consumer report from a consumer reporting agency, the user of the consumer report shall

so advise the consumer against whom such adverse action has been taken and supply the name and address

of the consumer reporting agency making the report.’’

Subsec. (b). Pub. L. 104–208, §2411(e), inserted subsec.

heading, designated existing provisions as par. (1) and

inserted heading, and added par. (2).

Subsec. (c). Pub. L. 104–208, §2411(d), substituted ‘‘this

section’’ for ‘‘subsections (a) and (b) of this section’’.

Subsec. (d). Pub. L. 104–208, §2411(b), added subsec. (d).

Subsec. (e). Pub. L. 104–208, §2411(c), which added subsec. (e) containing subsec. designation, but no heading

or text, was repealed by Pub. L. 108–159, §811(h).

EFFECTIVE DATE OF 2010 AMENDMENT

Pub. L. 111–319, §2(b), Dec. 18, 2010, 124 Stat. 3458, provided that: ‘‘The amendment made by this section

[amending this section] shall become effective on the

date of enactment of this Act [Dec. 18, 2010].’’

Amendment by Pub. L. 111–203 effective on the designated transfer date, see section 1100H of Pub. L.

111–203, set out as a note under section 552a of Title 5,

Government Organization and Employees.

EFFECTIVE DATE OF 2003 AMENDMENT

Amendment by Pub. L. 108–159 subject to joint regulations establishing effective dates as prescribed by

Federal Reserve Board and Federal Trade Commission,

except as otherwise provided, see section 3 of Pub. L.

108–159, set out as a note under section 1681 of this title.
Page 1387 TITLE 15—COMMERCE AND TRADE § 1681n

EFFECTIVE DATE OF 1996 AMENDMENT

Amendment by Pub. L. 104–208 effective 365 days after

Sept. 30, 1996, with special rule for early compliance,

see section 2420 of Pub. L. 104–208, set out as a note

under section 1681a of this title.

REGULATIONS

Pub. L. 108–159, title II, §213(b), Dec. 4, 2003, 117 Stat.

1979, provided that: ‘‘Regulations required by section

615(d)(2) of the Fair Credit Reporting Act [15 U.S.C.

1681m(d)(2)], as amended by this section, shall be issued

in final form not later than 1 year after the date of enactment of this Act [Dec. 4, 2003].’’

§ 1681n. Civil liability for willful noncompliance

(a) In general

Any person who willfully fails to comply with

any requirement imposed under this subchapter

with respect to any consumer is liable to that

consumer in an amount equal to the sum of—

(1)(A) any actual damages sustained by the

consumer as a result of the failure or damages

of not less than $100 and not more than $1,000;

or 

(B) in the case of liability of a natural person for obtaining a consumer report under

false pretenses or knowingly without a permissible purpose, actual damages sustained by

the consumer as a result of the failure or

$1,000, whichever is greater;

(2) such amount of punitive damages as the

court may allow; and

(3) in the case of any successful action to enforce any liability under this section, the

costs of the action together with reasonable

attorney’s fees as determined by the court.

(b) Civil liability for knowing noncompliance

Any person who obtains a consumer report

from a consumer reporting agency under false

pretenses or knowingly without a permissible

purpose shall be liable to the consumer reporting agency for actual damages sustained by the

consumer reporting agency or $1,000, whichever

is greater.

(c) Attorney’s fees

Upon a finding by the court that an unsuccessful pleading, motion, or other paper filed in connection with an action under this section was

filed in bad faith or for purposes of harassment,

the court shall award to the prevailing party attorney’s fees reasonable in relation to the work

expended in responding to the pleading, motion,

or other paper.

(d) Clarification of willful noncompliance

For the purposes of this section, any person

who printed an expiration date on any receipt

provided to a consumer cardholder at a point of

sale or transaction between December 4, 2004,

and June 3, 2008, but otherwise complied with

the requirements of section 1681c(g) of this title

for such receipt shall not be in willful noncompliance with section 1681c(g) of this title by

reason of printing such expiration date on the

receipt. 

(Pub. L. 90–321, title VI, § 616, as added Pub. L.

91–508, title VI, §601, Oct. 26, 1970, 84 Stat. 1134;

amended Pub. L. 104–208, div. A, title II,

§2412(a)–(c), (e)(1), Sept. 30, 1996, 110 Stat.

3009–446; Pub. L. 110–241, §3(a), June 3, 2008, 122

Stat. 1566.)

AMENDMENTS

2008—Subsec. (d). Pub. L. 110–241 added subsec. (d).

1996—Subsec. (a). Pub. L. 104–208, §2412(a), designated

existing provisions as subsec. (a), inserted heading, and

in introductory provisions substituted ‘‘Any person

who’’ for ‘‘Any consumer reporting agency or user of

information which’’.

Subsec. (a)(1). Pub. L. 104–208, §2412(b), amended par.

(1) generally. Prior to amendment, par. (1) read as follows: ‘‘any actual damages sustained by the consumer

as a result of the failure;’’.

Subsec. (b). Pub. L. 104–208, §2412(c), added subsec. (b).

Subsec. (c). Pub. L. 104–208, §2412(e)(1), added subsec.

(c). 

EFFECTIVE DATE OF 1996 AMENDMENT

Amendment by Pub. L. 104–208 effective 365 days after

Sept. 30, 1996, with special rule for early compliance,

see section 2420 of Pub. L. 104–208, set out as a note

under section 1681a of this title.

CONSTRUCTION

Pub. L. 108–159, title III, §312(f), Dec. 4, 2003, 117 Stat.

1993, provided that: ‘‘Nothing in this section, the

amendments made by this section, or any other provision of this Act [see Short Title of 2003 Amendment

note set out under section 1601 of this title] shall be

construed to affect any liability under section 616 or 617

of the Fair Credit Reporting Act (15 U.S.C. 1681n, 1681o)

that existed on the day before the date of enactment of

this Act [Dec. 4, 2003].’’

STATEMENT OF FINDINGS AND PURPOSE FOR 2008 

AMENDMENT

Pub. L. 110–241, §2, June 3, 2008, 122 Stat. 1565, provided that:

‘‘(a) FINDINGS.—The Congress finds as follows:

‘‘(1) The Fair and Accurate Credit Transactions Act

[of 2003] (commonly referred to as ‘FACTA’) [Pub. L.

108–159, see Short Title of 2003 Amendment note set

out under section 1601 of this title] was enacted into

law in 2003 and 1 of the purposes of such Act is to prevent criminals from obtaining access to consumers’

private financial and credit information in order to

reduce identity theft and credit card fraud.

‘‘(2) As part of that law, the Congress enacted a requirement, through an amendment to the Fair Credit

Reporting Act [15 U.S.C. 1681 et seq.], that no person

that accepts credit cards or debit cards for the transaction of business shall print more than the last 5

digits of the card number or the expiration date upon

any receipt provided to the card holder at the point

of the sale or transaction.

‘‘(3) Many merchants understood that this requirement would be satisfied by truncating the account

number down to the last 5 digits based in part on the

language of the provision as well as the publicity in

the aftermath of the passage of the law.

‘‘(4) Almost immediately after the deadline for

compliance passed, hundreds of lawsuits were filed alleging that the failure to remove the expiration date

was a willful violation of the Fair Credit Reporting

Act even where the account number was properly

truncated. 

‘‘(5) None of these lawsuits contained an allegation

of harm to any consumer’s identity.

‘‘(6) Experts in the field agree that proper truncation of the card number, by itself as required by the

amendment made by the Fair and Accurate Credit

Transactions Act [of 2003], regardless of the inclusion

of the expiration date, prevents a potential fraudster

from perpetrating identity theft or credit card fraud.

‘‘(7) Despite repeatedly being denied class certification, the continued appealing and filing of these

lawsuits represents a significant burden on the hundreds of companies that have been sued and could

well raise prices to consumers without corresponding

consumer protection benefit.

‘‘(b) PURPOSE.—The purpose of this Act [amending

this section and enacting provisions set out as notes