T
This report is available on the internet at www.ftc.gov/os/statutes/fcrajump.shtm. 

The online version of this report contains live hyperlinks.
July 2011 | Federal Trade Commission
40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

Contents

Staff Report 

Introduction 1

Evolution of the Fair Credit Reporting Act 2

FTC Enforcement of the FCRA 3

FTC’s Regulatory and Interpretive Roles 5

FTC Staff Summary and Relationship to 1990 Commentary 7

Other Significant Interpretations in the FTC Staff Summary 12

Summary of Interpretations 

Overview 17

Reference to multiple sections 17

Summary references to FCRA 17

Terminology 17

Citations to FACT Act rules 18

Section 601 – Short Title 19

Section 602 – Findings and Purpose 19

Section 603 – Definitions and Rules of Construction 19

Section 604 – Permissible Purposes of Reports 40

Section 605 – Requirements Relating to Information Contained in 

 Consumer Reports 55

Section 605A – Identity Theft Prevention; Fraud Alerts and Active Duty Alerts 60

Section 605B – Block of Information Resulting From Identity Theft 61

Section 606 – Disclosure of Investigative Consumer Reports 62

Section 607 – Compliance Procedures 64

Section 608 – Disclosures to Governmental Agencies 70

Section 609 – Disclosures to Consumers 70

Section 610 – Conditions and Form of File Disclosure to Consumer 74

Section 611– Procedure in Case of Disputed Accuracy 75
AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

Section 612 – Charges for Certain Disclosures 79

Section 613 – Public Record Information for Employment Purposes 81

Section 614 – Restrictions on Investigative Consumer Reports 82

Section 615 – Requirements on Users of Consumer Reports 82

Sections 616-617 – Civil Liability for Negligent or Willful Noncompliance 89

Section 618 – Jurisdiction of Courts; Limitation of Actions 89

Section 619 – Obtaining Information Under False Pretenses 89

Section 620 – Unauthorized Disclosures by Officers or Employees 89

Section 621 – Administrative Enforcement 89

Section 622 – Information on Overdue Child Support Obligations 91

Section 623 – Duties of Furnishers of Information to CRAs 92

Section 624 – Affiliate Marketing 97

Section 625 – Relation to State Laws 97

Section 626 – Disclosures to FBI for Counterintelligence Purposes 97

Section 627 – Disclosures to Governmental Agencies for Counterterrorism 

 Purposes 98

Section 628 – Disposal of Records 98

Section 629 – Corporate and Technological Circumvention Prohibited 98

1990 Comments not incorporated into 2011 Summary 99

Endnotes 100

List of FTC FCRA Cases 108
40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

I. Introduction

The Fair Credit Reporting Act1 (“FCRA”) governs the collection, assembly, and use of consumer 

report information and provides the framework for the credit reporting system in the United 

States. The FCRA was enacted in 1970, and it has been amended several times in the ensuing 

years. The two most extensive amendments were the Consumer Credit Reporting Reform Act 

of 1996 (the “1996 amendments”)2 and the Fair and Accurate Credit Transactions Act of 2003 

(“FACT Act”).3

The FCRA regulates the practices of consumer reporting agencies (“CRAs”) that collect and 

compile consumer information into consumer reports for use by credit grantors, insurance 

companies, employers, landlords, and other entities in making eligibility decisions affecting 

consumers. Information included in consumer reports generally may include consumers’ credit 

history and payment patterns, as well as demographic and identifying information4 and public 

record information (e.g., arrests, judgments, and bankruptcies). Consumer report information 

may be used by entities to predict the risk of future nonpayment, default, or other adverse events. 

The FCRA was enacted to (1) prevent the misuse of sensitive consumer information by limiting 

recipients to those who have a legitimate need for it; (2) improve the accuracy and integrity of 

consumer reports; and (3) promote the efficiency of the nation’s banking and consumer credit 

systems.

As described below, since its initial passage in 1970, the Federal Trade Commission (“FTC” 

or “Commission”) has played a key role in the implementation, oversight, enforcement, and 

interpretation of the FCRA. Under the Consumer Financial Protection Act of 2010 (“CFPA”),5

the FTC retains its enforcement role but will share that role in many respects with the newlycreated Consumer Financial Protection Bureau (“CFPB”). The CFPB also will take on primary 

1. 15 U.S.C. § 1681 et seq. The FCRA’s provisions are sections 601-629 of the Consumer Credit Protection Act 

and are commonly cited by those section numbers. The full text of the FCRA, as published on the Commission 

website, uses both citation forms. 

2. Title II, Subtitle D, Chapter 1, of the Omnibus Consolidated Appropriations Act for Fiscal Year 1997 (Pub. L. 

No. 104-208, Sept. 30, 1996).

3. Pub. L. No. 108-159 (Dec. 4, 2003).

4. The demographic and identifying information (e.g., name, address) generally is not considered “consumer 

report” information under the FCRA, unless it is used for eligibility determinations. See In re Trans Union 

Corp., 2000 FTC LEXIS 23 (2000), aff’d sub nom. Trans Union Corp. v. FTC, 245 F.3d 809, reh. denied, 267 

F.3d 1138 (D.C. Cir. 2001), cert. denied, 122 S. Ct. 2386 (2002); FTC v. TRW, Inc., Civil No. 3-91-CV2661-H 

(N.D. Tex. 1993) (consent decree); Dotzler v. Perot, 914 F. Supp. 328 (E.D. Mo. 1996). If a CRA obtains 

demographic and identifying information from a financial institution, however, any redisclosure of that 

information is subject to the privacy restrictions of the Gramm-Leach-Bliley Act, 15 U.S.C. § 6801 et seq. 

5. Title X of Pub. L. 111-203 (Dodd-Frank Wall Street Reform and Consumer Protection Act).
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

regulatory and interpretive roles under the FCRA. As the FTC role evolves, the staff seeks 

to share its extensive experience with the CFPB and the public through a summary of its key 

interpretations and guidance. The following report gives a brief overview of the FTC’s role in 

the enforcement and the interpretation of the FCRA, followed by an FTC Staff Summary of 

Interpretations of the FCRA (“Staff Summary”) in a section-by-section format.6 Commission 

staff anticipates that this report and the Staff Summary will be of aid to the CFPB as it takes over 

many of the interpretive functions under the FCRA as of July 21, 2011.

II. Evolution of the Fair Credit Reporting Act 

When it was originally enacted, the FCRA imposed requirements exclusively on CRAs such as 

credit bureaus, except for those sections of the Act requiring users of consumer reports and other 

third parties to provide certain notices to consumers. The FCRA established the Commission as 

the primary federal enforcement agency, with jurisdiction over CRAs and all consumer report 

users (e.g., retailers, finance companies, employers, insurers, and landlords), except for certain 

entities over which the Commission does not have jurisdiction.7 Under the FCRA, CRAs are 

required to establish procedures to ensure that they report consumer information only to those 

with a legitimate purpose for it and to achieve maximum possible accuracy in the information 

they report. The FCRA further sought to improve the accuracy of data in CRA files by requiring 

CRAs to disclose information in their files to consumers and investigate items disputed in good 

faith by them.

The Consumer Credit Reporting Reform Act of 19968 made extensive revisions to the FCRA 

(the “1996 Amendments”) in a number of areas. First, it expanded the duties of CRAs, 

particularly in regard to CRA responses to consumers’ disputes – establishing a 30-day time 

frame for completion of an investigation, mandating written notice to the consumer of the 

results of the investigation within five days of its completion, and adding restrictions on the 

reinsertion of items that were deleted following a dispute. The 1996 Amendments also increased 

the obligations of users of consumer reports, particularly employers. Most significantly, the 

1996 Amendments imposed duties on a class of entities not previously treated by the FCRA 

6. Given the complexity of the statute and the volume of private litigation, the Staff Summary is not intended to 

be a complete compendium of the extensive case law that has developed under the FCRA. Rather, the Staff 

Summary focuses on the interpretations developed either in response to specific questions or fact patterns 

presented by industry, or through enforcement actions brought by the FTC. 

7. The primary exceptions are federally regulated financial institutions. Section 621(a)-(b). 

8. Title II, Subtitle D, Chapter 1, of the Omnibus Consolidated Appropriations Act for Fiscal Year 1997 (Pub. L. 

104-208, Sept. 30, 1996).
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

– furnishers of information to CRAs – by including requirements related to accuracy and the 

handling of disputes by the entities that provided information to CRAs. 

The ensuing seven years brought a number of more modest revisions, the most significant of 

which was a 1999 amendment that specifically authorized the Board of Governors of the Federal 

Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the 

Currency, Office of Thrift Supervision, and National Credit Union Administration (collectively 

the “federal financial agencies” or “Agencies”) to promulgate regulations under the FCRA for the 

banks and other entities subject to their jurisdiction.9

The FACT Act10 was Congress’ second major expansion of the FCRA. It added several sections 

to assist consumers and businesses in combating identity theft and reducing the damage to 

consumers when that crime occurred. The FACT Act established a national fraud alert system, 

required merchants to truncate account numbers on electronic credit/debit card receipts, and 

ordered agencies to promulgate rules on proper disposition of consumer report information 

and on what companies should do to respond to the “red flag” indicators of identity theft. In 

addition, it granted consumers the right to request free annual reports11 from national CRAs, 

required “blocking” of information placed on a consumer report as a result of identity theft, and 

required businesses to provide copies of relevant business records to identity theft victims. The 

Commission, often in conjunction with the federal financial agencies, issued numerous rules to 

implement the various FACT Act provisions.12

III. FTC Enforcement of the FCRA

The FCRA is enforced at the federal and state levels, as well as through private litigation. At the 

federal level, the FTC and the federal financial agencies have enforced the FCRA as to entities 

over which they have jurisdiction.13 FCRA violations by FTC-regulated entities are considered to 

be unfair or deceptive practices and are subject to the remedies provided by Section 5 of the FTC 

9. Section 506 of the Gramm-Leach-Bliley Act (Pub. L. 106-102; codified at FCRA § 621(e)). 

10. Pub. L. 108-159 (Dec. 4, 2003). See footnote 3, supra. 

11. The FACT Act added a new section 612(a) to the FCRA, requiring nationwide CRAs to provide consumers 

with one free disclosure of the information in their files on request. This is commonly called the “free annual 

report” requirement. We use the legal term “free annual file disclosure” in our interpretations.

12. The Commission’s FACT Act rules are listed on the agency website, available at

http://www.ftc.gov/os/statutes/fcrajump.shtm.

13. Section 621. In general, the banking agencies have jurisdiction over the financial institutions they oversee and 

the FTC has jurisdiction over CRAs and all other persons. The CFPA adds the CFPB as an enforcement agency 

under the FCRA, effective July 21, 2011.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

Act.14 The FTC may request injunctive and ancillary relief administratively or through federal 

district courts.15 The FTC also is empowered to file civil actions in federal court to recover civil 

penalties of up to $3,500 per violation, “in the event of a knowing violation, which constitutes 

a pattern or practice of violations.”16 In a federal court action, the FTC also may seek monetary 

relief in the form of redress or disgorgement and other equitable relief, based on the court’s 

equitable powers.17

During its 40-year history of enforcing the FCRA, the FTC has brought 87 enforcement actions 

against CRAs, users of consumer reports, and furnishers of information to CRAs.18 As noted 

above, the FCRA originally was focused on CRAs and those entities that used consumer reports. 

As a result, the Commission has extensive enforcement experience against CRAs and users of 

consumer reports. For example, the Commission has brought a number of cases against CRAs 

to ensure that consumer reports are only supplied to those with a permissible purpose.19 The 

14. Section 621(a)(1).

15. Section 621(a); see also 15 U.S.C. §§ 41 et seq.

16. The amount set forth in the text, as enacted in 1996, is $2,500 per knowing violation. Section 621(a)(2)(A). 

Pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990, the Commission increased the amount 

to $3,500 per violation, effective February 9, 2009. See 74 Fed. Reg. 857 (Jan. 9, 2009). In determining the 

amount of the penalties, courts must take into account the degree of culpability, any history of similar conduct, 

ability to pay, the effect on ability to continue to do business, and such other matters as justice may require. 

See section 621(a)(2)(B). Examples of FTC civil penalty cases include United States v. ChoicePoint, Inc., No. 

1:06cv198 (N.D. Ga. 2006) (consent order) ($10 million civil penalty); United States v. Performance Capital 

Management, Inc., No. 01-01047TJH (C.D. Cal. 2001) (consent order) ($2 million civil penalty, suspended); 

United States v. NCO Group, Inc., et al., No. 2:04W2041 (E.D. Pa. 2004) (consent decree) ($1.5 million civil 

penalty); United States v. Rental Research Services, Inc., No. 0:09-cv-00524 (D. Minn. 2009) (consent order) 

($500,000 penalty, suspended) .

17. See United States v. ChoicePoint, Inc., No. 1:06cv198 (N.D. Ga. 2006) (consent order) (up to $5 million in 

consumer redress).

18. A list of the FTC’s enforcement cases can be found appended to this report.

19. E.g., Equifax Credit Information Services, Inc., 130 F.T.C. 577 (1995) (consent order); Trans Union Corp., 

116 F.T.C. 1357 (1993) (consent order); Trans Union Corp. v. FTC, 81 F.3d 228 (D.C. Cir. 1996); FTC v. TRW 

Inc., 784 F. Supp. 361 (N.D. Tex. 1991) (consent decree); Trans Union Corp., 102 F.T.C. 1109 (1983) (consent 

order). In its case against ChoicePoint, Inc., a data broker and CRA, the FTC alleged that the defendant 

furnished credit reports to identity thieves posing as ChoicePoint subscribers. The complaint alleged that 

ChoicePoint violated the FCRA by providing consumer reports to persons who did not have a permissible 

purpose to obtain them and by failing to maintain reasonable procedures to verify both the recipients’ identities 

and how they intended to use the information. In settling the case, ChoicePoint agreed to pay $10 million 

in civil penalties – at the time, the largest civil penalty in FTC history – and to provide up to $5 million for 

redress to identity theft victims. See United States v. ChoicePoint, Inc., No. 1:06cv198 (N.D. Ga. Feb. 15, 

2006) (consent order). The Order establishes specific procedures that ChoicePoint must follow to ensure that 

they provide consumer reports only to those with a permissible purpose. Id.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

Commission also has enforced these requirements against resellers of consumer reports.20 In 

addition, the FTC has brought several enforcement actions against users that failed to provide 

adverse action notices when required, including creditors21 and employers.22

Following the adoption of the 1996 Amendments, the FTC brought actions against businesses 

that furnish information to CRAs, primarily debt collectors and mortgage servicers.23 In many 

cases, the FTC has enforced important FCRA requirements together with related requirements 

under the Fair Debt Collection Practices Act (“FDCPA”), the Equal Credit Opportunity Act 

(“ECOA”), and Section 5 of the FTC Act.24

IV. FTC’s Regulatory and Interpretive Roles 

Prior to the FACT Act of 2003, the FTC lacked rulemaking authority under the FCRA. The 

FACT Act, however, provided the FTC with specific rulemaking authority in a number of areas. 

Some rules were the sole responsibility of the FTC, and others were to be carried out jointly or in 

20. E.g., Settlement One Credit Corp.; ACRAnet, Inc.; Fajilan and Associates, Inc. (public comment requested on 

three cases, Feb. 9, 2011; 76 Fed. Reg. 7213); W.D.I.A., 117 F.T.C. 757 (1994) (consent order); CDB Infotek, 

116 F.T.C. 280 (1993) (consent order); Inter-Fact, Inc., 116 F.T.C. 294 (1993) (consent order); I.R.S.C., 116 

F.T.C. 266 (1993) (consent order). 

21. See, e.g., United States v. Sprint Corp., Civ. No. 4:04ev 361RH (N.D. Fla. 2004) (consent decree) (telephone 

service provider failed to provide adverse action notices when conditioning receipt of service on advance 

deposit or maximum charge limits); United States v. AT&T Corp., Civ. No. 3:04-cv-04411-SRC-TJB (D.N.J. 

2004) (consent order) (same); see also Hospital & Health Services Credit Union, 104 F.T.C. 589 (1984) 

(consent order); Federated Department Stores, 106 F.T.C. 615 (1985) (consent order); United States v. Green 

Tree Acceptance, Civ. No. CA 4 86 469 K (M.D. Tex. 1988) (consent order); Quicken Loans Inc., 135 F.T.C. 

424 (2003) (consent order); United States v. Tower Loan of Mississippi, Civ. No. J90-0447 (J) (S.D. Miss. 

1991) (consent order); United States v. Capital City Mortgage, Civ. No. 1:98CV00237 (D.D.C. 2005).

22. See, e.g., United States v. Imperial Palace, Inc. CV-S-04-0963-RHH-PAL (D. Nev. 2004) (consent decree) 

(employer failed to provide adverse action notices when denying or rescinding offers of employment based 

on consumer report information); see also Electronic Data Systems, 114 F.T.C. 524 (1991) (consent order); 

McDonnell Douglas Corp., 115 F.T.C. 33 (1992) (consent order); Macy’s Northeast, Inc., 115 F.T.C. 43 (1992) 

(consent order). 

23. E.g., United States v. DC Credit Services, Inc., Civ. No. 02-5115 (C.D. Cal. 2002) (consent decree) ($300,000 

civil penalty); United States v. Performance Capital Management, Inc., 2:01cv1047 (C.D. Cal. 2000) (consent 

decree)($2 million civil penalty); United States v. Fairbanks Capital Corp., Civ. No. 01-12219 (D. Mass. 2003)

(consent decree).

24. Several cases in the 1980s involved violations of both the FCRA and the ECOA. E.g., United States v. 

Winkleman Stores, Inc., Civ. No. 85-2214 (N.D. Ohio 1985); United States v. Strawbridge & Clothier, Inc., 

Civ. No. 85-6855 (E.D. Pa. 1985); United States v. Norwest, Inc., Civ. No. 87-6025 (C.D. Cal. 1987). The civil 

penalties in those cases resulted from the ECOA violations, because the Commission was not authorized to 

seek civil penalties for FCRA violations until 1996. Some more recent cases have involved violations of both 

the FCRA and the FDCPA. E.g., United States v. Credit Bureau Collection Services, Civ. No. 10-0169 (S.D. 

Ohio 2010). 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

coordination with one or more of the other agencies that enforce the FCRA.25 Under the CFPA, 

this rulemaking responsibility will transfer to the CFPB, with the exception of rules governing 

the proper disposal of consumer report information and the requirements that companies 

maintain a program to detect and address the “red flags” of identity theft. The CFPA provides 

that the FTC will continue to have rulemaking authority in those two discrete areas,26 as well as 

with respect to automobile dealers.27

Separate from the Commission’s rulemaking authority, Commission staff has offered extensive 

informal interpretation and guidance since the FCRA’s adoption in 1970, including the issuance 

of over 430 opinion letters28 and the publication of a staff compliance manual.29 Although staff 

opinion letters do not represent the formal policy or views of the Commission and are not 

binding, they provide important guidance on issues of statutory interpretation. Some courts have 

cited to staff letters to support their findings,30 although others have rejected them.31 In addition to 

the staff opinion letters, the Commission itself issued eight formal interpretations of the FCRA in 

the 1970s.32

Given the volume of formal and informal FCRA interpretations, in May 1990 the Commission 

created a consolidated, inclusive document that gathered together Commission guidance in 

25. For example, the FTC was given sole authority to promulgate rules implementing the free annual credit report 

and prescreen opt-out notice requirements. See Section 612(a) (annual credit report), 615(d)(2)(B) (prescreen 

opt-out notice). Examples of joint or coordinated rules include the risk-based pricing rule (jointly with the 

Federal Reserve), the disposal, furnisher accuracy, and identity theft red flags rules (coordinated with all of 

the federal financial agencies), and the furnisher direct dispute rule (jointly with all of the federal financial 

agencies). The FACT Act also imposed certain non-rulemaking obligations on the FTC, including, for example, 

the determination of a “fair and reasonable” fee for credit scores and the promulgation of notices of user and 

furnisher obligations. Section 609(f)(8). Other responsibilities were imposed on other FCRA agencies (e.g, the 

Federal Reserve Board was required to issue the model disclosure for furnishing negative information). Section 

623(a)(7)(D). Many of these responsibilities transfer to the CFPB effective July 21, 2011. CFPA § 1088(a)(2).

26. CFPA §1088(a)(2). 

27. CFPA §1029(a) and (d). 

28. See http://www.ftc.gov/os/statutes/fcra/index.htm for a compilation of FTC informal staff opinion letters dated 

June 27, 1997 and thereafter.

29. The manual (titled “Compliance with the Fair Credit Reporting Act”) was first published shortly after 

enactment and was last updated in March 1979.

30. E.g., Levine v. World Financial Network Nat’l Bank, 437 F.3d 1118, 1122 (11th Cir. 2006); Fischl v. General 

Motors Acceptance Corp., 708 F.2d 143, 147 (5th Cir. 1983).

31. E.g., Johnson v. Federal Express Corp., 147 F. Supp. 2d 1268, 1272 (M.D. Ala. 2001) (“The letters are not 

binding and not persuasive.”); Hartman v. Lisle Park District, 158 F. Supp. 2d 869, 876 (N.D. Ill. 2001).

32. 16 CFR §§ 600.1 through 600.8 (withdrawn in August 1990, contemporaneously with publication of the 

Commentary, described in footnote 33, infra).
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

a single source, its comprehensive Commentary on the FCRA (the “1990 Commentary”),33

providing broad guidance on the Commission’s interpretation of the provisions of the FCRA.34

The Commentary had no binding effect, but some courts have accorded it weight as a policy 

statement of the primary agency responsible for enforcing the FCRA.35

V. FTC Staff Summary and Relationship to 1990 Commentary

Through the passage of time and the adoption of significant amendments to the FCRA, the 1990 

Commentary has become partially obsolete, and does not reflect the most current interpretive 

guidance on the FCRA. Prior to the passage of the CFPA, FTC staff had been working on an 

updated Commentary as a replacement for the 1990 Commentary. As a result of the CFPA, 

however, much of the authority of the Commission and the federal financial agencies to publish 

rules, regulations, or guidelines under the FCRA transfers to the CFPB. In this changed context, 

staff is instead publishing a compendium of interpretations that it believes will be of use to the 

CFPB staff, the businesses subject to the Commission’s jurisdiction under the FCRA, public 

representatives, and consumers. The Staff Summary incorporates material from the following 

sources:

• Interpretations from the 1990 Commentary on sections of the FCRA that have not been 

amended, which staff continues to believe are timely, accurate, and helpful; 

• Issues addressed in informal staff opinions issued after the 1990 Commentary, including 

post-1996 letters that appear on the Commission’s public web site; 

• Informal interpretations provided by staff not otherwise reflected in written staff opinions, 

typically in response to specific questions or fact patterns presented by industry;36 and 

• Commission enforcement actions, and rulemaking proceedings required by the FACT Act.

33. 55 Fed. Reg. 18804 (May 4, 1990). The 1990 Commentary was the culmination of a proposal published in 

August 1988 and the Commission’s review of over 100 submissions it received in response to its request for 

public comments on that proposal. 53 Fed. Reg. 29696 (Aug. 8, 1988). 

34. The Commission specified that the interpretations set forth in the 1990 Commentary were not trade regulation 

rules or regulations and, as provided in section 1.73 of the Commission’s rules, did not have the force or effect 

of statutory provisions. 

35. E.g., Davenport v. Farmers Ins. Group, 378 F. 3d 839, 843 (8th Cir. 2004); Estiverne v. Saks Fifth Avenue, 

9 F.3d 1171, 1173 (5th Cir. 1993). The FTC provides extensive guidance and assistance to the private sector 

and consumers on the requirements and protections of the FCRA. The FTC does outreach to the business 

community through presentations at industry meetings and conferences, informal advice, and published 

guidance materials.

36. It had been commonly assumed that the Commission would update the 1990 Commentary at some point. Thus, 

we continue to receive regular public input on various interpretations of the FCRA.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

At the same time the Commission is authorizing issuance of the Staff Summary, it is withdrawing 

its 1990 Commentary. Although the Summary incorporates certain of the Commentary 

interpretations verbatim, it also includes various changes. In an effort to streamline this 

Summary, staff does not include those interpretations from the 1990 Commentary that (1) related 

to sections of the FCRA that have been repealed or amended; (2) concerned enforcement by 

entities other than the FTC or the validity of state law; (3) duplicated other interpretations or 

were otherwise redundant; or (4) had become obsolete or outdated due to changes in technology, 

industry practices, or other developments.37 In addition, the interpretations in the Staff Summary 

differ from the 1990 Commentary in five significant areas, described below.

A. Departments of Motor Vehicles. Staff does not adopt the 1990 Commentary’s position that 

a Department of Motor Vehicles (“DMV”) providing motor vehicle reports for insurance 

underwriting purposes can be a “consumer reporting agency.”38 The 1990 Commentary 

(comments 603(d)-4C and 603(f)-10) stated that a motor vehicle report can be a “consumer 

report” and a DMV that sells such reports for insurance underwriting purposes can be 

a “consumer reporting agency.”39 Staff now believes that the prior interpretation was 

problematic, notwithstanding its well-intentioned goal to provide consumers with useful 

information. 

The Commission has never enforced the FCRA against any DMV or other government 

agency supplying public records. Although a theoretical argument can be made that such 

public agencies are CRAs based on a literal reading of the FCRA,40 this interpretation would 

37. For ease of reference, we have appended a chart of the 1990 Commentary interpretations that are not 

incorporated in the Staff Summary.

38. See 1990 comments 603(d)-4C and 603(f)-10.

39. Those comments essentially adopted a 1973 Commission interpretation (former 16 CFR § 600.4), which 

resulted from a practical concern that consumers would not be entitled to adverse action notices from insurers 

taking action on motor vehicle reports if DMVs were not considered CRAs. 38 Fed. Reg. 4945, 4946-47 

(Feb. 23, 1973). The Commission stated that the interpretation did not apply to any reports by DMVs for law 

enforcement or licensing purposes, for which there would generally not otherwise exist a permissible purpose 

for the DMV (treated as a CRA) to provide the information. The 1990 Commentary retained the interpretation 

in the face of negative reaction from an appreciable number of public commenters, primarily because no 

practical problems had arisen over the 17 years the predecessor interpretation had been effective. 55 Fed. Reg. 

18804, 18806 (May 4, 1990).

40. Section 603(f) states: 

The term “consumer reporting agency” means any person which, for monetary fees, dues, or on a cooperative 

nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer 

credit information or other information on consumers for the purpose of furnishing consumer reports to third 

parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing 

consumer reports.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

lead to absurd results. If DMVs or other government sources of public record information 

were CRAs, a news reporter could not access public information about individuals because 

he or she would not have a permissible purpose under the FCRA. Government agencies 

would be required to suppress accurate public record information more than seven years 

old.41 Those who provide information for use in public records – such as police officers – 

would be deemed furnishers, subject to a host of responsibilities under the FCRA. 

Several staff opinion letters subsequent to the 1990 Commentary have addressed the 

application of the FCRA to state agencies providing public record data to third parties. In 

response to inquiries concerning the applicability of the FCRA to employers who procure 

data from a Highway Patrol,42 a Department of Public Investigation,43 and a Department of 

Public Safety,44 the staff concluded in each case that the entity was not a CRA.45 Similarly, 

the staff believes that the DMV should not be considered a CRA. 

The fact that a DMV may charge a fee to obtain access to the records it maintains does 

not change the analysis. Many government entities charge fees associated with access to 

government records that are used for eligibility purposes, the most notable example of 

which is the federal court system. Through its Public Access to Court Electronic Records 

(PACER) site, the federal court system provides centralized electronic access for a fee 

to court records, including access to bankruptcy filings, to “nearly one million PACER 

users includ[ing] attorneys, pro se filers, government agencies, trustees, data collectors, 

researchers, educational and financial institutions, commercial enterprises, the media, and 

the general public.”46 The fact that the court system provides access to its records for a fee, 

even to those entities that clearly would use such information for eligibility purposes – 

41. If criminal conviction records are involved, or the information was reported for a purpose excepted by Section 

605(b) (e.g., a job paying more than $75,000 per year), this restriction would not apply.

42. See Goeke, FTC Informal Staff Opinion Letter, June 9, 1998, available at

http://www.ftc.gov/os/statutes/fcra/goeke.htm.

43. See Copple, FTC Informal Staff Opinion Letter, June 10, 1998, available at

http://www.ftc.gov/os/statutes/fcra/copple.htm.

44. See Pickett, FTC Informal Staff Opinion Letter, June 10, 1998, available at

http://www.ftc.gov/os/statutes/fcra/pickett.htm.

45. Case law holding that the FBI is not a CRA when making similar reports strongly supports the conclusion that 

government agencies providing public records are not CRAs. Cf. Ricci v. Key Bancshares of Maine, Inc., 768 

F.2d 456, 466 (1st Cir. 1985); Ollestad v. Kelley, 573 F. 2d 1109, 1111 (9th Cir. 1978); see also Makas v. N.Y. 

State Dept. of Motor Vehicles, 1998 U.S. Dist. LEXIS 3840, at *5-6 (N.D.N.Y. 1998) (stating that the FCRA 

does not apply to the New York DMV because the statute only applies to “credit reporting agencies and users 

of information.”).

46. http://www.pacer.gov/
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

such as financial institutions – does not turn the federal court system into a CRA. For these 

reasons, the Staff Summary does not incorporate the 1990 Commentary interpretations with 

respect to DMVs.

B. Commercial transactions. The issue of whether and how the FCRA applies in the context 

of an application for business credit arises when a creditor that is considering a credit 

application from a small business wants to procure a credit report on the sole proprietor or 

other principal in the business. 

In staff opinion letters from 2000 and 2001, the Commission staff addressed this question.47 

Staff opined that (1) a report by a CRA is a “consumer report” even if it is used for 

commercial purposes; and (2) an application for business credit does not give rise to a 

permissible purpose except for a report on an individual who will be personally liable for 

the debt. Staff now adopts the interpretations expressed in these staff opinion letters, and 

deletes or modifies several interpretations in the 1990 Commentary to make them consistent 

with those views.

C. Joint users. From the inception of the FCRA, the Commission and other federal financial 

agencies have grappled with scenarios involving a lender that shares an applicant’s 

consumer report with another party, and the issue of whether the lender sharing the report 

becomes a CRA by doing so. FCRA guidance issued by the federal financial agencies 

answered this question in the negative where the lender and the second party (e.g., a 

loan insurer or guarantor) were involved in the same transaction, stating that the two 

were “joint users” in that situation.48 The 1990 Commentary similarly applied the “joint 

user” terminology to other situations where two users shared the same report for the 

same permissible purpose with the consumer’s consent, as well as to agent-principal and 

employer-employee sharing of consumer reports.49

The Staff Summary does not use the term “joint user” – a term that appears nowhere in the 

FCRA. Although the concept has proved a useful construct in the fact situations to which it 

has been applied in the past, it is not in accord with the precise analytical treatment that staff 

believes is appropriate. Further, consumer transactions have developed more complexity 

47. These letters, dated July 26, 2000 and June 22, 2001, can be found on the Commission website, available at 

http://www.ftc.gov/os/statutes/fcra/tatelbaum.htm and http://www.ftc.gov/os/statutes/fcra/tatelbaum2.htm.

48. Item 19 in “Questions and Answers About the Fair Credit Reporting Act” (May 1971, reissued and expanded in 

March 1994) CCH Cons. Cred. Guide ¶26,703. 

49. See 1990 comments 603(f)-8 and 607(b)-2B. A 1998 staff opinion letter adopts this view as well. See Throne, 

FTC Informal Staff Opinion Letter, Nov. 20, 1998, available at http://www.ftc.gov/os/statutes/fcra/throne.shtm.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

and often involve more intermediaries, causing the “joint user” concept to become more 

strained even as the need for a rationale to permit sharing among such parties becomes more 

apparent. 

The Staff Summary looks instead to whether the lender is sharing the report “for the purpose 

of providing consumer reports to third parties” in these cases, in which case the lender 

may become a CRA. If the party to whom the report is being provided merely effectuates a 

particular transaction initiated by the consumer, then that party is not “providing consumer 

reports to third parties.” In short, the Summary reaches the same result as the prior 

interpretations, without using the “joint user” terminology of 1990 comment 603(f)-8.

D. Identified information. The 1990 Commentary stated that “credit guides” – listings that 

rate how well consumers pay their bills – are generally consumer reports. However, the 

Commentary went on to note that such guides would not be considered consumer reports 

if they were coded by, for example, Social Security number, driver’s license number, or 

bank account number. As support, the Commentary stated that, “as long as the consumer’s 

identity is not disclosed, [these guides] are not ‘consumer reports’ until decoded.” Given 

advancements in technology and the public availability of a broad range of data about 

consumers, staff is concerned the examples of “coding” referenced in the 1990 Commentary 

– particularly coding based on Social Security numbers – could today lead to the disclosure 

of a consumer’s identity.50 For this reason, the Staff Summary clarifies that information may 

constitute a consumer report even if it does not identify the consumer by name if it could 

“otherwise reasonably be linked to the consumer.”

E. Address in adverse action notice. The 1990 Commentary (comment 615-12) interpreted the 

FCRA requirement that an adverse action notice contain (among other information) “the 

name and address of the consumer reporting agency making the report” to require disclosure 

of “the agency’s street address, not just a post office box.” The Staff Summary omits this 

comment.

50. Staff recently hosted a series of privacy roundtables, at which numerous panelists pointed to the blurring 

distinction between personally identifiable information and supposedly “anonymized” information. Protecting 

Consumer Privacy in an Era of Rapid Change, Preliminary FTC Staff Report, December 2010, at iv, 35-38, 

available at http://ftc.gov/os/2010/12/101201privacyreport.pdf. Similarly, in its report on the use of Social 

Security numbers in the private sector, the Commission noted that “SSNs are available from many sources, 

including public records ....” Security in Numbers: SSNs and ID Theft, FTC Report, December 2008, at p. 1, 

available at http://www.ftc.gov/os/2008/12/P075414ssnreport.pdf.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

When the FCRA was enacted in 1970, it was not uncommon for consumers to visit a local 

CRA for an in-person disclosure, and it made sense to interpret the “address” requirement as 

more than a post office box. Today, the consumer reporting industry is mostly concentrated, 

such that a CRA likely will not have an office close enough for most consumers to make 

a personal visit practical. In addition, for those dispute requests made by mail it may be 

more efficient for consumers to allow CRAs to designate a single P.O. Box to receive such 

requests. Thus, the Staff Summary would delete the 1990 Commentary’s requirement that 

adverse action notices include a street address, allowing CRAs to include instead a P.O. Box 

designated to receive disputes.

VI. Other Significant Interpretations in the FTC Staff Summary

The Staff Summary also reflects the statutory modifications made to the FCRA over the years,51

rules issued by the Commission and other Agencies as directed by the 2003 FACT Act, many of 

the interpretations reflected in the over 80 informal staff opinion letters issued over the last two 

decades,52 and the staff’s experience from significant enforcement actions. The Staff Summary 

notes, where appropriate, the related staff opinion letters and enforcement actions. The following 

are worthy of special note because they continue to generate a significant number of questions 

from the public.

A. Application of the FCRA to resellers of credit reports and sellers of software. The Staff 

Summary clarifies the application of the FCRA to resellers of credit reports as distinguished 

from sellers of software used to procure such reports, following the Commission’s 

enforcement actions in this area and a 1997 informal opinion letter. 

A 1999 consent order, involving the seller of a “merged” report (which combines 

information from two or three major CRAs), requires the respondent to comply with the 

duties that the FCRA imposes on CRAs.53 A series of earlier cases against other entities 

that were “reselling” credit reports based on information from large CRAs similarly had 

51. These are discussed in some detail in Section I above.

52. See Staff Opinion Letters (1997-2001), available at http://www.ftc.gov/os/statutes/fcra/index.htm.

53. First American Real Estate Solutions, LLC, 127 F.T.C. 85 (1999) (consent with a 

reseller concerning the dispute obligations of consumer reporting agencies), available at

http://www.ftc.gov/os/1999/08/faresorder.htm. Although the violations charged in the complaint all concerned 

acts committed before the 1996 Amendments became effective, the order requires the CRA to comply with the 

amended FCRA.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

established that such companies were CRAs subject to all the duties imposed on such 

agencies by the FCRA.54

In a 1997 informal opinion letter, the staff opined that (1) a company that sells “merge and 

purge” reports that are a compilation of information procured from another CRA reports is 

itself a CRA, but (2) a seller of a software package that enables the purchaser to perform that 

task itself is not “assembling or evaluating” the information and is thus not a CRA.55 The 

Staff Summary adopts this clarification, specifically distinguishing the resale of consumer 

reports from a company that sells a software system to a company that resells consumer 

reports.

B. “Review” permissible purposes. Section 604(a)(3)(A) of the FCRA provides that obtaining 

a consumer report “in connection with a credit transaction involving the consumer on whom 

the information is to be furnished and involving the ... review or collection of an account 

of the consumer.” is a permissible purpose. Id. (emphasis added). The issues here concern 

when a creditor has a permissible “review” purpose and, when it does, whether it may 

exploit consumer reports obtained for “review” purposes in order to market its products or 

services.

In a 1999 letter,56 the staff opined on this issue in the context of closed-end credit 

transactions. Because the terms of closed-end credit transactions are generally 

predetermined and thus may not be changed unilaterally by the creditor, the staff opined 

that the creditor in that instance did not have a “review” permissible purpose. The Staff 

Summary adopts the essence of this opinion, but makes clear that the analysis does not turn 

on whether or not the account is open-end or closed-end. Staff believes that the “review” 

permissible purpose applies only where the creditor has an existing account relationship 

with the consumer and uses the report solely to decide whether to modify the terms of the 

54. See W.D.I.A., 117 F.T.C. 757 (1994); I.R.S.C., 116 F.T.C. 266 (1993); CDB Infotek, 116 F.T.C. 280 (1993); 

Inter-Fact, Inc., 116 F.T.C. 294 (1993). Each of these cases charged the respondent CRA/reseller with 

providing reports to parties without a permissible purpose, in violation of Section 604 of the FCRA. The 

WDIA case also involved alleged violations of Section 613. More recently, the principle was reinforced in 

the Commission’s settlement with ChoicePoint (United States v. ChoicePoint, Inc., Civ. No. 106-CV-019R, 

N.D. Ga., Feb. 15, 2006), a CRA that also acts as a reseller of consumer reports obtained from Equifax. See 

footnotes 16-17 above.

55. See Cast, FTC Informal Staff Opinion Letter, Oct. 27, 1997 available at

http://www.ftc.gov/os/statutes/fcra/cast.htm. In each case, the purchaser is a creditor with a permissible purpose 

to procure reports from the bureaus.

56. See Gowen, FTC Informal Staff Opinion Letter, Apr. 9, 1999, available at

http://www.ftc.gov/os/statutes/fcra/gowen.htm.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

account.57 Thus, a creditor may not obtain consumer reports to market its other products or 

services because it does not have a legitimate “review” permissible purpose. 

C. Permissible purpose for automobile dealers. The Staff Summary includes some clarification 

on when an automobile dealer has a permissible purpose to obtain a consumer report. The 

Summary incorporates the analysis reflected in a 1998 opinion letter that discussed various 

scenarios involving a consumer who visits a car dealer’s showroom.58 When the consumer 

expresses an interest in buying a car on credit, there would be a permissible “credit” purpose 

under section 604(a)(3)(A). If the dealer gets the consumer’s written consent, there is clearly 

a permissible purpose under section 604(a)(2). 

The auto dealer trade association that sought the opinion asked whether a dealer could 

demonstrate a permissible purpose by showing it has a “legitimate business need” under 

section 604(a)(3)(F)(i), in the context of other interactions between consumers and auto 

sales personnel. That section provides a permissible purpose where the report user “has a 

legitimate business need for the information in connection with a business transaction that 

is initiated by the consumer” (emphasis added). The 1998 staff opinion letter concluded that 

this language meant that this section applies only to situations where the consumer clearly 

understands that he or she is initiating the purchase of a vehicle. The dealer would thus 

have a permissible purpose to obtain a credit report on a consumer who offers to pay for an 

automobile with a personal check or asks about credit options to finance a specific purchase. 

However, this section would not allow the salesperson to obtain a report on “window 

shoppers” for bargaining purposes, deciding whether to spend time with consumers, or 

to respond to general questions about available products or financing, because there is 

no “transaction ... initiated by the consumer” in those scenarios. For the same reason, a 

consumer’s request to “test drive” a vehicle, where he or she has not demonstrated an intent 

to initiate the purchase or lease of a vehicle, does not give rise to a permissible purpose 

under this section.

The Staff Summary incorporates this interpretation, while at the same time noting that a 

permissible purpose is always available under section 604(a)(2) if the dealership obtains 

written consent from the consumer. 

57. Relevant legislative history explains that “[t]he permissible purpose created by this provision, however, is 

limited to an account review for the purpose of deciding whether to retain or modify current account terms.” S. 

Rep. No. 104-185 at 35 (1995).

58. See Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998, available at

http://www.ftc.gov/os/statutes/fcra/coffey.shtm.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

D. Prescreening (“firm offer of credit”). Sections 603(l), 604(c), 604(e), and 615(d) of the 

FCRA codify procedures that must be followed by creditors and insurers when using (and by 

CRAs when providing) consumer reports to make unsolicited offers of credit or insurance to 

consumers, a process known as “prescreening.” 

Prior to the 1996 Amendments, the FCRA did not specifically address the use of consumer 

reports for unsolicited offers of credit or insurance. The Commission, however, issued 

an interpretation of the FCRA in 1973 that permitted the use of consumer reports by 

creditors for unsolicited offers of credit if creditors followed specific guidelines set forth 

in the Commission’s interpretation.59 Those guidelines required every consumer on any 

list resulting from the use of consumer reports to receive a firm offer of credit – i.e., the 

offer must be unconditional; all the consumer had to do to receive the credit was to accept 

the offer. The Commission’s prescreening guidelines were incorporated in 1990 comment 

604(3)(a)-6.

In the 1996 Amendments, Congress added a number of provisions to the FCRA to provide 

an explicit statutory framework for prescreening. The legislative process leading to the 

1996 amendments included an extensive consideration of prescreening issues. As a result of 

these discussions, the 1996 Amendments (1) explicitly authorize prescreening for the first 

time; (2) apply the process to insurance offers as well as credit offers; (3) allow creditors 

and insurers the right to conduct limited “postscreening” so that they can deny credit or 

insurance to consumers who no longer meet the creditworthiness or insurability criteria 

initially used to select them for the prescreened offer; (4) allow consumers to “opt out” of 

prescreened offers; and (5) require creditors and insurers to include specific disclosures in 

their offers to consumers.

The Staff Summary explains the relationship between the FCRA sections that concern 

prescreening added by the 1996 Amendments, and incorporates the holdings of significant 

cases in this area, including Cole v. U.S. Capital, Inc., 389 F.3d 719 (7th Cir. 2004), and 

Murray v. New Cingular Wireless, 523 F.3d 719 (7th Cir. 2008). Specifically, following 

Cole, the Summary notes that although a firm offer of credit may include an offer to sell 

goods, the offer of credit may not be a “sham offer” used as a ruse to engage in target 

marketing. Further, the Summary states that a solicitation may be a firm offer of credit even 

59. 16 CFR § 600.4. The Commission’s reasoning for permitting prescreening was that the invasion of consumer 

privacy involved in prescreening was offset by the fact that every consumer received an offer of credit. The 

Federal Financial Institutions Examination Council, an umbrella organization of Agencies regulating banks, 

issued a policy statement to the same effect on November 2, 1991. 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

if the solicitation does not set forth the terms of the offer or includes a term that is variable, 

such as the interest rate on a credit card account.

In the Summary that follows, we use a section-by-section format, similar to the organization 

used by the Commission in its 1990 Commentary. For the convenience of readers, we reference 

a large number of 1990 comments60 and informal staff opinion letters as the source of the 

interpretations.

60. The interpretations in the Summary do not always reflect verbatim the analogous 1990 comments. We have 

modified some to account for post-1990 FCRA amendments or cases, to make them consistent with other 

comments, and to make them more relevant to current practice. We have edited others for clarity or to accord 

with modern style. Even though the 1990 comments listed in the endnotes are not precisely duplicated in the 

2011 Staff Summary, staff believes the references will assist readers where a 1990 comment is a source for an 

interpretation here. 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

FTC Staff Summary of Interpretations of 

the Fair Credit Reporting Act

OVERVIEW

This Staff Summary contains the Federal Trade Commission staff’s interpretations of the Fair Credit 

Reporting Act. It includes many of the interpretations from the “Statement of General Policy or 

Interpretations” that the Commission published in May 1990, 16 CFR Part 600. It includes informal 

guidance staff has provided to the public in the ensuing years and our experience in enforcing the FCRA. 

The Staff Summary does not have the force or effect of regulations or statutory provisions. 

REFERENCE TO MULTIPLE SECTIONS

Reference to several different provisions of the FCRA is frequently required in order to discuss or provide 

guidance on an issue. For some sections and subsections of the FCRA, the Staff Summary discusses the 

most important and common overlapping references under the heading “Relation to other (sub)sections.”

SUMMARY REFERENCES TO FCRA

The Staff Summary should be used in conjunction with the text of the FCRA. In some cases, the Staff 

Summary includes a partial summary of the statute, rather than the full text, as a preamble to discussion 

of issues pertaining to various sections and subsections. These summary statements of the law (often very 

abbreviated, especially for sections where no interpretations are offered) should not be used as a substitute 

for the statutory text.

TERMINOLOGY

Several terms that are used repeatedly are abbreviated for convenience:

“Board” means the Board of Governors of the Federal Reserve System.

“Bureau” means the Bureau of Consumer Financial Protection, which assumed some of the 

Commission’s FCRA responsibilities on July 21, 2011, pursuant to Title X of the Consumer 

Financial Protection Act of 2010 (Public Law 111-203).

“CFR” means the Code of Federal Regulations.

“Commission” means the Federal Trade Commission.

“CRA” means “consumer reporting agency” as defined in section 603(f) of the FCRA.

“ECOA” means the Equal Credit Opportunity Act.

“FACT Act” means the Fair and Accurate Credit Transactions Act of 2003, Public Law 108-159 

(Dec. 4, 2003).

“FCRA” means the Fair Credit Reporting Act.

“Federal financial agencies” means agencies assigned administrative authority over financial 

institutions by section 621(b)(1)(A/B) of the FCRA.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

“1990 Interpretations” means the Appendix to 16 CFR Part 600 titled “Statement of General 

Policy or Interpretations” published by the Commission on May 4, 1990.

“Nationwide CRA” means “consumer reporting agency that compiles and maintains files on 

consumers on a nationwide basis” as defined in section 603(p) of the FCRA.

“Nationwide specialty CRA” means “nationwide specialty consumer reporting agency” as 

defined in section 603(x) of the FCRA.

CITATIONS TO FACT ACT RULES

Some of the rules required by the FACT Act were promulgated by the Commission jointly or in 

consultation with some or all of the Federal financial agencies. This Staff Summary cites only the 

Commission’s FCRA regulations, which are set forth in 16 CFR Parts 601-699. The other agencies’ 

regulations may be found in 12 CFR Parts 41, 222, 334, 571, and 717.
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

Section 601 – Short Title

“This title may be cited as the Fair Credit Reporting Act.”

The FCRA is Title VI of the Consumer Credit Protection Act, which also includes other federal 

statutes relating to consumer credit, such as the Truth in Lending Act (Title I), the Credit Repair 

Organizations Act (Title II-A), the Equal Credit Opportunity Act (Title VII), and the Fair Debt 

Collection Practices Act (Title VIII).

Section 602 – Findings and Purpose 15 USC 1681

Section 602 recites the Congressional findings regarding the significant role of 

CRAs in the nation’s financial system, and states that the basic purpose of the 

FCRA is to require CRAs to adopt reasonable procedures for providing information 

to credit grantors, insurers, employers and others in a manner that is fair and 

equitable to the consumer with regard to confidentiality, accuracy, and the proper 

use of such information.

Section 603 – Definitions and Rules of Construction 15 USC 1681a

Section 603(a) states that “definitions and rules of construction set forth in this 

section are applicable for the purposes of this title.”

Section 603(b) defines “person” to mean “any individual, partnership, 

corporation, trust, estate, cooperative, association, government or governmental 

subdivision or agency or other entity.”

1. EXAMPLES

The term “person” is broadly defined to include not only individuals, but also universities, 

creditors, collection agencies, insurance companies, private investigators, and employers.1

Section 603(c) defines “consumer” to mean “an individual.”

1. GENERAL

The term “consumer” includes only a natural person. It does not include artificial entities, such as 

partnerships, corporations, trusts, estates, cooperatives, associations or entities created by statute, 

such as governmental agencies.2

Section 603(d)(1) defines “consumer report” to mean “any written, oral, or other 

communication of any information by a consumer reporting agency bearing on a 

consumer’s credit worthiness, credit standing, credit capacity, character, general 

reputation, personal characteristics, or mode of living which is used or expected 

to be used or collected in whole or in part for the purpose of serving as a factor 

in establishing the consumer’s eligibility for (A) credit or insurance to be used 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

primarily for personal, family, or household purposes; (B) employment purposes; 

or (C) any other purpose authorized under section 604” (except for exclusions set 

forth in section 603(d)(2)).

1. RELATION TO “CONSUMER REPORTING AGENCY”

To be a “consumer report,” the information must be furnished by a “consumer reporting agency” 

as that term is defined in section 603(f). The term “consumer reporting agency” means a person 

that regularly engages in assembling or evaluating information on consumers for the purpose of 

furnishing “consumer reports” to third parties. The terms “consumer reporting agency” in section 

603(f) and “consumer report” in section 603(d) are mutually dependent and must be construed 

together. Information is not a “consumer report” if the person furnishing the information is not a 

“consumer reporting agency.”3 For example, a communication to an employer about a job applicant 

from a source that is not a CRA (such as a prior employer) does not constitute a “consumer 

report.”4

2. ELEMENTS OF THE DEFINITION OF “CONSUMER REPORT”

There are two basic elements of the definition. First, the information in the report must have a 

“bearing on” one or more specified consumer characteristics (e.g., credit standing). Second, the 

report must be “used or expected to be used ... for the purpose of ... establishing the consumer’s 

eligibility” for credit, employment, insurance, or other permissible purposes allowed by the FCRA. 

Both elements of the definition must be satisfied in order for a report to be a consumer report; thus, 

information that is not “used or expected to be used” to determine eligibility for a permissible 

purpose is not a consumer report, even if the information bears on one of the seven specified 

consumer characteristics. For example, a “skip tracer” report of prior addresses used solely to 

locate an uninsured automobile driver is not an investigative or other “consumer report” if it would 

not be used to determine eligibility for credit, employment, insurance, or other permissible business 

purposes allowed by the FCRA.

3. EXCLUSIONS FROM THE DEFINITION

Sections 603(d)(2-3), 603(o), and 603(y)5 exclude some communications from the definition of 

“consumer report” even if they otherwise contain the elements set forth in section 603(d)(1). Most 

significantly, they set forth the circumstances in which information reported by a party about its 

own transactions or experience with a consumer, information shared by affiliated companies, 

certain communications by employment agencies, and reports in the context of alleged workplace 

misconduct are not “consumer reports.” 

4. INCORPORATION OF INFORMATION FROM PRIOR CONSUMER REPORTS

If information from a consumer report is added to a report that is not otherwise a consumer report, 

that report becomes a consumer report.6

5. REPORT CONCERNING A “CONSUMER’S” ATTRIBUTES AND HISTORY

A. General. A “consumer report” is a report on a “consumer” to be used for certain purposes 

involving that “consumer.”7 Information that does not identify a specific consumer does not 

constitute a consumer report even if the communication is used in part to determine eligibility. 

For example, a communication that flags a specific Internet transaction as potentially 

fraudulent based on comparison to aggregate data about Internet transactions (e.g., timeof-day activity, geographic location, amount of the transaction, etc.), without reference to 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

an individual consumer, is not a consumer report. However, information may constitute 

a consumer report even if it does not identify the consumer by name if it could otherwise 

reasonably be linked to the consumer.

B. Artificial entities. Reports about corporations, associations, and other collective entities are not 

reports about a consumer, and thus are not consumer reports subject to the FCRA.8

C. Reports on individuals in a business context. A report that concerns the consumer’s business

history (as opposed to personal credit or employment history) that is collected and provided 

by a commercial reporting service solely for use in business transactions is not a “consumer 

report.” (Similarly, the report provider is not a CRA.)9 However, a report from a CRA on the 

personal credit of a consumer to a business credit grantor is a “consumer report” regardless of 

the purpose for which the information may in fact be used.10 Reports obtained from CRAs on 

consumers retain their character as “consumer reports” even if they are subsequently furnished 

in connection with a commercial credit or insurance transaction.

6. “CREDIT WORTHINESS, CREDIT STANDING, CREDIT CAPACITY, CHARACTER, GENERAL 

REPUTATION, PERSONAL CHARACTERISTICS, OR MODE OF LIVING ....”

A. General. To be a “consumer report,” the information must bear on at least one of the seven 

characteristics listed in this definition.11

B. Credit scores. The term “consumer report” includes numerical or other evaluation of data by a 

CRA, such as a credit score that bears on a consumer’s creditworthiness.

C. Consumer lists.

i. List of creditworthy individuals. A list of the names of creditworthy individuals, or 

of individuals on whom CRAs have derogatory information, is a series of “consumer 

reports” because the information bears on credit worthiness and is used or expected to be 

used for permissible purposes.12

ii. Lists of names and contact information. A report limited to identifying information such 

as a consumer’s name, address, former addresses, or phone numbers, does not constitute 

a “consumer report” if it does not bear on any of the seven factors and is not used to 

determine eligibility. A list of consumers’ names and addresses, if assembled or defined 

by reference to characteristics or other information that is also used (even in part) in 

eligibility decisions, is a series of consumer reports. For example, a list comprised solely 

of consumer names and addresses, but compiled based on the criterion that every name 

on the list has at least one active trade line, updated within six months, is a series of 

consumer reports.13

iii. Directories. Telephone and other directories that only provide names, addresses, and 

phone numbers, are not “consumer reports,” because the information is not collected to 

be used or expected to be used in evaluating consumers for credit, insurance, employment 

or other purposes. A trade directory that simply lists commercial information that would 

be used for commercial purposes is also not a consumer report.14

D. Public record information. A communication consisting solely of public record information 

is not a “consumer report” unless that information is provided by a CRA, is used or expected 

to be used for the purposes identified in section 603(d), and bears on at least one of the seven 

characteristics listed in the definition. Public record information relating to records of arrest, 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

bankruptcies, or the institution or disposition of civil or criminal proceedings, bears on one or 

more of these characteristics.15

E. Rental history. Reports about rental experiences such as consumers’ evictions, rental payment 

histories, or treatment of premises are consumer reports, if provided by a CRA, because they 

relate to the consumer’s “character, general reputation, personal characteristics, or mode of 

living.”16

F. Information provided to employers. A “consumer report” includes more than just consumer 

credit information. When CRAs provide information to employers regarding consumers’ 

driving records, employment records, criminal histories, education, and licenses held by job 

applicants or current employees, they are providing “consumer reports” because the data 

involves the individual consumer’s “character, general reputation, personal characteristics, 

or mode of living.”17 For example, when a private investigator who compiles and provides 

court documents to employer clients requests criminal or civil records on employees or 

job applicants, the investigator is a CRA providing a “consumer report.”18 Similarly, an 

employment screening service that provides education verifications, employment verifications, 

and reference checks for employers is a CRA providing “consumer reports” because that 

information bears upon an individual’s “character, general reputation, personal characteristics, 

or mode of living” and is used for employment purposes.19 A CRA’s provision of information 

regarding the prior work experience of job applicants to prospective employers is a “consumer 

report,” even where the information is communicated telephonically.20

7. “USED OR EXPECTED TO BE USED OR COLLECTED IN WHOLE OR IN PART FOR THE PURPOSE 

OF SERVING AS A FACTOR IN ESTABLISHING THE CONSUMER’S ELIGIBILITY” FOR ENUMERATED 

PERMISSIBLE PURPOSES

A. Law enforcement purposes. Information that is assembled and provided solely for law 

enforcement purposes is not a “consumer report.” For example, bulletins that are limited 

to a series of descriptions, sometimes accompanied by photographs, of individuals who are 

being sought by law enforcement authorities for alleged crimes are not a series of “consumer 

reports” because they have not been collected for use in evaluating consumers for credit, 

insurance, employment or other enumerated permissible purposes.21

B. Consumer transaction purposes. A report of information about a consumer from a database 

relating to fraud losses (including fraud committed under fictitious names) is a “consumer 

report” if it is intended for use by creditors to evaluate consumers’ credit applications. A report 

containing information on returned checks (volume, dates, amounts, circumstances) would be 

a “consumer report” if used in connection with transactions involving the report subject, such 

as closing, restricting or otherwise altering the terms of depository or other accounts that were 

used primarily for personal, family or household purposes.

C. Use of reports for purposes not reasonably anticipated by the party that supplies the report.

A report that is not otherwise a consumer report may become a consumer report when it is 

subsequently used by the recipient for a permissible purpose. If the entity supplying the report 

has taken reasonable steps to insure that the report is not used for such a purpose, and if it 

neither knows of, nor can reasonably anticipate such use, the report should not be deemed a 

consumer report by virtue of uses beyond the entity’s control. The entity supplying the report 

might establish that it does not reasonably anticipate such use of the report by requiring the 

recipient to certify that the report will not be used to determine eligibility for a permissible 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

purpose, by auditing report recipients for compliance, and by taking appropriate action against 

those who violate such certifications.22

D. “In whole or in part.” Where an entity reports information regarding individuals and 

companies, both for covered purposes under the FCRA (e.g., employment checks, credit 

checks) and non-covered purposes (e.g., businesses or commercial purposes), the report is a 

“consumer report.” 

8. “ESTABLISHING THE CONSUMER’S ELIGIBILITY FOR (A) CREDIT OR INSURANCE TO BE USED 

PRIMARILY FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES, OR (B) EMPLOYMENT 

PURPOSES, OR (C) OTHER PURPOSES AUTHORIZED UNDER SECTION 604”

A. Relation to section 604(a). Because section 603(d)(1)(C) refers to any “purpose authorized 

under section 604” (often described as “permissible purposes” of consumer reports), some 

of which overlap with purposes enumerated in section 603, sections 603 and 604 must be 

construed together to determine what are “consumer reports” and “permissible purposes” 

under the two sections. See comment 604(a)-1.23

B. Relation to section 604(a)(3)(C) – “eligibility ... for insurance.” Reports provided to insurers 

by claims investigation services solely to determine the validity of insurance claims – and 

not for underwriting purposes – are not consumer reports. Section 604(a)(3)(C) specifically 

sets forth only underwriting (not claims) as an insurance-related purpose, and section 603(d)

(1) deals specifically with eligibility for insurance and no other insurance-related purposes.24

Compare comment 603(f)-6.

C. Relation to sections 604(a)(3)(B) and 603(h) – “employment purposes.” Section 604(a)(3)(B) 

lists “employment purposes” as a permissible purpose. Section 603(h) defines “employment 

purposes” to include “promotion, reassignment or retention,” as well as to evaluate a job 

applicant. Accordingly, a report provided by a CRA that is used or is expected to be used or 

collected in whole or in part in connection with these purposes is a consumer report.25

D. “Other purposes authorized under section 604” – apartment rentals and personal checks. A 

report provided by a CRA and used to determine whether to rent a residence to a consumer 

is a consumer report, regardless of whether it includes credit information, because it is used 

for a business transaction that the consumer has initiated for “personal, family or household 

purposes.”26 Similarly, a report by a CRA indicating that an individual has issued bad checks 

is a consumer report. The information furnished bears on consumers’ character, general 

reputation, and personal characteristics, and it is used or expected to be used in connection 

with business transactions that a consumer has initiated. Compare comment 603(d)-7A, stating 

that information that is compiled and used only for law enforcement or similar purposes is not 

a “consumer report.”

Section 603(d)(2)(A)(i) excludes from the definition of consumer report “any 

report containing information solely as to transactions or experiences between the 

consumer and the person making the report.”

1. TRANSACTION OR EXPERIENCE INFORMATION

A. General. Reports limited to transactions or experiences between the consumer and the entity 

making the report are not consumer reports. An opinion that is based only on transactions or 

experiences between the consumer and the reporting entity is also within the exception. For 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

example, a creditor’s description of an account as “slow pay” would not be a consumer report 

if the description was based on the creditor’s own experience with the account and did not 

come from a CRA.27

B. First-hand report of consumer’s performance. A communication by an employer that describes 

an employee’s job performance, by a creditor about a customer’s repayment of a debt, or by 

a collection agency to a CRA that is limited to the agency’s own transactions and experiences 

with the debtor (whether acting on its own or on behalf of a creditor/client) is not a “consumer 

report.”

C. Lab reports. Drug test results provided by a lab directly to an employer are not “consumer 

reports” because they constitute reports based on the experience of the laboratory with the 

consumer (applying scientific methods to test urine or other samples from the consumer).28

D. Personal observations. A report that consists solely of information communicated by a person 

who drives by the consumer’s residence, a property appraiser who evaluates property, or an 

investigator who makes a video recording of events, is not a “consumer report” because it 

consists solely of the experience of the party supplying the report.

E. Reference checks. A communication from a former or current employer to a CRA or other 

third party, involving only transactions between the consumer (the employee or applicant) 

and the person making the report (the current or former employer) is not a consumer report 

because it is based on the “experiences between the consumer and the person making the 

report.”29 However, a communication of such information from a CRA to a potential employer 

is a consumer report because the transactions or experiences referred to in the communication 

are not between the job applicant and the CRA. See comment 603(d)-6F.

F. Creditor information. A list provided by a creditor of its customers who have account 

balances of $10,000 or more would constitute “transaction or experience” information and 

would therefore be excluded from the definition of “consumer report” when provided by the 

creditor.30

2. INFORMATION BEYOND THE REPORTING ENTITY’S “TRANSACTIONS OR EXPERIENCES” WITH 

THE CONSUMER

A. General. Reports of information that go beyond an entity’s own transactions or experiences 

with the consumer are not within the exclusion, and thus may be consumer reports. For 

example, a creditor’s or an insurance company’s report to a third party of the reasons it 

cancelled credit or insurance, if based on information from an outside source (e.g., a consumer 

report), may be a consumer report.31

B. Application information. A report by a creditor of application information supplied by 

the consumer (including lists of his or her assets and liabilities, and lists of the names of 

companies from whom the customer has purchased insurance and securities) is not the 

creditor’s “transaction or experience” information because it includes the customer’s 

transactions with entities other than the creditor.32

Section 603(d)(2)(A)(ii) excludes from the definition of consumer report any 

communication of transaction and experience information among affiliated 

companies. Section 603(d)(2)(A)(iii) excludes from the definition of consumer 

report any “communication of other information among persons related by 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

common ownership or affiliated by corporate control,” if the consumer receives 

notice of such communications and an opportunity to opt out.

1. RELATION TO SECTION 624 AND THE AFFILIATE MARKETING RULE

Section 603(d)(2)(A)(ii) and (iii) allow affiliates to share information among themselves about 

their own transactions and experiences with consumers without such information being deemed a 

“consumer report.” They also allow consumers to opt out of having any of their other information 

shared among affiliates. Section 624 provides consumers with a similar right to “opt out” of the 

use of their information among affiliates for marketing purposes. The FACT Act, which added 

section 624 to the FCRA, directed the Commission and Federal financial agencies to promulgate 

regulations implementing this right. Starting July 21, 2011, the Bureau assumes rulemaking 

authority under this section. See comment 624-1 for more details concerning the Affiliate 

Marketing Rule. The Commission staff will interpret section 603(d)(2)(A) consistently with section 

624 and the Affiliate Marketing Rule, which use similar terminology. The Commission rule is set 

forth at 16 CFR Parts 680 and 698 App. C.

2. CONSUMER CONSENT

A person provides a reasonable “opportunity” to opt out if the consumer affirmatively consents 

to communications with affiliates, after having been properly notified of the right to prohibit such 

communications.

Section 603(d)(2)(B) exempts from the definition of consumer report “any 

authorization or approval of a specific extension of credit directly or indirectly by 

the issuer of a credit card or similar device.”

1. GENERAL 

A credit or debit card issuer’s written, oral, or electronic communication of its decision whether to 

authorize a charge, in response to a request from a merchant or other party that the consumer has 

asked to honor the card, is not a “consumer report.”33

Section 603(d)(2)(C) exempts from the definition of consumer report “any report 

in which a person who has been requested by a third party to make a specific 

extension of credit directly or indirectly to the consumer conveys his decision with 

respect to such request, if the third party advises the consumer of the name and 

address of the person to whom the request was made” and such person provides 

appropriate adverse action notices under section 615.

1. GENERAL

This exemption covers retailers’ attempts to obtain credit for their individual customers from an 

outside source, such as a bank or a finance company. The creditor’s communication of its decision 

whether to extend credit is not a “consumer report” if the retailer informs the customer of the 

name and address of the creditor to which the application or contract is offered and, if the credit 

application is denied, the creditor provides an adverse action notice to the consumer.34
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

2. INFORMATION INCLUDED WITHIN EXEMPTION

Because this exemption applies to “any report,” it includes not only the “yes” or “no” decision as to 

whether to extend credit, but also the information constituting the basis for the credit decision.35

3. HOW THIRD PARTY CREDITORS CAN INSURE THAT EXEMPTION APPLIES

Creditors can insure that the exemption contained in this section applies by (1) having a written 

agreement requiring the retailer to inform the consumer of the creditor’s name and address and (2) 

providing adverse action notices if they deny credit.36

Section 603(d)(2)(D) exempts from the definition of consumer report any 

“communication described in subsection (o) or (x).”

1. RELATION TO OTHER SECTIONS

Section 603(o) exempts from the definition of “consumer report” certain reports by employment 

agencies engaged in procuring jobs for applicants or employees for employers under prescribed 

circumstances. Section 603(x) – re-designated 603(y) by the Consumer Financial Protection Act of 

2010 – exempts reports made in connection with investigations of employee misconduct.

Section 603(d)(3) provides that the exemptions from the definition of “consumer 

report” do not apply if the communication includes medical information other than 

that specified in section 604(g)(3).

1. RELATION TO OTHER SECTIONS

This section cross references section 604(g)(3) and works as follows. 

Section 603(d)(2) exempts from the definition of consumer report (1) certain communications 

among affiliates; (2) information relating to transactions or experiences between the consumer 

and person making the report; (3) a card issuer’s decision to approve specific charges; (4) a 

third party creditor’s decision to approve a retailer’s payment card; and (5) certain employmentrelated communications. If any such exempted communications or information relates to medical 

information, section 603(d)(3) provides that the foregoing exemptions do not apply, and the 

information will be deemed a consumer report. 

Section 604(g)(3), however, provides that the following communications involving medical 

information will not be deemed to be a consumer report: (1) information relating to the business of 

insurance or annuities; (2) information for which disclosure is permitted under the Health Insurance 

Portability and Accountability Act, and rules issued thereunder; (3) information for which 

disclosure is permitted under the Gramm-Leach Bliley Act; or (4) information for which disclosure 

is determined to be necessary and appropriate in rules issued by Federal financial agencies or state 

insurance authorities. See comment 604(g)-2. 

Section 603(e) defines “investigative consumer report” as “a consumer report or 

portion thereof in which information on a consumer’s character, general reputation, 

personal characteristics, or mode of living is obtained through personal interviews 

.... However, such information shall not include specific factual information on a 

consumer’s credit record obtained directly from a creditor of the consumer or from 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

a consumer reporting agency when such information was obtained directly from a 

creditor of the consumer or from the consumer.”

1. RELATION TO OTHER SECTIONS

The term “investigative consumer report” describes a type of “consumer report” for which the 

FCRA imposes additional and different requirements on recipients and CRAs. Persons procuring 

“investigative consumer reports” must make certain disclosures to the consumers who are the 

subjects of the reports, as required by section 606. Under section 614, CRAs generally must verify 

certain adverse information from a previous “investigative consumer report” when furnishing 

subsequent consumer reports. CRAs making file disclosures to consumers pursuant to section 

609 are not required to disclose “sources of information acquired solely for use in preparing an 

investigative consumer report and actually used for no other purpose.”37

2. “INVESTIGATIVE CONSUMER REPORT”

An “investigative consumer report” is a type of “consumer report” that includes information 

obtained through personal interviews with the consumer’s neighbors, friends, associates or others.38

If a communication does not fall within the definition of “consumer report,” however, it will not be 

an “investigative consumer report.” 

3. “PERSONAL INTERVIEWS”

A. General. “Personal interviews” include interviews with a neighbor, friend, or associate of 

the consumer conducted by mail, telephone or electronic means, as well as in person.39 A 

report containing interview information obtained solely from the report subject is not an 

“investigative consumer report” because the information was not collected through personal 

interviews with third persons.40 A report that consists solely of information gathered from 

observation by one who drives by the consumer’s residence is not an “investigative consumer 

report,” because it contains no information from “personal interviews.”41 See also comment 

603(d)(2)(A)(i)-1D.

B. Employment confirmation or evaluation. A discussion between a CRA and a job applicant’s 

former or current employer to verify or confirm facts reported on an employment application – 

e.g., the time and/or duration of employment, job titles/and or salaries during the employment 

period – is not an “interview” for purposes of this section, and the report is not an investigative 

consumer report. However, an evaluation of the applicant’s job performance by a prior or 

current employer to a CRA that goes beyond fact-checking – e.g., whether the applicant had 

been disciplined on the job or terminated for cause – would constitute an interview, and a 

report compiling those responses for a potential employer would be an investigative consumer 

report.42

C. Unsolicited information. If a former or current employer or other source voluntarily offers 

opinions or other unsolicited information and the CRA includes the opinions or other 

unsolicited information in the report, the report would become an investigative consumer 

report despite the fact that the CRA did not originally intend to obtain the information. If the 

CRA does not include the unsolicited information in its report, then it is not an investigative 

consumer report.43
28

40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

4. NONINVESTIGATIVE INFORMATION IN “INVESTIGATIVE CONSUMER REPORTS”

A report that is obtained by personal interviews with the consumer’s neighbors, friends, associates 

or others does not lose its status as an “investigative consumer report” if it also contains 

noninvestigative information (such as a credit report), because the definition includes reports, a 

“portion” of which are investigative reports.44

Section 603(f) defines “consumer reporting agency” as “any person which, for 

monetary fees, dues, or on a cooperative nonprofit basis, regularly engages 

in whole or in part in the practice of assembling or evaluating consumer credit 

information or other information on consumers for the purpose of furnishing 

consumer reports to third parties, and which uses any means or facility of interstate 

commerce for the purpose of preparing or furnishing consumer reports.”

1. RELATION TO OTHER SECTIONS

A. Duties imposed on CRAs. The FCRA imposes a number of duties on “consumer reporting 

agencies.” They must have permissible purposes to furnish consumer reports (section 

604), take certain actions relating to identity theft (sections 605A, 605B), avoid furnishing 

obsolete adverse information in certain consumer reports (sections 605, 607(a)), adopt 

reasonable procedures to assure privacy (sections 604, 607(a)) and accuracy (section 607(b)) 

of consumer reports, provide only limited disclosures to governmental agencies (section 

608) except in cases involving counterintelligence and counterterrorism (sections 625-626), 

provide consumers certain disclosures upon request (sections 609 and 610) at no cost or 

for a reasonable charge (section 612), follow certain procedures if a consumer disputes the 

completeness or accuracy of any item of information contained in his file (section 611), and 

follow certain procedures in reporting public record information for employment purposes 

or when reporting adverse information other than public record information in investigative 

consumer reports (sections 613, 614). CRAs that resell consumer reports procured from other 

CRAs have additional obligations (section 607(e)).45

B. Relation to “consumer reports.” The terms “consumer report” in section 603(d) and “consumer 

reporting agency” as defined in section 603(f) are defined in a mutually dependent manner, 

and must therefore be construed together. For example, the term “consumer reporting agency” 

includes certain persons who assemble or evaluate information on consumers for the purpose 

of furnishing “consumer reports” to third parties. Thus, a person is not a “consumer reporting 

agency” if it provides only information that (1) is not included in the definition of consumer 

report (e.g., information that does not bear on the consumer’s creditworthiness or any of the 

other six consumer characteristics) or (2) is excepted from the definition of consumer report 

(e.g., reports limited to the party’s own transactions or experiences with a consumer).46

2. “FOR MONETARY FEES, DUES, OR ON A COOPERATIVE NONPROFIT BASIS, ....”

A. Information pools or exchanges. Entities that work together for a common purpose without 

monetary compensation may form a CRA. For example, loan exchanges, which are generally 

owned and operated on a cooperative basis by consumer finance companies, establish a 

mechanism through which each member can (1) provide the identities and loan amounts of 

their borrowers, and (2) receive information on the outstanding loans of its applicants. Because 

such loan exchanges operate on a cooperative nonprofit basis, they are CRAs.47
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

B. Information provided to CRAs. A creditor that provides a consumer’s application information 

to a CRA to obtain a credit report does not become a “consumer reporting agency.” In this 

circumstance, the creditor is not providing the information for “fees, dues, or on a cooperative 

nonprofit basis;” rather, it pays the CRA to provide a consumer report so that the creditor can 

verify the information on the application.48

3. “REGULARLY ENGAGES IN WHOLE OR IN PART IN THE PRACTICE OF ASSEMBLING 

OR EVALUATING CONSUMER CREDIT INFORMATION OR OTHER INFORMATION ON 

CONSUMERS ....”

A. Isolated transactions. A business that furnished information on a customer or employee 

in response to a single inquiry from another party would not “regularly” be making such 

disclosures.49

B. Assembling or evaluating. “Assembling” means gathering, collecting, or bringing together 

consumer information such as data obtained from CRAs or other third parties, or items 

provided by the consumer in an application. “Evaluating” means appraising, assessing, 

determining or making a judgment on such information. For example, an entity that collects 

consumer report information from multiple sources, evaluates the information, and displays it 

according to the relative reliability of parallel data, is a CRA because it is assembling and/or 

evaluating the information.50

i. General. An entity whose record searchers collect publicly available information such as 

criminal records for employer screening of applicants, then forwards the information to 

its headquarters where a report is prepared consisting of that information, has conducted 

“assembling” activities sufficient to meet the definition of a CRA.51

ii. Conduit functions. An entity that performs only mechanical tasks in connection with 

transmitting consumer information is not a CRA because it does not assemble or evaluate 

information. For example, a business that delivers records, without knowing their content 

or retaining any information from them, is not acting as a CRA even if the recipient uses 

the records to evaluate the consumer’s eligibility for insurance or another permissible 

purpose.52 Similarly, a party that arranges for a job applicant’s lab test, collects and 

forwards samples to the lab, and transmits test results to a prospective employer, is not a 

CRA making a consumer report.53

iii. Sale of software products. A seller of software to a company that uses the software 

product to process credit report information is not a CRA because it is not “assembling 

or evaluating” any information.54 However, a company that uses software to assemble, 

or otherwise assembles, consumer information (other than its own experiences with the 

consumer) for transmission to third parties may be a CRA.55

C. Employment background screening service as a CRA. A third party that provides oral or 

written reports to prospective employers about the prior work experience of applicants is a 

CRA.56 An entity that regularly researches the criminal records of job applicants and reports 

them to its clients is a CRA.57

D. Tenant screening service as a CRA. A business that regularly compiles information on 

consumers as tenants, and provides such data to residential property owners for use in 

evaluating consumer rental applications, is a CRA.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

4. “FOR THE PURPOSE OF FURNISHING CONSUMER REPORTS TO THIRD PARTIES ....”

A. Service providers. A creditor that transmits information about a consumer to a service provider 

(i) solely for the purpose of using the information to service that consumer’s account, and (ii) 

under circumstances that allow the service provider to use the information only in the manner 

that the creditor would be permitted to use it, is not a CRA. The creditor’s purpose is to enable 

the provider to carry out a function on behalf of the creditor with respect to the account. 

Therefore, a creditor would not become a CRA by providing consumer report data to another 

entity such as (i) an underwriter to service or process a transaction with the consumer; (ii) a 

loan servicer to maintain, service, or review the consumer’s account established as part of the 

transaction with the consumer, or (iii) a collection agency to collect on an unpaid debt.

B. Consummation of transaction. A creditor does not become a CRA by communicating 

consumer report information about a loan applicant to an entity that must participate in the 

transaction in order for it to be completed (e.g., if the creditor communicates with an actual or 

potential loan insurer or guarantor to determine whether the entity would issue its insurance 

or guaranty to the holder of an obligation). In these circumstances, where the transactions are 

mutually dependent upon one another, the creditor’s purpose is to use the report information to 

consummate the loan transaction for which the consumer applied.

C. Law compliance. A creditor does not become a CRA by providing consumer information 

in order to comply with compulsory legal process, or for the purpose of assisting law 

enforcement, regulatory, judicial, or public safety authorities. Thus, a creditor may supply 

consumer information (i) to the extent specifically permitted or required under federal, state, 

or local laws, rules, and other applicable legal requirements, and in accordance with the Right 

to Financial Privacy Act of 1978 (12 USC 3401 et seq.); (ii) to law enforcement agencies, 

state insurance authorities, and self-regulatory organizations within the meaning of 15 U.S.C. 

§ 7006; (iii) to comply with a properly authorized civil, criminal, or regulatory investigation, 

or subpoena or summons by federal, state, or local authorities; or (iv) to respond to judicial 

process or government regulatory authorities having jurisdiction over the creditor for 

examination, compliance, or other purposes as authorized by law.

D. Successors. An entity that transmits consumer information to a successor in interest incident 

to the transfer of all or a portion of the underlying consumer asset, liability, account, or 

other relationship, or to any potential successor in interest for the purpose of evaluating 

the potential transaction does not become a CRA, because its purpose is to consummate 

the sale. A creditor’s potential or actual successor in interest may include (i) participants 

in a securitization, secondary-market sale (including sales of servicing rights), or similar 

transactions related to a transaction of the consumer; (ii) purchasers or merger partners in 

a sale, merger, transfer, or exchange of all or a portion of a business or operating unit if the 

furnishing of consumer report information concerns only customers of such business or 

unit; (iii) purchasers of the assets or liabilities of a branch; (iv) transferees in a transfer of 

the creditor’s receivables or accounts; (v) acquirers of a loan participation; (vi) a bankruptcy 

trustee; or (vii) a receiver.

E. Information conveyed at the consumer’s request. An entity acting as an intermediary on behalf 

of the consumer who has initiated a transaction does not become a CRA when it furnishes 

information to a prospective creditor to further the consumer’s application. Thus, a mortgage 

broker does not become a CRA by furnishing consumer reports to prospective creditors on 

behalf of a consumer that has sought the broker’s assistance in obtaining a loan. An entity 
31

AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

does not become a CRA solely because it conveys, with the consumer’s consent, information 

about the consumer to a third party in order to provide a specific product or service that the 

consumer has requested. 

F. Provision of credit report to report subject. A consumer report user does not become a CRA 

by regularly giving a copy of the report, or otherwise disclosing it, to the consumer who is 

the subject of the report (or the consumer’s representative), because it is not disclosing the 

information to a “third party.” See also section 607(c).58

G. Internal uses. A lender that uses a software package to combine credit reports it obtained from 

two or more major CRAs for its own internal use is not a CRA because it is not compiling the 

information “for the purpose of furnishing consumer reports to third parties.”59

H. Employees and agents. An agent or employee that obtains consumer reports does not become 

a CRA by sharing such reports with its principal or employer in connection with the purposes 

for which the reports were initially obtained. Similarly, individual employees and agents hired 

by CRAs to collect information are not CRAs because the employees or agents themselves do 

not provide data to “third parties” but rather acquire information for the CRA to conduct its 

business.60

I. Collectors and creditors. Collection agencies or creditors may become CRAs if they regularly 

furnish “consumer report” information about debtors beyond their transactions or experiences 

with consumers (e.g., credit report or application data) to third parties for use in eligibility 

decisions on consumers’ transactions.61

J. Dishonored checks. An entity that provides information on returned checks (dates, amounts, 

circumstances) for use by financial institutions or merchants in connection with transactions 

involving the report subjects would be a CRA making consumer reports to third parties. 

However, an entity that provided this information solely for law enforcement purposes would 

not be a CRA. See comment 603(d)-7A.

5. GOVERNMENT AGENCIES

A. Federal agencies. The Office of Personnel Management (“OPM”) collects and files data 

concerning current and potential employees of the federal government and transmits that 

information to other government agencies for employment purposes. OPM is not a CRA 

included in the scope of this definition, because the recipient is another governmental branch 

and not a “third party.”62

B. State agencies. A state agency that provides information such as criminal records checks 

to further law enforcement or other state functions mandated by the state legislature is not 

a CRA.63 A state agency that provides publicly available data to third parties, as part of its 

normal operations, is also not a CRA.64

6. CLAIMS HISTORIES FOR UNDERWRITING PURPOSES 

An entity that compiles claim payment histories on individuals from insurers and furnishes them 

to insurance companies solely for use in underwriting decisions concerning those individuals is a 

CRA.65 Compare comment 603(d)-8B.

Section 603(g) defines “file,” when used in connection with information on any 

consumer, to mean “all of the information on that consumer recorded and retained 

by a consumer reporting agency regardless of how the information is stored.”
32

40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

1. RELATION TO OTHER SECTIONS

CRAs are required to make disclosures of all information in their “files” to consumers upon request 

(section 609) and to follow investigation procedures if the consumer disputes the completeness or 

accuracy of any item of information contained in his or her “file” (section 611).66

2. SCOPE

The term “file” includes all information on the consumer that is recorded and retained by a CRA

– regardless of how the information is stored – that has been or might be provided in a consumer 

report on that consumer.67 The term includes such information that a CRA has kept for archival 

purposes, because the definition includes all data “retained” and “stored” by the CRA.68

3. INFORMATION NOT RETAINED FOR INCLUSION IN CONSUMER REPORTS

The term “file” does not include information in a CRA’s billing or consumer relations records on a 

consumer who obtains a disclosure or files a dispute, or an “audit trail” (a list of changes made by a 

CRA to a consumer’s credit history record, maintained to detect fraudulent changes to that record), 

if the information would not be included in a report on the consumer.69

Section 603(h) defines “employment purposes” to mean “a report used for the 

purpose of evaluating a consumer for employment, promotion, reassignment or 

retention as an employee.”

1. RELATION TO OTHER SECTIONS

The term “employment purposes” is used as part of the definition of “consumer reports” (section 

603(d)) and as a permissible purpose for the furnishing of consumer reports (section 604(a)(3)(B)). 

When an employer procures reports for employment purposes, it must make certain certifications 

and disclosures, and obtain consumer consent. (See section 604(b). When a CRA furnishes public 

record information in reports “for employment purposes,” it must provide notice to the consumer or 

maintain strict procedures for keeping the information up to date. (See section 613.)70

2. INDEPENDENT CONTRACTORS, AGENTS, AND VOLUNTEERS

Because the term “employment purposes” is interpreted liberally to effectuate the broad remedial 

purpose of the FCRA, it may apply to situations where an entity uses individuals who are not 

technically employees to perform duties.71 Thus, it includes a trucking company that obtains 

consumer reports on individual drivers who own and operate their own equipment;72 a title 

insurance company that obtains consumer reports on individuals with whom it frequently enters 

into contracts to sell its insurance, examine title, and close real property transactions;73 or a 

nonprofit organization staffed in whole or in part by volunteers.74

3. SECURITY CLEARANCES

A consumer report used in connection with security clearances of a government contractor’s 

employees would be for “employment purposes” under this section.75

Section 603(i)(1) defines the term “medical information” to mean “information or 

data, whether oral or recorded, in any form or medium, created by or derived 

from a health care provider or the consumer, that relates to (A) the past, present, 

or future physical, mental, or behavioral health or condition of an individual; (B) 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

the provision of health care to an individual; or (C) the payment for the provision 

of health care to an individual.” Section 603(i)(2) excludes identifying and other 

non-germane information, “including the existence or value of any insurance 

policy.”

1. RELATION TO OTHER SECTIONS

Sections 603(d)(3), 604(g), 605(a)(6), and 623(a)(9) set forth standards concerning the use or 

communication of medical information. The Federal financial agencies have issued rules specifying 

“necessary and appropriate” uses of medical information. See comment 604(g)-1.

Section 603(j) sets forth definitions with respect to child support obligations.

Section 603(k)(1) defines the term “adverse action.”

1. RELATION TO OTHER SECTIONS

The term “adverse action” is defined in the credit context by section 603(k)(1)(A), in the insurance 

context by section 603(k)(1)(B)(i), in the employment context by section 603(k)(1)(B)(ii), in the 

context of a license or benefit granted by the government by section 603(k)(1)(B)(iii), and in other 

contexts by section 603(k)(1)(B)(iv). The subsections of the “adverse action” definition in section 

603(k)(1) thus parallel the permissible purposes provided for credit, insurance, employment, 

governmental benefit or license, and other consumer purposes provided in section 604(a)(3).76 See 

comment 604(a)-1. 

Section 615(a) requires users of consumer reports to provide notice to consumers against whom 

they take “adverse action” based in whole or in part on a consumer report. Section 615(b) imposes 

notice requirements on creditors who take “adverse action” based on information other than 

consumer reports. 

Section 603(k)(1)(A) states that the term adverse action “has the same meaning 

as in section 701(d)(6) of the Equal Credit Opportunity Act.”

1. RELATION TO OTHER LAWS

Under regulations implementing the Equal Credit Opportunity Act (“ECOA”), an “adverse action” 

is “a refusal to grant credit in substantially the amount or on substantially the same terms requested 

in an application unless the creditor makes a counteroffer (to grant credit in a different amount or 

on other terms) and the applicant expressly accepts the credit offered ....” 12 CFR § 202.2(c)(1)(i).

2. ACTION ON CREDIT APPLICATION

Under the definition of “adverse action” set forth in the ECOA and incorporated into the FCRA, 

where a consumer applies for credit on particular terms and is offered credit only on less favorable 

terms, such as a lower credit limit, or a higher interest rate, based in whole or in part on information 

from a consumer report, and the consumer refuses to accept those terms or use the credit offered, 

the consumer has suffered an “adverse action.” (An example of an application for credit on 

particular terms is an application that provides information regarding the type and amount of credit 

sought, the down payment amount, and the annual percentage rate.) However, if the applicant 

accepts the less favorable terms counter offered, the applicant does not suffer an “adverse action.”77

See also comments 615(a)-1B, 615(a)-2A, and 615(h) concerning “risk based pricing” notices 
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provided to credit applicants who receive less than optimal terms in whole or in part because of a 

consumer report.

3. PRIMARY CREDIT APPLICANT, CO-APPLICANT, AND GUARANTOR

Because the FCRA adopts the definition of “adverse action” from the ECOA, only an “applicant” 

experiences “adverse action” in the context of a credit transaction. See 12 CFR § 202.2(c)(1). 

A co-applicant is an “applicant” but a guarantor is not. 12 CFR. § 202.2(e). Therefore, where a 

creditor denies an application, both the primary applicant and any co-applicant have suffered an 

“adverse action,” but any guarantor has not. See comment 615(a)-2B.78

4. DECISION NOT TO SOLICIT FOR CREDIT

It is not an “adverse action” for a creditor to decide not to include a current borrower in a credit 

solicitation based in whole or in part on the creditor’s review of consumer report information 

because that decision does not involve either (a) an “application” by the consumer or (b) a 

termination of the consumer’s account or an unfavorable change in the terms of that account. 

12 CFR §202.2(c)(1)(i-ii).79

Section 603(k)(1)(B)(i) defines the term adverse action as including “a denial or 

cancellation of, an increase in any charge for, or a reduction or other adverse or 

unfavorable change in the terms of coverage or amount of, any insurance, existing 

or applied for, in connection with the underwriting of insurance.”

1. INITIAL PREMIUM

The term “increase in any charge for” insurance applies to the initial premium charged to the 

consumer, as well as to a premium that is raised during the term a policy is in effect. If an insurer 

considers an applicant’s credit history (or a score based on that history) as part of the application 

process, and offers a higher premium than it would otherwise have offered, the higher premium 

is an “increase in (the) charge for” insurance. The consumer has suffered an adverse action 

because the insurance would cost more than it would if the consumer’s credit history had not been 

considered.

2. MORTGAGE INSURANCE

A mortgage insurer’s refusal to insure a consumer loan is an “adverse action” under this subsection 

because it is a “denial in connection with the underwriting of insurance.”80

Section 603(k)(1)(B)(ii) defines the term adverse action as including “a 

denial of employment or any other decision for employment purposes 

that adversely affects any current or prospective employee.”

1. RELATION TO OTHER SECTIONS

The term “employment purposes” is defined in section 603(h).

2. DISCIPLINARY ACTION TAKEN BY AN EMPLOYER

Corrective or disciplinary action taken by an employer based in whole or in part on a consumer 

report is an “adverse action.”81
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

3. CHANGE IN DUTIES OR STATUS

An employer’s decision may “adversely” affect an employee even if his or her pay is not 

reduced. For example, an employee who is denied an assignment requiring a security clearance 

that is withheld in whole or in part because of a consumer report suffers an “adverse action” in 

employment even if the assignment would not have raised the employee’s salary.

Section 603(k)(1)(B)(iii) defines the term adverse action as including “a denial or 

cancellation of, an increase in any charge for, or any other adverse or unfavorable 

change in the terms of, any license or benefit described in section 604(a)(3)(D).”

1. GENERAL

Subsection 603(k)(1)(B)(iii) provides a specific “adverse action” definition in the context of a 

consumer’s application for a license or other governmental benefit where the applicant’s financial 

responsibility or status is a factor that must be considered. 

2. WORKER’S COMPENSATION CLAIM

The use of information from a consumer report to deny worker's compensation benefits to the 

consumer or to grant less than the amount claimed is an “adverse action.”82

Section 603(k)(1)(B)(iv) defines the term adverse action as including “an action 

taken or determination that is (I) made in connection with an application that was 

made by, or a transaction that was initiated by, any consumer, or in connection 

with a review of an account under section 604(a)(3)(F)(ii); and (II) adverse to the 

interests of the consumer.”

1. GENERAL

Subsection 603(k)(1)(B)(iv) provides a specific “adverse action” definition in the context of 

consumer transactions other than those involving credit, insurance, employment or government 

benefits, such as an apartment rental or a purchase by personal check.

2. ACTION BASED ON CO-SIGNER’S OR GUARANTOR’S REPORT

A landlord’s decision to deny a rental application based on a co-signer or guarantor’s consumer 

report is an “adverse action” with respect to the co-signer or guarantor. By voluntarily assuming 

liability for the tenant’s rental payments, a co-signer or guarantor seeks to ensure that the tenant 

receives housing, as in the case of a parent who co-signs a rental application submitted by a son or 

daughter. The rejection is thus “adverse” to the “interests” of the potential co-signor or guarantor.83

But see comments 603(k)(1)(A)-3 and 615(a)-2B, concerning the application of “adverse action” to 

a guarantor in a credit context where the definition is tied to the ECOA.

3. DEPOSIT REQUIREMENT 

A business that determines, based on information contained in a consumer report, that a consumer 

must pre-pay, pay a cash deposit, or pay a larger deposit rather than would normally be required, 

has taken adverse action against that consumer.84
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

4. ACTION ON RESIDENTIAL RENTAL APPLICATION

A residential property owner that denies a consumer’s application to rent an apartment, or charges 

a higher rent, or requires a larger deposit, based in whole or in part on a consumer report, has taken 

adverse action with respect to that consumer.

Section 603(k)(2) provides that all appropriate Bureau findings, decisions, 

commentary, and orders issued under “section 701(d)(6) of the Equal Credit 

Opportunity Act” shall apply for the purposes of determining whether an adverse 

action has taken place.

1. EQUAL CREDIT OPPORTUNITY ACT

The Equal Credit Opportunity Act is codified at 16 U.S.C. 1691 et seq., and implemented by 

Regulation B, 12 CFR. Part 202. See comment 603(k)(1)(A)-1.

Section 603(l) defines the term “firm offer of credit or insurance” to mean “any 

offer of credit or insurance to a consumer that will be honored if the consumer is 

determined, based on information in a consumer report on the consumer, to meet 

the specific criteria used to select the consumer for the offer.” In general, once a 

consumer accepts such an offer, the entity making the offer cannot condition it on 

further consumer report information, except that it can verify that the consumer 

continues to meet the criteria established before the firm offer is extended. 

1. RELATION TO OTHER SECTIONS

“Firm offer of credit or insurance” is the term used in the FCRA for “prescreened” solicitations. 

Section 603(l) defines the parameters of a firm offer. Section 604(c) provides the permissible 

purpose for prescreening, and imposes some limitations on the information that a CRA may provide 

for the purpose of making prescreened offers. Section 604(e) discusses the consumer’s right to 

opt out from prescreened lists. Section 615(d) sets forth the disclosures that users of prescreening 

services must make to consumers on written solicitations.

2. PRESCREENING

“Prescreening” is the common term for the process by which creditors and insurers use consumer 

report information to identify consumers to receive firm offers. Prescreening is the only 

circumstance in which consumer report information may be used for marketing purposes, and one 

of the few circumstances in which consumer report information may be provided in the absence 

of a consumer-initiated transaction. A CRA either edits a list of consumers developed by the 

requesting creditor or insurer (or its agents) or independently creates a list of consumers according 

to the requesting entity’s specifications. 

3. USE OF CONSUMER REPORTS IN POSTSCREENING

The use of consumer report information in the postscreening process is limited to verifying that 

consumers continue to meet the criteria established and used before the firm offer is communicated 

to consumers on the list. Therefore, a credit grantor may not employ a two-step process where a 

CRA first provides a list of all consumers who have credit scores above a certain minimal level 

for the initial offer, and then provides each responding consumer’s report to enable the creditor 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

to postscreen by applying new, more refined criteria to set the interest rate or to determine other 

specifics of the offer.

4. TIERED LISTS

A user of prescreening lists may have the CRA provide separate or tiered lists for consumers who 

meet different criteria, and make different offers of credit or insurance to the consumers depending 

on which criteria the consumers meet.

5. OFFER OF CREDIT COMBINED WITH SALE OF GOODS OR SERVICES

The FCRA does not establish a permissible purpose to obtain a consumer report in situations not 

involving an actual offer of credit or insurance, such as where an apparent offer of credit is actually 

a sham used to engage in the targeted marketing of a non-credit product, or is some other guise 

to obtain a consumer report for an impermissible purpose. Typically, this would not arise in cases 

involving stand-alone credit offers, but rather in situations where the purported offer of credit is 

accompanied by, and perhaps linked to, the marketing of a non-credit product. For example, an 

offer of $1 in credit toward the purchase of a BMW is, in reality a marketing pitch masquerading as 

an offer of credit, and there would be no permissible purpose under the FCRA to obtain a consumer 

report for such purposes.

Where there is reason to suspect, based on the credit offer and other factors, that the person making 

the apparent offer is engaged in a ruse to obtain a consumer report for an impermissible purpose, 

one looks at the entire proposed transaction in determining whether or not there is a permissible 

purpose or a sham offer. The salient factors include (i) the type of credit offered, (ii) the purposes 

for which the credit may be used, including whether the credit is restricted to the financing of a 

non-credit product marketed jointly with the credit, (iii) the likelihood that the credit would be 

adequate to achieve those purposes, and (iv) whether any consumers applied for and received the 

credit.85

6. TERMS OF THE FIRM OFFER OF CREDIT

The FCRA does not require a lender, in the initial solicitation, to disclose the terms of the credit an 

individual consumer will receive in order for the solicitation to meet the “firm offer” requirements. 

The only term that this section requires to be specified in the offer is the collateral, if any, that is 

required for the credit to be provided. The creditor must also include all the disclosures required by 

section 615(d) in written solicitations to consumers identified by prescreening.

Section 603(m) states that the term “credit or insurance transaction that is not 

initiated by the consumer” does not include the use of a consumer report by a 

person with whom the consumer has an account or insurance policy, for purposes 

of (1) reviewing the account or insurance policy; or (2) collecting the account.

1. GENERAL

Section 604(c) provides that, generally, it is not a permissible purpose to provide a consumer report 

in connection with “any credit or insurance transaction not initiated by the consumer” unless the 

consumer consents or the transaction consists of a firm offer of credit or insurance. However, an 

existing creditor’s use of consumer reports for review or collection of its accounts does not fall 

within the definition of “credit or insurance transaction that is not initiated by the consumer.” 

Rather, an existing creditor may obtain consumer reports for review or collection of its accounts 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

under section 604(a)(3)(A), but its use of those reports is limited to that purpose. Accordingly, 

a CRA may provide reports to creditors to review or collect existing credit accounts, but not to 

market other products or services.86 See comment 604(a)(3)(A)-4A.

Section 603(n) defines the term “State” to mean any State, the Commonwealth of 

Puerto Rico, the District of Columbia, and any territory or possession of the United 

States.

Section 603(o) states that certain employment agency communications are 

exempt from the definition of “consumer report,” where the agency follows 

prescribed procedures to provide prior notice to, and obtain prior consent from, 

consumers.

1. EMPLOYMENT AGENCIES

This section exempts from the FCRA communications by employment agencies engaged in 

procuring (a) jobs for applicants or (b) employees for employers.87

2. EMPLOYMENT SCREENING SERVICES

The exemption does not apply to an employment screening service that conducts reference checks 

on behalf of employers in connection with employment applications.88 See comment 603(f)-3C.

Section 603(p) defines the term “consumer reporting agency that compiles 

and maintains files on consumers on a nationwide basis” to mean a consumer 

reporting agency that regularly assembles, evaluates, and maintains public record 

information and credit account information on a regular basis about consumers 

residing nationwide.

1. RELATION TO OTHER SECTIONS

A CRA that meets this definition has different duties from other CRAs in some cases. Section 

604(e)(6) requires nationwide CRAs to maintain a joint system to enable consumers to opt out from 

prescreening with a single call. Sections 605(h) and 605A impose several duties on nationwide 

CRAs designed to reduce or mitigate consumer injury due to identity theft. Section 609 requires 

nationwide CRAs to maintain a toll-free phone number. Section 611(a)(5)(D) requires nationwide 

CRAs to maintain an automated system to enable them to notify other CRAs when investigation of 

an item reveals an inaccuracy. 

Section 612(a) imposes “free annual disclosure” duties on nationwide CRAs. Comment 612(a)-2

discusses how those duties differ from those imposed on CRAs described in Section 603(x), which 

defines “nationwide specialty consumer reporting agency” to include different types of CRAs from 

those defined under this section. 

2. HISTORICAL BACKGROUND

The legislative history indicates that Congress expected this term to apply to the “big three” 

national CRAs that existed when this section was enacted in 1996, and to others that meet the 

definition in the future. 140 Cong. Rec. 25,871 (1994) (statement of Rep. Kennedy).
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

3. RESELLERS

A CRA whose business consists solely of obtaining credit reports from other CRAs for resale (e.g.,

in mortgage transactions) is not a “nationwide” CRA if it does not maintain files on consumers 

on a nationwide basis and does not receive credit account information from creditors on a regular 

basis.89 See comment 603(u)-1 concerning the term “reseller” and sections that impose duties on 

such parties. 

Section 603(q) defines the following terms relating to fraud alerts – active duty 

military consumer, fraud alert, active duty alert, identity theft, identity theft report, 

and new credit plan. Sections 603(q)(3) and (4) authorized the Commission to 

further define “identity theft” and “identity theft report.” Starting July 21, 2011, the 

Bureau assumes rulemaking authority under this provision.

1. RELATION TO OTHER SECTIONS

The defined terms are used in sections 605A (“Identity theft prevention; fraud alerts and active duty 

alerts”), 605B (“Block of information resulting from identity theft”), 609(b) (“Summary of rights 

of identity theft victims”), 609(e) (“Information available to victims”), 615(e) (“Red flag guidelines 

and regulations required”), and 623(a)(6) (“Duties of furnishers upon notice of identity theft-related 

information”), which are designed to prevent identity theft and assist consumers who have been the 

victims of identity theft. 

2. IMPLEMENTING RULES

The terms “identity theft” and “identity theft report” are further defined by Commission rule (16 

CFR 603.2 and 603.3). See 69 Fed Reg. 63922, 63933 (Nov. 3, 2004).

Section 603(r) defines the following credit and debit related terms – card issuer, 

credit card, debit card, account, electronic fund transfer, credit, and creditor. 

Section 603(s) states, “The term ‘Federal banking agency’ has the same meaning 

as in section 3 of the Federal Deposit Insurance Act” which in turn defines the 

term to mean the Comptroller of the Currency, the Director of the Office of Thrift 

Supervision, the Board of Governors of the Federal Reserve System, or the Federal 

Deposit Insurance Corporation.

Section 603(t) defines “financial institution” as “a State or National bank, a State 

or Federal savings and loan association, a mutual savings bank, a State or Federal 

credit union” or anyone else that holds a transaction account (such as a checking 

account) belonging to a consumer.

Section 603(u) defines “reseller” as a CRA that (1) assembles and merges 

information from other consumer reporting agencies for purposes of furnishing 

such information to third parties; and (2) does not maintain a database of the 

assembled or merged information.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

1. RELATION TO OTHER SECTIONS

A CRA that is a “reseller” has somewhat different duties from other CRAs in some situations. 

Section 605A(f) requires resellers of consumer reports with any alerts in the file to include them 

in resold reports. Section 605B(d) provides different blocking obligations for resellers than other 

CRAs. Section 611(f) provides different investigation duties for resellers than other CRAs. 

Section 603(v) defines “Commission” as the Federal Trade Commission.

Section 603(w) defines “Bureau” as the Bureau of Consumer Financial Protection. 

Section 603(x) defines “nationwide specialty consumer reporting agency” as 

a CRA “that compiles and maintains files on consumers on a nationwide basis 

relating to (1) medical records or payments; 2) residential or tenant history; (3) 

check writing history; (4) employment history; or (5) insurance claims.”90

1. RELATION TO OTHER SECTIONS

Section 612(a) imposes “free annual disclosure” duties on nationwide specialty CRAs. Comment 

612(a)-2 discusses how those duties differ from those imposed on CRAs described in Section 

603(p), which defines “nationwide consumer reporting agency” to include different types of CRAs 

from those defined under this section. 

Section 603(y)(1) excludes from the definition of “consumer report” those reports 

made solely for the purpose of investigating (1) suspected employment misconduct 

or (2) compliance with applicable laws or rules or “any pre-existing written policies 

of the employer.” Section 603(y)(2) requires that an employer that has taken 

adverse action based on such a report provide the employee a summary of the 

“nature and substance” of the information. 

1. PRE-EXISTING WRITTEN POLICIES

The term “pre-existing written policies of the employer” means reasonable rules relating to the job. 

A report qualifies under this section only if it bears on compliance with the policy.

2. “NATURE AND SUBSTANCE”

The adverse action disclosure of a summary of the “nature and substance” of the communication 

need not name information sources. 

Section 604 – Permissible Purposes of Reports 15 USC 1681b

Section 604(a) says that “any consumer reporting agency may furnish a consumer 

report under the following circumstances and no other ....” Its subsections 

enumerate specific permissible purposes.

1. RELATION TO SECTION 603(d) (DEFINITION OF “CONSUMER REPORT”)

Sections 603(d)(1) and 604(a)(3) must be construed together to determine what are “permissible 

purposes,” because section 603(d)(1) refers to any “purpose authorized under section 604” (often 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

described as “permissible purposes” of consumer reports). In addition, some permissible purposes 

are enumerated in section 603(d)(1)(A) and 603(d)(1)(B).91

2. RELATION TO OTHER SECTIONS

A. CRA procedures. Section 607(a) requires CRAs to safeguard consumer report information by 

furnishing consumer reports only for permissible purposes, and to follow specified, reasonable 

procedures to achieve this end.92

B. Improper procurement of consumer reports. Section 604(f) prohibits the use or procurement 

of a consumer report without a permissible purpose. Section 619 provides criminal sanctions 

against any person who knowingly and willfully obtains information on a consumer from a 

CRA under false pretenses.93

C. Government agencies. Section 608 allows CRAs to provide government agencies specified 

identifying information concerning consumers, notwithstanding the limitations of section 

604.94 Section 626 requires CRAs to provide consumer reports or specific information in 

their files to the Federal Bureau of Investigation in connection with investigations relating 

to international terrorism or clandestine intelligence activities. Section 627 allows CRAs to 

provide all information in their files to government agencies conducting such investigations.

D. Prescreening. Section 604(c) allows CRAs to provide creditors and insurers with limited 

information in the context of prescreening services. 

3. FURNISHING OF CONSUMER REPORTS TO OTHER CRAS

A CRA may furnish a consumer report to another CRA, so that the second CRA can sell such 

reports to subscribers with a permissible purpose. In these circumstances, the receiving CRA must 

carry out the responsibilities of companies that procure reports for resale, as set forth in section 

607(e). If the CRA meets the definition of “reseller,” it must also comply with provisions imposed 

on “resellers.” See comment 603(u)-1.95 The CRA that distributes consumer reports to other CRAs 

also must comply with FCRA requirements to implement reasonable policies and procedures to 

limit the distribution of consumer reports to those with permissible purposes. Among other things, 

such policies and procedures could include internal programs such that each intermediary relied 

upon by a CRA for distribution of consumer reports is audited and monitored on a regular and 

periodic basis.

4. REPORT FOR PERMISSIBLE PURPOSE AUTHORIZED, NOT REQUIRED

Even if a business has a permissible purpose to receive a consumer report, a CRA is not required to 

supply a report to such business because the statute is permissive, not mandatory.96

5. AGENTS 

A. General. An agent of a party with a “permissible purpose” may obtain a consumer report 

where he is acting on behalf of his principal for that purpose.97

B. Real estate agent. A real estate agent may obtain a consumer report on behalf of a seller to 

evaluate the eligibility of a potential buyer who has offered to purchase the property.98

C. Private detective agency. A private detective agency may obtain a consumer report for its client 

while investigating a client’s prospective employee. A private detective agency may obtain 

a consumer report as an agent for a creditor client attempting to collect an account owed. In 

these circumstances, the detective agency is acting on behalf of its client.99
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D. Property manager. A landlord’s representative investigating applicants for apartment rentals 

may obtain consumer reports on prospective tenants.100

E. Attorney. An attorney collecting a debt for a creditor client has a permissible purpose to obtain 

a consumer report on the debtor to the same extent as the client.101

6. PURPOSES NOT ALLOWED BY THE FCRA 

A. General prohibition. Because this section allows a CRA to provide a consumer report for the 

listed purposes “and no other,” it may not provide a report for any other purpose.

B. Marketing. Sellers of goods and services do not have a permissible purpose to obtain consumer 

reports for marketing purposes. But see sections 603(l) and 604(c), which allow CRAs to 

provide creditors and insurers limited information for firm offers of credit or insurance.

C. Curiosity. A CRA may not furnish a consumer report to satisfy a requester’s curiosity. A 

news reporter does not have a permissible purpose to obtain a consumer report in preparing a 

newspaper or magazine article.102

D. Acceptance of free trial. A consumer’s acceptance of a complimentary product or service, 

standing alone (i.e., with no indication of intent to purchase additional products or services on 

credit), is insufficient to provide a permissible purpose.103

E. Law enforcement. This section does not permit CRAs to furnish consumer reports for the 

purpose of locating a person suspected of committing a crime. But see section 608 (permitting 

the furnishing of specified, limited identifying information to governmental agencies) and 

sections 625-627 (requiring CRAs to provide consumer report data in cases involving 

counterintelligence and counterterrorism).104 See comment 604(a)-2C.

7. CONSUMER’S PERMISSION NOT NEEDED WHERE OTHER PERMISSIBLE PURPOSE EXISTS

Generally, when permissible purposes other than employment exist, CRAs may furnish consumer 

reports without a consumer’s specific permission or authorization. For example, where a consumer 

applies for credit (by phone, mail, in person, or electronically), the creditor has a permissible 

purpose to obtain a consumer report on the applicant. Similarly, consumer permission is not needed 

for entities to furnish information concerning their transactions with consumers to CRAs, or for 

CRAs to gather information.105

8. USER MAY DISCLOSE REPORT TO CONSUMER 

The FCRA does not prohibit a consumer report user from providing a copy of the report, or 

otherwise disclosing it or any item or items of information in it (or any score based on the 

information), to the consumer who is the subject of the report.106 See also section 607(c).

Section 604(a)(1) allows CRAs to furnish consumer reports in response to the 

“order of a court having jurisdiction to issue such an order, or a subpoena issued 

in connection with proceedings before a Federal grand jury.”

1. SUBPOENA

A subpoena is not an “order of a court” unless it is signed by a judge. Thus, administrative 

subpoenas, attorney-issued subpoenas, and similar formal process issued by entities other than a 

federal grand jury, do not provide a permissible purpose under this section.107
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

2. INTERNAL REVENUE SERVICE SUMMONS

An Internal Revenue Service summons is an exception to the requirement that an order be signed 

by a judge before it constitutes an “order of a court” under this section, because another statute 

(26 U.S.C. §7609) specifically requires a CRA to furnish a consumer report in response to an IRS 

summons.108 See comment 604(a)-1C, concerning specific provisions of the FCRA that allow or 

require CRAs to supply information to governmental entities.

Section 604(a)(2) allows CRAs to furnish consumer reports in accord “with the 

written instructions of the consumer to whom it relates.”

1. CONSUMER INSTRUCTION

A consumer’s written consent qualifies as an “instruction” that provides a permissible purpose 

under this section if it clearly authorizes the issuance of a consumer report on that consumer.

109

For example, a consumer’s clear and specific written statement that “I authorize you to procure 

a consumer report on me” provides a permissible purpose under this section. However, the 

consumer’s signature on a form that includes the statement “I understand that where appropriate, 

credit bureau reports may be obtained” is not a sufficiently specific instruction from the consumer 

to authorize a CRA to provide a consumer report. This language is more in the nature of a 

notification that a consumer report might be procured, as opposed to a grant of permission to obtain 

the consumer report.110

2. WRITTEN AUTHORIZATION

A consumer may transmit “written” authorization electronically or by facsimile, in addition 

to regular mail or in person.111 The Electronic Signatures in Global and National Commerce 

Act (“ESIGN”) (15 U.S.C. §§7001 et seq., Public Law 106-229; June 30, 2000) provides that 

a consumer’s consent is not invalid merely because it is communicated in electronic form. A 

consumer’s “electronic signature” may be an acceptable method of providing “written instructions” 

under the FCRA. To be valid under the ESIGN Act, electronic authorization must be in a form that 

can be retained and retrieved in a perceivable form. Whether an e-mail, a mouse click “yes,” or 

other electronic means clearly conveys the consumer’s instructions depends on the specific facts.112

Section 604(a)(3)(A) allows a CRA to furnish consumer reports to a person which 

it has reason to believe “intends to use the information in connection with a credit 

transaction involving the consumer on whom the information is to be furnished and 

involving the extension of credit to, or review or collection of an account of, the 

consumer”

1. REPORTS “IN CONNECTION WITH A CREDIT TRANSACTION INVOLVING THE CONSUMER”

A. Credit application. An application by a consumer for credit gives rise to a permissible purpose 

to obtain a consumer report, regardless of form. When a consumer applies for credit, whether 

in person, by phone, by mail, or by electronic means, the creditor has a permissible purpose to 

obtain a consumer report on the applicant, and thus does not need specific authorization from 

the applicant.113

B. Real estate transactions. A seller of property has a permissible purpose under this subsection 

to obtain a consumer report on a prospective purchaser to whom the seller has been requested 
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to extend credit.114 Similarly, a real estate agent acting on behalf of a seller with a permissible 

purpose may obtain the consumer report.115

2. INFORMATION ON AN APPLICANT’S SPOUSE

A. Where permissible purpose exists. A creditor has a permissible purpose to obtain a consumer 

report on an applicant’s spouse if that spouse will be permitted to use the account or will be 

contractually liable upon the account, or if the applicant is relying on the spouse’s income as 

a basis for repayment of the credit requested. In addition, a creditor may obtain a consumer 

report on an applicant’s spouse if (i) the state law doctrine of necessaries (which may make 

a consumer liable for certain debts of a spouse) applies to the transaction, (ii) the applicant 

resides in a community property state, (iii) the property upon which the applicant is relying as 

a basis for repayment of the credit requested is located in such a state, or (iv) the applicant is 

acting as the agent of the nonapplicant spouse.116

B. Where permissible purpose does not exist. A creditor does not have a permissible purpose 

to obtain a report on a nonapplicant spouse if the creditor receives information indicating 

that (i) the applicant is not acting as the agent of the nonapplicant spouse, (ii) the applicant 

is relying only on separate property to repay the credit extended, (iii) the state law doctrine 

of necessaries does not apply to the transaction, or (iv) the applicant does not reside in a 

community property state. Where Regulation B, issued under the ECOA (12 CFR 202), 

prohibits the creditor from requesting information on such a spouse, a permissible purpose for 

making a consumer report on a nonapplicant spouse can never exist under the FCRA. There 

is no permissible purpose to obtain a consumer report on a nonapplicant former spouse or on 

a nonapplicant spouse who has legally separated or otherwise indicated an intent to legally 

disassociate with the marriage. (This does not preclude reporting a prior joint credit account 

of former spouses for which the spouse that is the subject of the report is still contractually 

liable.)117

3. REPORTS FOR “REVIEW OR COLLECTION OF AN ACCOUNT” – PERMISSIBLE PURPOSE EXISTS

A. Creditor. In order for a creditor to have a permissible purpose to obtain a consumer report to 

review an account, it must have an existing credit account with the consumer and must use the 

consumer report solely to consider taking action with respect to the account (e.g., modifying 

the terms of an open end account).118 A creditor has a permissible purpose to obtain a consumer 

report on one of its customers for the purpose of review of the account, even where the 

customer has sought to discharge his/her debt in bankruptcy. A creditor who is deciding 

whether to participate in a debt management plan which would involve the cooperation of all 

of the consumer’s creditors has a permissible “review” purpose under this section.

B. Debt collection. A collection agency, detective agency, private investigator, or attorney has a 

permissible “collection” purpose under this section to obtain a consumer report on a consumer 

for use in obtaining payment of that consumer’s account on behalf of a creditor.119 A creditor 

may obtain a consumer report on an existing account to formulate its collection strategy. An 

attorney collecting a debt for a creditor client has a permissible purpose to obtain a consumer 

report on the debtor to the same extent as the client.120

C. Bad checks. A person attempting to recover the amount due on a bad check is attempting to 

collect a debt and, therefore, has a permissible purpose to obtain a consumer report on the 

consumer who wrote it, and on any other consumer who is liable for the amount of that check 

under applicable state law.121
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

4. REPORTS FOR “REVIEW OR COLLECTION OF AN ACCOUNT” – PERMISSIBLE PURPOSE DOES NOT 

EXIST

A. Marketing purposes. This section does not allow a CRA to provide a creditor with consumer 

reports to “review” accounts in order to market its other products or services.122 See also 

comments 603(m)-1 and 604(a)(3)(F)-6. 

B. Paid off and closed accounts. Once an account is paid off and closed, the creditor does not 

have a permissible purpose for obtaining a consumer report from a CRA because there no 

longer exists any account to “review.”123

C. Unsolicited reports. A CRA may not send an unsolicited consumer report to the recipient of 

a previous report on the same consumer, because the recipient will not necessarily have an 

account with the consumer that provides a permissible purpose to receive the unsolicited 

report. For example, the recipient may have rejected the consumer’s application or ceased 

to do business with the consumer. (See also discussion in comment 607(a)-3G)124 However, 

upon the consumer’s request, a CRA must furnish notifications to prior recipients required by 

section 611(d) when an item is deleted or is the subject of a dispute statement as a result of the 

CRA’s investigation.

D. Automobile dealer. An automobile dealer does not have a permissible purpose to obtain a 

consumer report on a consumer who simply asks for information about vehicles and prices, 

because there is no “credit transaction involving the consumer” at that point in time. For the 

same reason, the dealer will usually not have a permissible purpose when the consumer test 

drives one or more vehicles.125 See also discussion in comment 604(a)(3)(F)-5.

E. Tax obligations. A tax collection agency does not have a permissible purpose to obtain a 

consumer report to collect delinquent tax accounts because this section applies only to “credit” 

accounts. However, if a consumer taxpayer entered an agreement with a tax collection agency 

to pay taxes, that agreement may create a debtor-creditor relationship, thereby giving the 

agency a permissible purpose to obtain a consumer report on that consumer.126

5. COMMERCIAL TRANSACTIONS – REPORTS ON PRINCIPALS OF A BUSINESS ENTITY

A lender has a permissible purpose to obtain a consumer report on a consumer in connection 

with a business credit transaction when the consumer is or will be personally liable on the loan 

as a co-signer or guarantor, because such a transaction involves the “extension of credit to ... the 

consumer” by virtue of the individual’s liability. A lender would not have a permissible purpose 

to obtain a consumer report on a consumer who will not be personally liable for repayment of the 

credit (even an individual proprietor, shareholder, director, or officer of a corporation), because 

this section does not include the extension of credit to commercial entities.127 If a consumer has 

executed a promissory note reflecting an obligation to make capital contributions to a limited 

partnership, and that individual defaults, the creditor has a permissible purpose for obtaining the 

consumer report of the individual.

Section 604(a)(3)(B) allows a CRA to furnish consumer reports to a person which 

it has reason to believe “intends to use the information for employment purposes.”

1. RELATION TO OTHER SECTIONS

This subsection establishes that CRAs may provide reports for employment purposes. Section 

604(b) imposes certain duties on employers and CRAs in such cases.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

2. CURRENT EMPLOYEES

An employer may obtain a consumer report on a current employee, provided that the employer 

has obtained prior, written authorization, because “promotion, reassignment, or retention as an 

employee” is included in the definition of “employment purposes” (section 603(h)).128

3. GRAND JURORS

The fact that grand jurors are usually paid a stipend for their service does not provide a district 

attorney’s office a permissible purpose for obtaining consumer reports on them, because the 

consumer does not seek such service, which is a duty.129

Section 604(a)(3)(C) allows a CRA to furnish consumer reports to a person which 

it has reason to believe “intends to use the information in connection with the 

underwriting of insurance involving the consumer.”

1. PERMISSIBLE PURPOSE EXISTS FOR “UNDERWRITING OF INSURANCE”

An insurer may obtain a consumer report to determine whether or not to issue a policy to the 

consumer, the amount and terms of coverage, the duration of the policy, the rates or fees charged, 

or whether or not to renew or cancel a policy, because these are all “underwriting” decisions.130

An insurance company has a permissible purpose to obtain a consumer report to determine 

whether existing policy holders qualify for a different premium upon renewal, because that is an 

“underwriting” decision.131

2. PERMISSIBLE PURPOSE DOES NOT EXIST FOR EVALUATING INSURANCE CLAIMS

An insurer may not obtain a consumer report for the purpose of evaluating a claim (to ascertain its 

validity or otherwise determine what action should be taken), because permissible purposes relating 

to insurance are limited by this section to “underwriting” purposes.132

Section 604(a)(3)(D) allows a CRA to furnish consumer reports to a person 

which it has reason to believe “intends to use the information in connection with a 

determination of the consumer’s eligibility for a license or other benefit granted by 

a governmental instrumentality required by law to consider an applicant’s financial 

responsibility or status.”

1. GENERAL 

Any person charged by law with responsibility for assessing the consumer’s eligibility for a 

government benefit (not only the agency directly responsible for administering the benefit) has a 

permissible purpose to obtain a consumer report. 

2. APPROPRIATE RECIPIENTS

A. Financial status. A social services agency, required by law to consider a consumer’s financial 

status in determining whether that consumer qualifies for social service benefits, has a 

permissible purpose to obtain a report on the consumer for that purpose. Similarly, government 

entities that are required by law to consider financial status in determining consumers’

eligibility for assistance, and professional boards required by law to consider such information 

on applicants for admission to practice, have a permissible purpose to obtain a consumer 

report.133
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

B. Continuing eligibility for benefit. A government agency has a permissible purpose to obtain a 

consumer report to determine a consumer’s continuing eligibility for a benefit or to conduct a 

random check to confirm continued eligibility.134

C. Worker’s compensation claims. A state workers’ compensation fund may have a permissible 

purpose to obtain consumer reports on consumers who submit claims to the fund if (a) 

insurance payments paid by the fund constitute a “benefit” and (b) the fund is required by law 

to consider the claimants’ financial responsibility or status when deciding whether to make the 

payments.135

3. INAPPROPRIATE RECIPIENTS

A. Persons not charged with eligibility determination. No one other than the entity charged with 

the responsibility of determining a consumer’s eligibility for a license or other benefit has a 

permissible purpose to obtain a consumer report under this provision. For example, a party 

competing for an FCC radio station construction permit would not have a permissible purpose 

to obtain a consumer report on the other competitor.136

B. Purposes not related to government license or benefit. A state does not have a permissible 

purpose to obtain a consumer report of the officers, directors, or stockholders of a corporation 

submitting bids for a procurement contract, because the purpose for obtaining the report 

in those circumstances does not concern the consumer’s eligibility for a state “license” or 

“benefit,” but rather to assess the advisability of a commercial contractual relationship with a 

particular company. 

Section 604(a)(3)(E) allows a CRA to furnish consumer reports to a person which 

it has reason to believe “intends to use the information, as a potential investor or 

servicer, or current insurer, in connection with a valuation of, or an assessment of 

the credit or prepayment risks associated with, an existing credit obligation.”

Section 604(a)(3)(F) allows a CRA to furnish consumer reports to a person 

which it has reason to believe “otherwise has a legitimate business need for the 

information (i) in connection with a business transaction that is initiated by the 

consumer or (ii) to review an account to determine whether the consumer continues 

to meet the terms of the account.”

1. RELATION TO OTHER SUBSECTIONS OF SECTION 604(a)(3)

The issue of whether credit, employment, or insurance provides a permissible purpose is 

determined exclusively by reference to subsection (A), (B), or (C), respectively.137 Subsection (F)(i) 

provides a permissible purpose to businesses other than creditors, employers, or insurers to obtain 

a consumer report for use in connection with a transaction the consumer initiates that is not more 

specifically covered by subsections (A), (B), or (C).

2. “BUSINESS TRANSACTION”

The term “business transaction that is initiated by the consumer” in section 604(a)(3)(F)(i) means a 

business transaction that is primarily for personal, family, or household purposes. This section does 

not cover business transactions that involve purely commercial purposes.138
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

3. “LEGITIMATE BUSINESS NEED”

A. General. Section 604(a)(3)(F)(i) provides a permissible purpose to obtain a consumer report on 

a consumer for use in connection with a transaction the consumer initiates from which he or 

she might expect to receive a benefit that is not more specifically covered by subsections (A), 

(B), or (C), where the report user has a legitimate business need for the information.

B. Apartment rental. A landlord has a permissible purpose to obtain a consumer report on a 

consumer who applies to rent an apartment.139

C. Brokerage account. The provision authorizes a CRA to provide a report on an individual who 

applies to open a brokerage account.140

D. Personal check. A retailer has a permissible purpose to obtain a consumer report on a 

consumer who pays for merchandise (e.g., an automobile or TV set) by personal check.141

4. LITIGATION IS NOT A PERMISSIBLE PURPOSE

A. General. Litigation, whether threatened, possible, or ongoing, is not a “business transaction” 

and is not within the “legitimate business need” purpose provided by section 604(a)(3)(F)

(i). However, parties considering litigation may have a permissible purpose for obtaining a 

consumer report if the transaction that gives rise to the potential litigation would provide a 

permissible purpose for obtaining a consumer report. For example, a party seeking to sue on a 

credit account would have a permissible purpose under section 604(a)(3)(A).142

B. Potential defendants. This section does not provide parties considering litigation with a general 

permissible purpose to obtain reports on potential defendants to determine whether they are 

worth suing. Thus, there is no permissible purpose for a consumer report to be obtained on the 

potential defendant in a contemplated tort action.143

C. Attempt to locate wrongdoer or witness. An insurance company attempting to locate an 

uninsured automobile driver who was responsible for an auto accident with one of the 

insurance company’s insured does not have a permissible purpose for obtaining the uninsured 

driver’s consumer report. Neither does a company hired by the insurance company to locate 

the uninsured driver have a permissible purpose. Similarly, a consumer report may not be 

obtained solely for locating a witness or for use in discrediting a witness at trial.144

5. AUTOMOBILE DEALERSHIP

An automobile dealer does not have a permissible purpose to obtain a consumer report on 

a consumer who simply asks for information about vehicles and prices, because there is no 

“transaction ... initiated by the consumer” at that point in time. For the same reason, the dealer 

will usually not have a permissible purpose when the consumer test drives one or more vehicles.145

See also discussion in comment 604(a)(3)(A)-4D. The dealership would not have a permissible 

purpose under this provision to obtain a consumer report when a consumer pays for a vehicle in 

cash because it has no “legitimate business need” for the information.146 However, the dealer would 

have a permissible purpose if it obtained the consumer’s written instruction (comment 604(a)(2)-1) 

or the consumer offered to pay with a personal check (comment 604(a)(3)(F)-3D).

6. “REVIEW” PURPOSES

Section 604(a)(3)(F)(ii) provides a permissible purpose to banks that have a legitimate business 

need to consult a current customer’s consumer report in order to determine whether the terms of a 

consumer’s current non-credit (savings or checking) accounts should be modified.147 However, it 
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

does not allow CRAs to provide businesses with consumer reports to “review” accounts in order 

to market other products or services.148 As noted in comment 604(a)(3)(F)-1, subsection (F) does 

not apply to credit, insurance, and emplyment scenarios that are specifically covered by other 

subsections.

Section 604(a)(3)(G) allows CRAs to provide consumer reports to “executive 

departments and agencies in connection with the issuance of governmentsponsored individually-billed travel charge cards.”

Sections 604(a)(4) and 604(a)(5) permit child support authorities to obtain 

consumer reports on parents in connection with the assessment of child support 

obligations. One of the requirements for a child support enforcement agency to 

obtain a report is that it has to certify that it “has provided at least 10 days’ prior 

notice to the consumer whose report is requested by certified or registered mail to 

the last known address of the consumer.”

1. GENERAL

Sections 604(a)(4) and 604(a)(5) permit child support authorities to obtain consumer reports on 

parents in connection with the assessment or modification of child support obligations. 

2. NOTICE PROCEDURE

Section 604(a)(4)(C) requires only that the child support authority notify the report subject (usually 

a non-custodial parent who owes child support) by certified or registered mail. It does not require 

the agency to procure a signed receipt or to follow any additional procedures, such as service of 

process that would be required to bring a lawsuit.149

Section 604(a)(6) permits the Federal Deposit Insurance Corporation and 

National Credit Union Administration to obtain consumer reports in connection 

with their duties as conservator, receiver, or liquidating agent for failed or failing 

financial institutions under applicable laws.

Section 604(b) sets forth provisions relating to consumer reports for employment 

purposes, imposing specific duties on CRAs and employers in this context.

1. SCOPE OF “EMPLOYMENT PURPOSES”

Section 604(b)’s disclosure and authorization requirements apply where the consumer report is 

obtained for “employment purposes” even where the consumer is not technically an “employee” of 

the report user. See comment 603(h)-2.

2. SUSPECTED WORKPLACE WRONGDOING

An exclusion from the definition of “consumer report” in sections 603(d)(2)(D) and 603(y) 

removes certain reports from the scope of the FCRA when they are provided to employers for the 

sole purpose of investigating suspected employee workplace misconduct. Section 603(y) sets forth 

the specific procedures and limitations applicable to such reports.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

3. EMPLOYMENT AGENCIES

An exclusion from the definition of “consumer report” in sections 603(d)(2)(D) and 603(o) 

removes certain communications by employment agencies from the scope of the FCRA. Section 

603(o) sets forth the specific procedures and limitations applicable to such reports.

4. CRIMINAL RECORDS CHECK

An employer that obtains criminal or civil court records from a CRA (which may be a private 

investigator or record search firm) is “using consumer reports for employment purposes” and 

therefore must comply with section 604(b).150

5. PRIVATE INVESTIGATOR

An employer that hires a private investigator to conduct background investigations in which the 

investigator contacts persons identified by the applicant, and others whose names are discovered 

as inquiries are made (who can verify various kinds of information such as dates of employment, 

positions held, reasons for leaving, performance, character, or whether the person would be rehired) 

is required to comply with section 604(b).151 See also comment 603(f)-3C.

Section 604(b)(1) requires that, when a CRA furnishes a consumer report for 

employment purposes, it must obtain a certification from the user stating that the 

user (1) has obtained the consumer’s consent, (2) will provide the consumer with 

a copy of his or her report and a summary of rights under the FCRA before taking 

adverse action, and (3) will not use the report to violate employment opportunity 

laws.

1. GENERAL 

Section 604(b)(1) requires a CRA that provides consumer reports for employment purposes to 

obtain certification from an employer obtaining a report that it has made the proper disclosure to 

the consumer; has received the consumer’s written authorization to obtain the report; will comply 

with any adverse action requirements; and will not use any information contained in a consumer 

report in violation of any applicable federal or state equal opportunity law or regulation.152

Section 604(b)(2) provides that, except for employers in the trucking industry, 

a person may not obtain a consumer report for employment purposes unless the 

person makes “(i) a clear and conspicuous disclosure in writing to the consumer at 

any time before the report is procured or caused to be procured, in a document 

that consists solely of the disclosure, that a consumer report may be obtained 

for employment purposes; and (ii) the consumer has authorized in writing 

(which authorization may be made on the document referred to in clause (i)) the 

procurement of the report by that person.”

1. RELATION TO OTHER SECTIONS

A. Investigative consumer reports. Section 604(b)’s disclosure must be made before a consumer 

report – including an investigative consumer report as defined in section 603(e) – is requested 

for employment purposes, even though an additional disclosure for investigative consumer 

reports is also required by section 606.153
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AN FTC STAFF REPORT WITH SUMMARY OF INTERPRETATIONS

B. Employment reports with public record data. An employer must comply with the disclosure 

and consumer authorization requirements of section 604(b)(2), even where the consumer 

report is comprised of public records and the CRA has already made the disclosure required 

by section 613, which specifically covers reports of public record information for employment 

purposes.154

2. WRITTEN DISCLOSURE AND CONSENT REQUIRED

Section 604(b)(2)(A) imposes an obligation on employers. It requires that, before obtaining 

consumer reports for employment purposes, employers must disclose this fact to each affected 

consumer in writing and obtain the consumer’s written authorization.155

3. “IN A DOCUMENT THAT CONSISTS SOLELY OF THE DISCLOSURE”

A. May include brief description of the nature of consumer reports. The document that sets 

forth the disclosure to the consumer that a consumer report may be obtained for employment 

purposes may contain only minor additional items. The document may include a brief 

description of the nature of the consumer reports covered if the description does not confuse 

the consumer or detract from the mandated disclosure.156

B. May include consumer authorization. The disclosure document may include the required 

request for consumer authorization for procurement of a report for employment purposes.157

If the disclosure notice and the consumer authorization are combined, certain identifying 

information may be included in the form; however, the notice may not include extraneous or 

contradictory information, such as a request for a consumer’s waiver of his or her rights under 

the FCRA.158

C. May include investigative consumer report disclosure. If an employer intends to do an 

investigative consumer report on an employee or prospective employee, it must provide a 

disclosure under both this section and section 606.159 An employer may include, with the 

disclosure required by section 604(b)(2)(A), a very limited notice of intent to procure an 

investigative consumer report required by section 606(a). However, the employer may not 

meet its obligation under section 606(b) to describe the nature and scope of the investigation in 

the same notice, because it would likely overshadow the disclosure required by this section.160

D. May not be included in employment application. The disclosure cannot be part of a printed 

employment application.161

4. TIMING AND EFFECTIVENESS OF DISCLOSURE AND AUTHORIZATION

The required disclosure may be made, and the authorization obtained, when the consumer applies 

for or commences employment.162 An employer may use a one-time blanket disclosure, and obtain 

permission from applicants or current employees to procure consumer reports, at any time during 

the application process or during the employee’s tenure.163 The disclosure must state “clearly and 

conspicuously” that the employer intends for the disclosure and authorization to cover both the 

application for employment and, if the consumer is hired, any additional consumer reports obtained 

while the individual is an employee.164 A valid disclosure and consent remain effective throughout 

the duration of employment.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

5. REFUSAL TO CONSENT

The FCRA does not prohibit an employer from taking adverse action against an employee or 

applicant who refuses to authorize the employer to procure a consumer report. However, it does not 

specifically authorize such action.165

Section 604(b)(3) provides that, except for employment in the trucking industry, 

an employer intending to take adverse action shall, before taking such action, 

provide the consumer a copy of his or her consumer report and a summary of the 

consumer’s rights under the FCRA. The summary is to be in a form prescribed by 

the FTC under section 609(c)(3).

1. GENERAL RULE

Section 604(b)(3)(A) imposes a specific disclosure obligation on employers. Before taking any 

adverse action based on a consumer report, employers must provide the consumer with a copy 

of the report and a written summary of consumer rights under the FCRA. This requirement is 

generally known as a “pre-adverse action notice.”

2. TRUCKING INDUSTRY EXCEPTION 

In the trucking industry, the employer is not required to provide a written summary and copy of 

the consumer report before taking adverse action. Section 604(b)(3)(B-C) provides alternate preadverse action notices for consumers who have applied for jobs in the trucking industry by mail, 

phone, or computer.

3. RELATION TO OTHER SECTIONS – ADVERSE ACTION REQUIREMENTS 

This paragraph requires employers to provide to the consumer, before taking any adverse action 

based on a consumer report, a copy of the report, and a written summary of consumer rights under 

the FCRA. Section 615(a) applies more generally to any party who has taken adverse action that is 

based, in whole or in part, on a consumer report, and requires the report user to notify the consumer 

of the fact that adverse action was taken based on a consumer report. Because the notice under 

this paragraph must be provided to consumers before adverse action is taken, and a section 615(a) 

notice must be provided after adverse action is taken, the notices may not be included in the same 

document.166

An employer may provide this section 615(a) adverse action notice in a way that minimizes 

duplication with the pre-adverse action notice under this section. For example, in its adverse 

action notice, it could note that the consumer has already received a copy of his or her report and a 

summary of consumer rights under the FCRA.167

4. RELATION TO OTHER SECTIONS – SUMMARY OF CONSUMER RIGHTS

 This section requires employers to provide a written summary of consumer rights under the FCRA 

as part of a pre-adverse action disclosure. Section 609(c) requires CRAs to provide the summary to 

a consumer who requests disclosure of the information in his or her file. 

5. TIMING OF PRE-ADVERSE ACTION DISCLOSURE

There is no specific period of time an employer must wait after providing a pre-adverse action 

notice and before taking adverse action against the consumer. Some reasonable period of time must 

elapse, but the minimum length will vary depending on the particular circumstances involved.168 An 
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employer can comply with the pre-adverse action disclosure requirement by sending a copy of the 

report to the consumer (with the summary of consumer rights) as soon as it is prepared by the CRA 

or received by the employer.169

6. REQUIREMENT TO INCLUDE “A COPY OF THE REPORT”

A. Redacted report. Because the requirement that an employer provide “a copy of the report” 

is unqualified, an employer who uses an investigative consumer report may not redact 

references to investigative sources if those sources are included in the report.170 To preserve the 

confidentiality of sources, CRAs may provide employers with reports that do not specifically 

identify sources, and employers may release the reports to consumers as they have received 

them.171

B. Oral report. Where the employer possesses no written report because the information is 

provided verbally by the CRA, the employer may tell the applicant orally what is in the report 

before taking adverse action. Because the report itself is oral, an oral “copy” is the proper 

method of compliance, as it conveys the information that Congress intended the consumer to 

know prior to suffering adverse action.172

7. SOURCE OF CONSUMER RIGHTS SUMMARY

The CRA is responsible for sending the summary of consumer rights to employers. The employer 

must supply the summary to consumers before taking any adverse action based on a consumer 

report.173

8. PROVISION OF NOTICE BY THIRD PARTY

Employers may arrange to have the CRA provide pre-adverse action notices directly to consumers, 

but the employer is liable if the CRA does not provide the notices.174

9. CERTAINTY OF ADVERSE ACTION

Employers must comply with the pre-adverse action disclosure requirement even where the 

information contained in the consumer report (such as a criminal record) would automatically 

disqualify the individual from employment or lead to an adverse employment action.175

Section 604(c) governs the practice of “prescreening” in connection with credit 

and insurance solicitations. Subsection (1) allows prescreened solicitations only 

if the consumer consents or if the “transaction consists of a firm offer of credit or 

insurance” and the consumer has not opted out of receiving such solicitations. 

Subsection (2) limits the information that the CRA can provide to the business 

seeking the information for prescreening purposes. Subsection (3) prohibits the 

CRA from informing anyone other than the consumer that his or her information 

has been provided by a CRA to a business for prescreening purposes.

Section 604(d) is reserved.

Section 604(e) requires CRAs to allow consumers to opt out of prescreened offers. 

CRAs must establish and maintain a toll-free telephone number that a consumer 
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can call to opt out. Nationwide CRAs must establish a joint notification system for 

processing prescreening opt-outs.

1. RELATION TO OTHER SECTIONS

Sections 604(c) and 604(e) set forth the permissible purpose for and limitations on prescreening, 

along with the consumer’s right to “opt out” from prescreened lists. Section 607(a) requires CRAs 

to establish specified, reasonable procedures to ensure that they furnish consumer reports only 

for permissible purposes, including the prescreening purpose provided by Section 604(c). See 

comment 604(a)-2A.

Section 603(l) defines the type of offer that qualifies for “prescreening” service by a CRA. Section 

603(p) defines the “nationwide CRAs” that are required to establish a joint notification system for 

processing prescreen opt outs. Section 615(d) requires of users of prescreening services to make 

certain disclosures to consumers who receive written prescreened solicitations.

Section 604(f) prohibits any person from using or obtaining a consumer report, 

unless the person obtains the report for a permissible purpose and certifies that it 

will be used for that permissible purpose. 

Section 604(g) generally prohibits CRAs from furnishing medical information in 

consumer reports without consumer consent, unless the information being furnished 

pertains to medical debts, and the information is coded to avoid identifying the 

provider and nature of the transaction, prohibits creditors from obtaining uncoded 

medical information for credit purposes, with limited exceptions, requires parties 

who receive medical information to keep such information confidential, and directs 

the Federal financial agencies to promulgate rules permitting the transmission of 

certain medical information to creditors to determine a consumer’s eligibility for 

credit. Starting July 21, 2011, the Bureau assumes rulemaking authority under this 

section. 

1. IMPLEMENTING RULES

Pursuant to the mandate imposed by Section 604(g)(5), the Federal financial agencies promulgated 

rules relating to necessary and appropriate uses of medical information by creditors, limits on 

redisclosure, and sharing of medical information with affiliates (12 CFR Parts 41, 222, 232, 334, 

571, 717). See 70 Fed. Reg. 70664, 70675-96 (Nov. 22, 2005). The Commission will enforce 

the FCRA as to creditors under its jurisdiction, using the same principles set forth in those rules, 

including any changes that may be made by the Bureau.

2. RELATION TO OTHER SECTIONS

Section 603(d)(3) excludes medical information from the definition of “consumer report” in certain 

cases. Section 603(i) defines the term “medical information.” In regard to the exception in section 

604(g)(1) allowing reporting of “coded” medical debts, section 605(a)(6)(A) prescribes the coding 

of names, addresses and phone numbers so that neither the provider, nor the nature of the products 

or services out of which the debt arises, are identifiable in the report. Section 623(a)(9) requires 

medical information furnishers to disclose their status if they report information to CRAs. 
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Section 605 – 15 USC 1681c

Requirements Relating to Information Contained in Consumer Reports

Section 605(a) generally provides time limits beyond which CRAs cannot include 

information in consumer reports, subject to exceptions set forth in section 605(b). 

1. GENERAL 

This section sets forth time periods beyond which CRAs may not include information in consumer 

reports, except in the circumstances set out in section 605(b).176 Even if no specific adverse 

item is reported, a CRA may not furnish a consumer report referencing the existence of adverse 

information that predates the times set forth in this subsection.177 Section 605(a) does not require 

CRAs to report all adverse information within the time periods set forth, but only prohibits them 

from reporting adverse items beyond those time periods.178

2. SECTION APPLIES TO CRAS, NOT USERS 

This section applies only to reporting by CRAs and does not limit creditors or others from using 

adverse obsolete information. Similarly, this section does not bar a creditor from disclosing adverse 

obsolete information concerning its transactions or experiences with a consumer, because the 

information is not a consumer report.179

3. DATE THAT CRA ACQUIRED THE INFORMATION IRRELEVANT

The times or dates set forth in this section relate to the occurrence of events involving adverse 

information, which determine whether the item is obsolete. The date that the CRA acquired the 

adverse information is irrelevant to how long that information may be reported.180

4. PROVISION LIMITED TO “ADVERSE” INFORMATION

The seven-year reporting period applies only to “adverse” information that casts the consumer in 

a negative or unfavorable light. CRAs are not bound by that seven-year limit in reporting dates of 

employment and educational histories, because such dates are not “adverse” information.181

5. RETENTION OF INFORMATION IN FILES

CRAs may retain adverse information described in subsection (a) and furnish it in reports for 

purposes that are exempt under subsection (b), described below. For example, the CRA may retain 

obsolete information for the purpose of furnishing it to persons engaged in (1) credit transactions 

or the underwriting of life insurance involving a principal amount of $150,000 or more, or (2) the 

employment of any individual with an annual salary expected to equal $75,000 or more.182

Section 605(a)(1) prohibits CRAs from reporting “Cases under title 11 of the 

United States Code or under the Bankruptcy Act that, from the date of entry of 

the order for relief or the date of adjudication, as the case may be, antedate the 

report by more than 10 years.”

1. RELATION TO OTHER SUBSECTIONS

Section 605(a) imposes time limitations on reporting of adverse information by CRAs. The 

reporting of bankruptcies is governed by subsection (a)(1). The reporting of accounts placed 

for collection or charged to profit and loss is governed by subsection (a)(4). The reporting of 
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other delinquent accounts is governed by subsection (a)(5). Any such item, even if discharged in 

bankruptcy, may be reported separately for the applicable seven year period, while the existence of 

the bankruptcy filing may be reported for ten years.183

2. VOLUNTARY BANKRUPTCY

A voluntary bankruptcy petition may be reported for ten years from the date that it is filed (even 

though formal discharge of the debts occurs by later ruling), because the filing of the petition 

constitutes the entry of an “order for relief” under this subsection, just like a filing under the 

Bankruptcy Act (11 U.S.C. §301).184

3. DISMISSED BANKRUPTCY

A dismissed involuntary bankruptcy petition, or a withdrawn or dismissed voluntary petition, may 

be included in a consumer report for ten years from the date that the order dismissing the petition 

was entered.185 See discussion in comment 611(a)-4.

Section 605(a)(2) prohibits CRAs from reporting “Civil suits, civil judgments, and 

records of arrest that from date of entry, antedate the report by more than seven 

years or until the governing statute of limitations has expired, whichever is the 

longer period.”

1. OPERATIVE DATE

For a civil suit, the term “date of entry” means the date the suit was filed. A protracted civil suit 

may be reported for more than seven years from the date the case was filed, if the governing statute 

of limitations has not expired. For a civil judgment, the term “date of entry” means the date the 

judgment was entered.186

2. PAID JUDGMENTS

Paid judgments cannot be reported for more than seven years after the judgment was entered, 

because payment of the judgment eliminates any “governing statute of limitations” under this 

subsection that might otherwise lengthen the time period.187

Section 605(a)(3) prohibits CRAs from reporting “Paid tax liens which, from date 

of payment, antedate the report by more than seven years.”

1. INAPPLICABILITY TO UNPAID LIENS

If a valid tax or other lien remains unsatisfied, it may be reported as long as it remains filed against 

the consumer because this subsection addresses only paid tax liens.188 See comment 605(a)(5)-2.

Section 605(a)(4) prohibits CRAs from reporting “Accounts placed for collection 

or charged to profit and loss which antedate the report by more than seven years.”

1. RELATION TO OTHER SECTIONS

This section establishes the reporting period for collections and chargeoff accounts at seven years. 

Section 605(c)(1) sets forth the method for determining the date that starts the seven year period. 

Section 623(a)(5) requires a party that reports such accounts to a CRA to provide the “date of 

delinquency” that the CRA will use to calculate the seven year period. See comments 605(c)-2 and 

623(a)(5)(A)-2.
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2. “PLACED FOR COLLECTION”

The term “placed for collection” means internal collection activity by the creditor, as well as 

placement with an outside collector. Placement for collection occurs when dunning notices or 

other collection efforts are initiated. (A simple “reminder” notice does not constitute placement 

for collection.) The reporting period is not extended by assignment to another entity for further 

collection, or by a partial or full payment of the account. A consumer’s repayment agreement with 

the creditor or a collection agency may be treated as a new account that has its own seven year 

period.189

3. “CHARGED TO PROFIT AND LOSS”

The phrase “charged to profit and loss” means action taken by the creditor to write off the account. 

If an account that was charged off is later paid in part or paid in full by the consumer, the reporting 

period of seven years from the charge off is not extended by the subsequent payment.190

Section 605(a)(5) prohibits CRAs from reporting “Any other adverse item of 

information, other than convictions of crimes which antedates the report by more 

than seven years.”

1. RELATION TO OTHER SUBSECTIONS

This section applies to all adverse information that is not covered by section 605(a)(1)-(4). For 

example, a delinquent account that has neither been placed for collection, nor charged to profit and 

loss, may be reported for seven years from the date of the commencement of the delinquency.191

2. LIENS

Liens (other than paid tax liens) may be reported as long as they remain filed against the consumer 

or the consumer’s property and remain effective (under any applicable statute of limitations). See 

comment 605(a)(3)-1.192 A lien that is paid or otherwise terminated may be reported for seven years 

from the date it is paid or otherwise rendered ineffective.

3. CRIMINAL CONVICTIONS

A CRA may report information about criminal convictions without any limitation as to length of 

time that they antedate the report.193

4. CRIMINAL RECORDS OTHER THAN CONVICTIONS

The seven year reporting period for criminal record information “other than convictions of crimes” 

runs from the date of the reported event.194

5. IMPACT OF LAWS THAT REQUIRE EMPLOYERS TO SEARCH FOR CRIMINAL RECORDS OVER 

SEVEN YEARS OLD

A CRA is not permitted to report criminal records other than convictions beyond seven years, even 

where the CRA is providing information to an employer that state or federal law requires to check 

criminal records beyond seven years. However, an employer that checks public records on its own 

is not covered by the FCRA, and therefore may conduct searches without regard to the seven year 

time limit.195 See comment 603(d)(1)-6D.

Section 605(a)(6) prohibits a CRA from reporting the name or contact information 

of any medical information furnisher that has notified the CRA of its status, unless 
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(1) such information is coded so that a recipient cannot infer the specific provider 

or the nature of the services; or (2) the report is being provided to a life or health 

insurance company.

1. RELATION TO OTHER SECTIONS

This section parallels Section 604(g)(1), which allows CRAs to report information about debts 

arising from the receipt of medical services, products, or devices only where the identity of the 

furnisher is coded to avoid identifying the provider and nature of the transaction. Section 623(a)(9) 

requires medical information furnishers to disclose their status if they report information to CRAs, 

so that the CRAs may fulfill the requirements of this section. 

Section 605(b) states that the time period limitations in section 605(a) “are not 

applicable in the case of any consumer credit report to be used in connection with 

(1) a credit transaction involving, or which may reasonably be expected to involve, 

a principal amount of $150,000 or more; (2) the underwriting of life insurance 

involving, or which may reasonably be expected to involve, a face amount of 

$150,000 or more; or (3) the employment of any individual at an annual salary 

which equals, or which may reasonably be expected to equal $75,000, or more.”

1. APPLICATION TO REPORTS OTHER THAN CREDIT REPORTS

Notwithstanding the words “consumer credit report” in Section 605(b), the exemptions apply to 

any “consumer report” (e.g., a report for employment screening purposes containing only public 

record data) obtained in connection with insurance and employment transactions meeting the dollar 

limits specified in subsections (2) and (3).

2. “REASONABLY BE EXPECTED”

A CRA may provide the information described in subsection (a) about a consumer to employers or 

prospective employers, only if such employers reasonably expect to pay the consumer $75,000 or 

more per year for work to be performed.

Section 605(c) provides that the seven-year period for reporting accounts placed 

for collection, charged to profit or loss, or similar action by a creditor, “shall begin, 

with respect to any delinquent account that is placed for collection (internally 

or by referral to a third party, whichever is earlier), charged to profit and loss, 

or subjected to any similar action, upon the expiration of the 180-day period 

beginning on the date of the commencement of the delinquency which immediately 

preceded the collection activity, charge to profit and loss, or similar action.”

1. RELATION TO OTHER SECTIONS

Section 623(a)(5) requires an information furnisher that reports a collection or chargeoff or similar 

action to a CRA to provide the month and year of the commencement of the delinquency that led to 

the action. This section requires the CRA to use that date as the start of the obsolescence period.

2. BASIC RULE
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In calculating the seven-year period during which a CRA is permitted to report accounts that a 

creditor has reported as having been placed for collection or charged off, the period begins 180 

days from the date of the first missed payment of the delinquency that leads the creditor to take the 

action.196

3. EVENTS OTHER THAN “COMMENCEMENT OF THE DELINQUENCY” IRRELEVANT

The period is calculated from the date specified in this section, not subsequent events such as 

(a) the date the creditor first reported the charge-off or collection to the CRA;197 (b) the dates of 

payments made or missed during the delinquency that leads to the chargeoff or collection;198 (c) the 

date of the sale or transfer of the account from the original creditor to another creditor;199 or (d) the 

date a consumer disputes the debt.200

Section 605(d)(1) requires a CRA that provides a consumer report with 

bankruptcy information to include “an identification of the chapter of [Title 11, 

United States Code] under which such case arises if provided by the source of 

the information” and any voluntary withdrawal by the consumer before a final 

judgment “upon receipt of documentation certifying such withdrawal.”

Section 605(d)(2) requires most CRAs, in consumer reports that include a score, 

to disclose those cases in which the number of enquiries (requests for reports on 

the consumer) are a key factor that adversely affects the score.

If an account has been voluntarily closed by the consumer, section 605(e)

requires CRAs to include that fact in a report that refers to the account. If a 

consumer disputes an item, section 605(f) requires the CRA to indicate that fact in 

a consumer report that includes the disputed information. 

Section 605(g) provides 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 cardholder at the 

point of the sale or transaction.” This section specifies that it requires card number 

truncation only on “electronically printed” receipts.

1. SCOPE

This section applies only to electronic receipts provided by merchants “to the cardholder.” It does 

not apply to receipts that are generated by non-electronic means, such as those created by a device 

which makes an imprint of the card. It does not apply to receipts other than those provided to the 

cardholder, such as those retained by the merchant for its records.

Section 605(h)(1) provides that when a nationwide CRA receives a request for 

a consumer report that “includes an address for the consumer that substantially 

differs from the addresses in the file of the consumer,” the CRA shall notify the 

requester of the existence of the discrepancy when it provides the report. Section 

605(h)(2) required the Commission and Federal financial agencies to promulgate 
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“regulations providing guidance regarding reasonable policies and procedures 

that a user of a consumer report should employ when such user has received a 

notice of discrepancy.” Starting July 21, 2011, the Bureau assumes rulemaking 

authority under this section. 

1. IMPLEMENTING RULES

As directed by this section, the Commission and the Federal financial agencies issued rules to 

implement its provisions (16 CFR 681.1). See 72 Fed. Reg. 63718, 63771-72 (Nov. 9, 2007).

Section 605A – 15 USC 1681c-1

Identity Theft Prevention; Fraud Alerts and Active Duty Alerts

Section 605A imposes duties on nationwide CRAs with respect to identity theft. 

Section 605A(a) requires such CRAs to include a 90-day initial fraud alert in 

a consumer’s file when the consumer “asserts in good faith a suspicion that the 

consumer has been or is about to become a victim of fraud or related crime.”

Section 605A(b) requires nationwide CRAs to include a seven-year extended 

fraud alert when the consumer submits an “identity theft report” and to exclude the 

consumer from any “prescreening” lists for 5 years. Along with fraud alerts, the 

consumer is entitled to additional free file disclosures. Section 605A(c) requires 

that, upon request of an active duty military consumer, nationwide CRAs must 

include an “active duty alert” in the consumer’s file for a period of 12 months (or 

a longer period that may be established by the Commission (Bureau, starting July 

21, 2011), and exclude the consumer from any “prescreening” lists for 2 years.

Section 605A(d) requires nationwide CRAs to establish procedures to comply 

with subsections (a), (b), and (c), and advise consumers of their rights thereunder. 

Subsections (e) and (f) require nationwide CRAs and resellers receiving reports 

from other CRAs to include the alerts in the reports they provide. Subsection 

(g) requires CRAs that do not operate nationwide to explain to consumers, 

who suspect they have been or are about to be a fraud victim, how to contact 

nationwide CRAs and the Commission (Bureau, starting July 21, 2011) concerning 

the alerts required by Section 605A. 

Section 605A(h) imposes duties on creditors receiving consumer reports that 

include alerts. It generally restricts them from providing additional credit without 

establishing “reasonable policies and procedures” to confirm the identity of the 

person making the request.

1. RELATION TO OTHER SECTIONS

Section 603(q) defines several terms relating to identity theft and fraud alerts. 
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2. IMPLEMENTING RULES

The Commission issued regulations concerning “appropriate proof of identity” for placing 

alerts and other purposes (16 CFR 614). See 69 Fed. Reg. 63922, 63934 (Nov. 3, 2004). In that 

proceeding, the Commission confirmed 12 months as the duration of active duty alerts (16 CFR 

613), noting that an active duty military consumer could place a subsequent alert when necessary 

in the case of a longer deployment. See 69 Fed. Reg. 63922, 63930, 63934 (Nov. 3, 2004). In 

addition to the definitions in section 603(q), the terms “identity theft” and “identity theft report” 

are further defined by Commission rule (16 CFR 603.2 and 603.3). See 69 Fed Reg. 63922, 63933 

(Nov. 3, 2004).

3. SCOPE

When a consumer’s file contains an alert, a nationwide CRA must include the alert with all 

consumer reports it provides on that consumer. The action is necessary so that (1) a report user will 

know that it should not extend additional credit to the named consumer unless it has “reasonable 

policies and procedures” in place to ensure that it knows the identity of the individual seeking 

credit; and (2) a reseller will be able to provide “the alert placed in the file of a consumer” to the 

end user as required by section 605A(f).

4. CREDITOR DUTIES 

Section 605A(h) imposes restrictions and duties on creditors who receive consumer reports that 

include initial, extended, and active duty alerts, which vary depending on the type of alert. Most 

importantly, section 605A(h)(1)(B) forbids any user of a consumer report that includes a fraud 

alert or active duty alert from extending additional credit to the named consumer unless it has 

“reasonable policies and procedures” in place to identify the individual seeking credit. A policy of 

denying credit to any applicant whose consumer report includes a fraud alert or active duty alert is 

not a “reasonable” method of compliance with that provision.

5. “GOOD FAITH”

The consumer’s right under section 605A(a)(1) to an initial fraud alert in the consumer’s file is 

triggered only when the consumer asserts “in good faith” his or her status as a victim of fraud, 

identity theft, or other similar crime.

Section 605B – 15 USC 1681c-2

Block of Information Resulting From Identity Theft

Section605B(a) requires CRAs to “block” the reporting of any information that 

the consumer identifies as information that resulted from an alleged identity theft, 

within 4 business days after it receives “(1) appropriate proof of the identity 

of the consumer; (2) a copy of an identity theft report; (3) the identification of 

such information by the consumer; and (4) a statement by the consumer that the 

information is not information relating to any transaction by the consumer.”

Section605B(b) requires the CRA to promptly notify the furnisher of the 

information about the block and the identity theft report. Section605B(c) allows 

a CRA to refuse, decline, or rescind a block because of error or consumer 
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misrepresentation, or because the consumer benefitted from the blocked 

transaction. Section605B(d) limits the duties of CRAs that are resellers. 

Section605B(e) limits the duties of CRAs that are check verification services. 

Section605B(f) states that CRAs are not required to block information in consumer 

reports provided to law enforcement agencies.

1. RELATION TO OTHER SECTIONS

Section 603(q) defines several terms relating to identity theft and fraud alerts. Section 615(f) 

prohibits creditors from placing for collection, and debt collectors from selling, any account 

after being notified under section 605B that it resulted from identity theft. Section 623(a)(6) 

specifies duties for businesses that furnish information to CRAs after they are notified of blocked 

information.

2. IMPLEMENTING RULES

The Commission issued regulations concerning “appropriate proof of identity” for placing 

information blocks and other purposes (16 CFR 614). See 69 Fed. Reg. 63922, 63934 (Nov. 3, 

2004). In addition to the definitions in Section 603(q), the terms “identity theft” and “identity theft 

report” are further defined by Commission rule (16 CFR 603.2 and 603.3). See 69 Fed Reg. 63922, 

63933 (Nov. 3, 2004).

Section 606 – Disclosure of Investigative Consumer Reports 15 USC 1681d

Section 606(a) states that a person may not order an investigative consumer 

report on any consumer unless it is clearly and accurately disclosed to the 

consumer that an investigative consumer report including information as to his 

character, general reputation, personal characteristics, and mode of living (as 

applicable) may be made. The disclosure must be provided to the consumer no 

later than three days after the date on which the report was requested, and must 

inform the consumer of his or her right to request additional disclosures. Users 

of investigative consumer reports must certify to the CRA that they have made 

this disclosure to the consumer, and that they will provide required additional 

information upon the consumer’s request.

1. RELATION TO OTHER SECTIONS

Section 603(e) defines the term “investigative consumer report” to mean a consumer report, all or 

a portion of which contains information obtained through personal interviews with persons other 

than the subject, which information relates to the subject’s character, general reputation, personal 

characteristics, or mode of living.201 Section 614 imposes special restrictions on investigative 

consumer reports for employment purposes.

Section 604(b) imposes duties on persons who obtain consumer reports for employment 

purposes or take adverse actions based in whole or in part on such reports. An employer that uses 

investigative consumer reports must comply with those provisions as well as those imposed by 
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section 606. See comment 604(b)(2)-3C concerning compliance when the notice requirements of 

both sections 604(b)(2) and 606 are applicable.202

Because an “investigative consumer report” is a type of “consumer report,” providers and users 

of investigative consumer reports must comply with all FCRA provisions relating to consumer 

reports. Generally, a report that is specifically excluded from the definition of “consumer report” 

would not be an “investigative consumer report.” For example, a report that is not a “consumer 

report” because it involves suspected workplace misconduct described in section 603(y), is not an 

investigative consumer report.

2. LIMITED SCOPE

A. Consumer reporting agencies. This section applies only to report users, not CRAs. The FCRA 

does not require CRAs to inform consumers that information will be gathered or that reports 

will be furnished concerning them.203

B. Reports provided by business’s own personnel. This section applies only to investigative 

consumer reports prepared by CRAs. If an employer uses its own personnel to contact 

persons identified by a job applicant from the applicant’s previous work sites, for example, 

the employer does not have to comply with section 606 or other FCRA provisions in that case 

because such information is not an “investigative consumer report.”204

3. TIMING OF DISCLOSURE AND SUMMARY OF FCRA RIGHTS

The report user must provide the consumer with notice that an investigative consumer report “may 

be made” on the consumer any time up to three days after the report is first requested.205 At the 

same time, the user must provide the consumer with the summary of rights required by section 

606(a)(1)(B). See Notice to Users of Consumer Reports: Obligations of Users Under the FCRA (16 

CFR Part 698, Appendix H, Section IV, first bullet).

4. FORM AND DELIVERY OF NOTICE

The notice must be in writing and mailed or otherwise delivered to the consumer. The user may 

include the disclosure in an application for insurance or credit, if it is clear and not obscured by 

other language.206

5. CONTENT OF NOTICE

The notice must: (a) clearly and accurately disclose that an “investigative consumer report” may be 

made, which may include information as to the consumer’s character, general reputation, personal 

characteristics and mode of living (whichever are applicable); (b) state that an investigative 

consumer report involves personal interviews with sources such as neighbors, friends, or 

associates; and (c) include a statement informing the consumer of his or her right to request 

complete and accurate disclosure of the nature and scope of the investigation. The notice may 

include any additional, accurate information about the report, such as the types of interviews that 

will be conducted.207

Section 606(b) states: “Any person who procures or causes to be prepared an 

investigative consumer report on any consumer shall, upon written request made 

by the consumer within a reasonable period of time after receipt by him of the 

disclosure required by subsection (a)(1), make a complete and accurate disclosure 

of the nature and scope of the investigation requested. This disclosure shall be 
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made in a writing mailed, or otherwise delivered, to the consumer not later than 

five days after the date on which the request for such disclosure was received from 

the consumer or such report was first requested, whichever is the later.”

1. CONTENT OF DISCLOSURE OF REPORT 

When the consumer requests disclosure of the “nature and scope” of the investigation, such 

disclosure must include a complete and accurate description of the types of questions asked, the 

types of persons interviewed, and the name and address of the investigating agency. For example, 

a report user that provides the consumer with a blank copy of the form used to transmit the report 

from the agency to the user complies with the requirement that it disclose the “nature and scope” of 

the investigation. This section does not require the report user to disclose the names of sources of 

information, or to provide the consumer with a copy of the report.208 Employers may combine the 

disclosures required by section 606(b) relating to the “nature and scope of the investigation” with 

the initial disclosure that an investigative consumer report may be obtained, required by section 

606(a), but only in those cases where the employer is able to describe with sufficient specificity the 

nature and scope of any such investigation that might be requested in the future.209

Section 606(c) limits a person’s liability for a violation of subsection (a) or (b) 

upon a showing that the person maintained reasonable procedures to assure 

compliance. 

Section 606(d) provides that a CRA shall not (1) furnish an investigative 

consumer report unless it has received a certification that the required disclosures 

to consumers have been made; (2) violate any equal employment opportunity 

laws; (3) include certain public record information, unless the CRA has verified 

the accuracy of the information, obtained consumer consent, or maintains strict 

procedures to assure the accuracy of any such information (as provided in 

section 613); or (4) include adverse information obtained through a personal 

interview unless the CRA has followed reasonable procedures to corroborate 

that the information or the person interviewed is the best possible source of the 

information.

Section 607 – Compliance Procedures 15 USC 1681e

Section 607(a) states: “Every consumer reporting agency shall maintain 

reasonable procedures designed to avoid violations of section 605 and to limit 

the furnishing of consumer reports to the permissible purposes listed under section 

604. These procedures shall require that prospective users of the information 

identify themselves, certify the purposes for which the information is sought, and 

certify that the information will be used for no other purpose. Every consumer 

reporting agency shall make a reasonable effort to verify the identity of a new 

prospective user and the uses certified by such prospective user prior to furnishing 
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such user a consumer report. No consumer reporting agency may furnish a 

consumer report to any person if it has reasonable grounds for believing that the 

consumer report will not be used for a purpose listed in section 604.”

1. RELATION TO OTHER SECTIONS

This section imposes an obligation on CRAs to follow reasonable procedures to (1) limit the 

furnishing of reports to those with permissible purposes under section 604, and (2) comply with 

duties imposed by section 605 related to information contained in consumer reports, such as the 

responsibility to avoid reporting obsolete information. 

2. PROCEDURES TO AVOID REPORTING OBSOLETE INFORMATION

A. General. A CRA must establish procedures with its sources of adverse information that will 

avoid the risk of reporting obsolete information. For example, the CRA must require a creditor 

or debt collector to supply the date an account was placed for collection or charged off, as 

required by section 623(a)(5).210

B. Retention of obsolete information for reporting in excepted circumstances. If a CRA retains 

adverse information in its files that is “obsolete” under section 605(a) (i.e., information about 

a satisfied judgment that is more than seven years old), so that it may be reported for use in 

transactions described by section 605(b) (applications for credit or life insurance for $150,000 

or more, or employment at an annual salary of $75,000 or more), it must have procedural 

safeguards to avoid reporting the information except in those situations. The safeguards should 

ensure that the CRA releases obsolete information only to the extent permitted by section 

605(b).211

3. PROCEDURES TO LIMIT DISCLOSURE SOLELY TO USERS WITH PERMISSIBLE PURPOSE

A CRA must have reasonable procedures in place to ensure that it furnishes consumer reports 

only to those with a “permissible purpose” and to verify that users of the information have 

identified themselves, certified the purpose for which the information is obtained, and certified 

that the information will be used for no other purpose. What constitutes adequate verification will 

vary with the circumstances. Appropriate procedures might require an on-site visit to the user’s 

place of business, a check of the user’s references, confirmation of the business identity of the 

applicant (e.g., via phone directories or publicly available data such as governmental licensing 

information), and examining applications and supporting documentation supplied by applicants, or 

other reasonable methods, to detect suspect representations, discrepancies, illogical information, 

suspicious patterns, factual anomalies, and other indicia of unreliability.212

4. REQUIREMENT THAT USERS CERTIFY A PERMISSIBLE PURPOSE

A. General. A CRA must adopt procedures that require prospective report users to identify 

themselves, certify the purpose for which the information is sought, and certify that the 

information will be used for no other purpose. A CRA must determine initially that users have 

permissible purposes and ascertain what those purposes are. It should obtain a specific, written 

certification that the recipient will obtain reports for those particular purposes and no others. 

The user’s certification that the report will be used for no other purposes should expressly 

prohibit the user from sharing the report or providing it to anyone else, other than the subject 

of the report or to another party having the same purpose in the same transaction.213
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B. Blanket or individual certification. Once the CRA obtains a certification from a user (e.g., a 

creditor) that typically has a permissible purpose for receiving a consumer report, stating that 

the user will use consumer reports only for permissible purposes, it need not require the user to 

certify its purpose for each individual report obtained unless there is reason to believe the user 

may be violating its certification. If the user could have both permissible and impermissible 

purposes for ordering consumer reports (e.g., an attorney or a private investigator), the CRA 

must require the user to provide a separate certification each time it requests a consumer 

report.214

C. Certification listing multiple permissible purposes. A CRA may accept a blanket certification 

that lists multiple permissible purposes. However, the certification must be limited to the 

consumer report user’s actual purposes for ordering consumer reports. The certification may 

not, for example, state all purposes that are permissible under the statute unless that person 

actually intends to use consumer reports for all of those purposes.

D. Procedures to avoid recipients’ abuse of certification. When doubt arises concerning any 

user’s compliance with its contractual certification that it will use reports only for permissible 

purposes, a CRA must take additional steps to ensure compliance as appropriate, such as 

requiring a separate, advance certification for each report it furnishes that user, or auditing 

that user to verify that it is obtaining reports only for permissible purposes. A CRA must 

cease furnishing consumer reports to users who request consumer reports for impermissible 

purposes.215

5. APPLICATION TO MULTIPLE CRAS INVOLVED IN RESALES

When a CRA supplies consumer reports to another CRA and relies on that other CRA to identify 

and verify the end users of consumer reports, the supplying CRA must have reasonable procedures 

to ensure that the receiving CRA is identifying and verifying the end users in accord with this 

section. Further, the supplying CRA must obtain sufficient information from the receiving CRA 

regarding the identity of the end user so that the supplying CRA can investigate whenever it 

has reason to question the identity of an end user of a consumer report, thus allowing CRAs to 

promptly and effectively limit or cut off access to users who should not receive consumer reports.

6. PROCEDURES TO LIMIT ACCESS TO AND MONITOR DATABASE

A CRA must have reasonable and effective procedures to limit unauthorized access to its 

databases. Such procedures may include a system of monitoring access to its database of consumer 

reports, including a system to monitor anomalies and other suspicious activity to guard against 

unauthorized access to the database and against users obtaining consumer reports without a 

permissible purpose. Procedures also may include sufficient restrictions on user accounts (i.e., 

Internet Protocol address and time-of-day restrictions), installation and use of appropriate computer 

hardware and software, and sufficient screening of employees who will have access to the database 

and consumer reports. If it appears that a person has obtained unauthorized access to a CRA’s 

computerized files, the CRA must take appropriate steps including altering the means of access, 

such as changing codes and passwords, and making random checks to verify that reports are 

obtained only for permissible purposes.216

7. REPORTS ON CREDITOR’S OWN CUSTOMERS 

If a CRA provides consumer reports to a credit grantor on all its open-end account customers, 

it must make certain that the credit grantor always notifies the CRA when accounts are paid off 
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and closed or terminated, to avoid furnishing reports on former customers or other customers 

for whom the credit grantor lacks a permissible purpose. (See also discussion in comment 

604(a)(3)(A)-4C).217

8. CONSUMER AUTHORIZATION

A CRA providing reports pursuant to written consumer consent, as permitted by section 604(a)(2), 

must maintain reasonable procedures to assure that the authorizations are genuine.218

Section 607(b) states: “Whenever a consumer reporting agency prepares a 

consumer report it shall follow reasonable procedures to assure maximum possible 

accuracy of the information concerning the individual about whom the report 

relates.”

1. RELATION TO OTHER SECTIONS

Section 623 imposes accuracy duties on creditors, debt collectors, and other furnishers of 

information to CRAs. It does not expand or reduce CRAs’ duties under this section.219

2. GENERAL

A CRA must accurately transcribe, store and communicate consumer information received from a 

source that it reasonably believes to be reputable, in a manner that is logical on its face. If a CRA 

reports an item of information that turns out to be inaccurate, it does not violate this section if it has 

established and followed reasonable procedures in reporting the item. However, when a CRA learns 

or should reasonably be aware of errors in its reports that may indicate systematic problems (by 

virtue of information from consumers, report users, from periodic review of its reporting system, 

or otherwise), it must review its procedures for assuring accuracy and take any necessary steps to 

avoid future problems. Similarly, it should establish procedures to avoid reporting information from 

its furnishers that appears implausible or inconsistent.220

A consumer report need not be tailored to the user’s needs, and may contain any information that is 

complete, accurate, and not obsolete on the consumer who is the subject of the report. A consumer 

report may include a list of recipients of reports on the consumer, subject to the prohibition in 

section 604(c)(3) against disclosing prescreening inquiries to parties other than the consumer.221

3. REQUIRED STEPS TO IMPROVE ACCURACY

If the CRA’s review of its procedures reveals, or the CRA should reasonably be aware of, steps it 

can take to improve the accuracy of its reports at a reasonable cost, it must take any such steps. 

It should correct inaccuracies that come to its attention. A CRA must also adopt reasonable 

procedures to eliminate systematic errors that it knows about, or should reasonably be aware of, 

resulting from procedures followed by its sources of information. For example, if a particular credit 

grantor has often furnished erroneous consumer account information, the CRA must require the 

creditor to revise its procedures to correct whatever problems cause the errors or stop reporting 

information from that creditor.

4. COMPLETENESS

A. Completeness of report. CRAs are not required to include all existing derogatory or favorable 

information about a consumer in their reports. (See, however, discussion in comment 611(c)-

2, concerning inclusion of consumer dispute statements.) However, a CRA may not mislead 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

its subscribers as to the completeness of its reports by deleting favorable information and not 

disclosing its policy of making such deletions.222

B. Completeness of item of information. A CRA must report significant, verified information 

it possesses about a credit account or other item of information included in the consumer’s 

credit file. For instance, a CRA may report delinquent accounts in consumer reports, but must 

accurately note later payments or other significant activity on the account.223

5. REPORTING OF CREDIT OBLIGATIONS 

A. Past due accounts. A CRA that employs reasonable procedures to keep its files current on past 

due accounts (for example, by requiring its creditors to notify the CRA when a previously 

past due account has been paid or discharged in bankruptcy) complies with this section.224 A 

CRA that refuses to accept updated and corrected information from a party providing data 

on loan accounts, and still maintains that information in its database, does not have in place 

“reasonable procedures to assure maximum possible accuracy of information” to comply with 

section 607(b) with respect to such accounts.225

B. Joint obligations. Any report of a joint obligation must accurately report the relation of the 

consumer to the obligation. A personal guarantee of a debt incurred by another (including a 

corporation) may be included in a consumer report on the individual who is the guarantor, if 

the report accurately reflects the nature of the individual’s involvement.226

6. REPORTING OF BANKRUPTCIES

A consumer report may include an account that was discharged in bankruptcy (as well as the 

bankruptcy itself), as long as it reports a zero balance to reflect the fact that the consumer is no 

longer liable for the discharged debt. Similarly, if a reported bankruptcy has been dismissed, the 

CRA should report that fact.227 It is not a reasonable procedure to label an account that has been 

discharged in bankruptcy as “charged off as bad debt” if the account was open and not charged off 

when the consumer filed bankruptcy. Such a designation would be inaccurate or misleading, as it 

would indicate that the creditor had written off the account at the time of bankruptcy when it had 

not in fact done so.228 However, a creditor or CRA is not prohibited from reporting that an account 

has been charged off when it in fact was charged off.229

7. PROTECTION AGAINST ALTERATION

CRAs must adopt reasonable security procedures to minimize the possibility that computerized 

consumer information can be altered by either authorized or unauthorized users of the information 

system.230

8. LOGICAL ERRORS

A CRA must maintain procedures to avoid reporting information with obvious logical 

inconsistencies, such as a credit account opened when the consumer was known to be a minor.

Section 607(c) states: “A consumer reporting agency may not prohibit a user of 

a consumer report furnished by the agency on a consumer from disclosing the 

contents of the report to the consumer, if adverse action against the consumer has 

been taken by the user based in whole or in part on the report.”
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Section 607(d) requires CRAs to “provide to any person (A) who regularly and 

in the ordinary course of business furnishes information ... with respect to any 

consumer; or (B) to whom a consumer report is provided by the agency, a notice 

of such person’s responsibilities” under the FCRA that is substantially similar to 

the content prescribed by the Commission. (Starting July 21, 2011, the Bureau 

assumes the authority to prescribe the content of the notice.)

1. PRESCRIBED NOTICES

The Commission prescribed notices to describe FCRA responsibilities of (a) furnishers of 

information to CRAs and (b) users of consumer reports (16 CFR Part 698, App. G&H). See 69 Fed. 

Reg. 69776, 69790, 69795 (Nov. 30, 2004).

2. ELECTRONIC DELIVERY OF NOTICES

If the CRA delivers a notice electronically, it must be clear and prominent. Each notice must be 

presented so that it is unavoidable, of a size and shade and on the screen for a sufficient time that an 

ordinary consumer can read and understand it, and easily printable.231

Section 607(e)(1) states, “A person may not procure a consumer report for 

purposes of reselling the report (or any information in the report) unless the person 

discloses to the consumer reporting agency that originally furnishes the report (A) 

the identity of the end-user of the report (or information); and (B) each permissible 

purpose under section 604 [§ 1681b] for which the report is furnished to the 

end-user of the report (or information).” Section 607(e)(2) requires persons who 

procure consumer reports for others to establish and comply with reasonable 

procedures designed to ensure that the information is resold only for a purpose for 

which the report may be furnished under section 604. Section 607(e)(3) states 

that disclosure of a federal agency as an “end-user” is not required where the 

agency properly certifies that the nondisclosure is necessary to protect classified 

information or safety of agency employees or contractors.

1. RELATION TO OTHER SECTIONS

The term “reseller” is defined in section 603(u). As noted in comment 603(u)-1, in some cases a 

CRA that is a “reseller” is subject to additional duties from other CRAs.

2. GENERAL

When a CRA obtains a credit report from another CRA, it is procuring a consumer report for the 

purpose of reselling the report, and is thus subject to the section 607(e) requirements that apply to 

resellers, including the requirement to identify the end-user to the CRA from which it procures the 

report.232
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

Section 608 – Disclosures to Governmental Agencies 15 USC 1681f

Section 608 allows CRAs to furnish identifying information on consumers to 

governmental agencies, limited to their “name, address, former addresses, places 

of employment, or former places of employment.”

1. GENERAL

A CRA may furnish specified identifying information concerning a consumer to a governmental 

agency, even if that agency does not have a “permissible purpose” under the FCRA to receive a 

consumer report. A governmental agency may obtain information beyond what is authorized by this 

section only if it has a permissible purpose under section 604, if such disclosure is required by state 

law under section 625, if the disclosure is made to the FBI under section 626, or if the disclosure is 

made for counterterrorism purposes under section 627.233

2. GOVERNMENTAL AGENCIES

The term “governmental agency” includes federal, state, county and municipal agencies, and grand 

juries.234

Section 609 – Disclosures to Consumers 15 USC 1681g

Section 609(a) requires CRAs, upon request, to disclose to the consumer (1) 

“all information in the consumer’s file at the time of the request” (but not credit 

scores or other risk predictors), except that the CRA must truncate the consumer’s 

Social Security number if requested; (2) “sources of the information; except that 

the sources of information acquired solely for use in preparing an investigative 

consumer report and actually used for no other purpose need not be disclosed;”

(3) except for some cases involving federal agencies and classified information, 

identification of each person that procured a consumer report during the previous 

year (two years, in the case of reports made for employment purposes); (4) “the 

dates, original payees, and amounts of any checks upon which is based any 

adverse characterization of the consumer, included in the file at the time of the 

disclosure;” (5) “a record of all inquiries received by the agency during the 1-year 

period preceding the request that identified the consumer in connection with a 

credit or insurance transaction that was not initiated by the consumer;” and (6) “if 

the consumer requests the credit file and not the credit score, a statement that the 

consumer may request and obtain a credit score.” Section 609(b) exempts certain 

information received prior to the enactment of the FCRA.

1. RELATION TO OTHER SECTIONS AND RULES

This section specifies the information that CRAs must disclose to consumers with proper 

identification, upon request. Section 610 sets forth the conditions under which these disclosures 

must be made, and the form in which they must be made. Section 612 sets forth the circumstances 
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under which CRAs may charge (and the maximum amount allowed) for making such disclosures. 

The term “file” as used in section 609(a)(1) is defined in section 603(g). The term “investigative 

consumer report,” which is used in section 609(a)(2), is defined in section 603(e).235 The 

Commission issued regulations concerning “appropriate proof of identity” for obtaining file 

disclosures and other purposes (16 CFR 614). See 69 Fed. Reg. 63922, 63934 (Nov. 3, 2004).

2. POWER OF ATTORNEY

A CRA may disclose a consumer’s file to a third party authorized by the consumer’s written power 

of attorney to obtain the disclosure, if the third party presents adequate identification and fulfills 

other applicable conditions of disclosure (e.g., pays a fee, if required).236

3. “ALL INFORMATION IN THE CONSUMER’S FILE”

A. General. A CRA must disclose all items in the consumer’s file, no matter how or where they 

are stored. A CRA is required to make the consumer disclosure regardless of whether it 

designates its records as “files” or “archives” or uses any other terminology for the information 

it retains on a consumer.237 A CRA that resells consumer report information from other CRAs 

may have no information to disclose if it has no retained file of the data at the time it receives a 

consumer’s disclosure request;238 however, it still must disclose recipients of consumer reports 

as provided in this section.

B. Ancillary records. Ancillary records such as a CRA’s audit trail of changes it makes in the 

consumer’s file, billing records, or the contents of a consumer relations folder, are not included 

in the term “information in the consumer’s file” that must be disclosed to the consumer 

pursuant to this section.239

4. DISCLOSURE OF “SOURCES” OF INFORMATION

CRAs must disclose the sources of information in the consumer’s file, except for sources of 

information acquired solely for use in preparing an investigative consumer report.240

5. DISCLOSURE OF USERS “THAT PROCURED A CONSUMER REPORT”

A. General. CRAs must maintain records of recipients of consumer reports sufficient to permit 

compliance with the requirement that they disclose the identity of recipients of consumer 

reports for one year prior to the request for file disclosure (two years for employment 

purposes).241

B. Recipients of prescreened lists. A CRA must furnish to a consumer requesting a file disclosure 

the identity of recipients of any prescreened lists that contained the consumer’s name within 

the previous year.242

C. Recipient of erroneous report. Even if a CRA furnishes a consumer report in error, it must 

retain that information on file so that it can comply with its obligation to identify all persons 

that procured a consumer report on an individual, upon the consumer’s request for a file 

disclosure.243 The provision of section 605B that allows an identity theft victim to block 

information resulting from identity theft would allow the consumer to suppress information on 

recipients that received reports as a result of identity theft.

D. Resales. A CRA that provides information to an intermediary that will resell the information to 

a third party must disclose the name of the third party (the “end-user”) to the consumer as part 

of its file disclosure.244 Similarly, a CRA that furnishes a consumer report directly to a report 

user at the request of another CRA must disclose the name of the user that was the ultimate 
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recipient of the report, not the name of the other agency that made the request.245 See section 

607(e), concerning the duty of persons who procure consumer reports for resale to identify the 

“end-user” to the originating CRA.

Section 609(c) directed the Commission to “prepare a model summary of the 

rights of consumers” under the FCRA, which CRAs must include in all written 

file disclosures to consumers. Starting July 21, 2011, the Bureau assumes 

responsibility for the summary. Nationwide CRAs also must include “a toll-free 

telephone number established by the agency, at which personnel are accessible to 

consumers during normal business hours.”

1. PRESCRIBED SUMMARY

The Commission published the model Summary of FCRA Rights, as required by this provision 

(16 CFR Part 698, App. F). CRAs are required to include that Summary, or a substantially 

similar document, to consumers with each written file disclosure. 69 Fed. Reg. 69776, 69787 

(Nov. 30, 2004).

2. TOLL FREE NUMBER “AT WHICH PERSONNEL ARE ACCESSIBLE TO CONSUMERS DURING 

NORMAL BUSINESS HOURS”

Nationwide CRAs must provide with each written file disclosure a toll-free number at which 

personnel are available during normal business hours – Monday through Friday, 9 am to 5 pm in 

the time zone in which the call originates. A CRA that prevents these consumers from reaching 

personnel, whether by blocking calls (e.g., busy signals) or placing the consumer on hold for an 

unreasonable amount of time, violates this provision. The CRAs should maintain sufficient service 

levels that are consistent with levels maintained by comparable call centers for the anticipated 

demand.246 See comments 603(p)-2&3, concerning the CRAs that are and are not subject to 

this requirement.247

Section 609(d) directed the Commission to prepare a model summary of identity 

theft victim rights under the FCRA. Starting July 21, 2011, the Bureau assumes 

responsibility for the summary. When consumers contact CRAs stating that they are 

victims of fraud or identity theft, the section requires CRAs to provide consumers 

with information in that summary. 

1. PRESCRIBED SUMMARY

The Commission published the model Summary of Consumer Identity Theft Rights, as required 

by this provision (16 CFR Part 698, App. E). CRAs are required to provide that Summary, or a 

substantially similar document, to consumers who are identity theft victims. See 69 Fed. Reg. 

69776, 69784 (Nov. 30, 2004).

Section 609(e) provides a mechanism through which identity theft victims and 

law enforcers can obtain applications and other records from businesses for 

transactions made by the alleged identity thief.
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1. RELATION TO OTHER SECTIONS

Section 615(g)(2) provides that debt collectors must furnish certain information to identity theft 

victims.

2. SCOPE

This section affords relief only to individuals, because “victim” in this context is a “consumer” 

whose information has been used without authorization for criminal purposes.

3. IRRELEVANCE OF VICTIM LIABILITY 

Even if the business states that it will not attempt to collect debts from the consumer in whose 

name an identity thief has purchased goods or services, it must supply the information required by 

this section to an identity theft victim.

Section 609(f) specifies the content, manner, and time frame for CRA disclosure 

of credit scores to consumers. It also provides, among other things, that (1) no 

score disclosure is required of a CRA that does not develop or distribute scores 

in connection with mortgage loans; (2) CRAs need not explain unmodified scores 

created entirely by a third party, but need only provide identifying and contact 

information on the score creator; (3) CRAs need not maintain scores in their 

files; and (4) CRAs “may charge a fair and reasonable fee, as determined by 

the Commission” for providing a credit score. Starting July 21, 2011, the Bureau 

assumes the authority to determine the reasonable fee. 

1. RELATION TO OTHER SECTIONS

Section 609(a)(6) requires CRAs to include a statement that the consumer may request and obtain a 

credit score when they make a file disclosure that does not include a score.

2. SALE OF OTHER PRODUCTS WITH CREDIT SCORE

A CRA cannot condition the sale of a credit score on the purchase of other products.

3. “REASONABLE FEE” DETERMINATION

The Commission did not determine a specific dollar amount that constitutes a “fair and reasonable 

fee” under this section. Rather, it stated that a CRA may charge an amount that does not 

significantly exceed the current market rate for credit scores. See 69 FR 64698, 64701 (Nov. 8, 

2004). Unless and until the Bureau publishes such a determination, the Commission staff will look 

to the market in credit scores to determine whether a fee is “fair and reasonable” under this section. 

Section 609(g) generally requires any person who “makes or arranges loans and 

who uses a consumer credit score ... in connection with an application initiated or 

sought by a consumer for a ... loan for a consumer purpose that is secured by 1 to 

4 units of residential property” to provide consumers with their credit score, along 

with a required disclosure. 
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

1. APPLIES TO SECOND MORTGAGES

This section requires disclosure of a credit score for all transactions secured by residential real 

property. It is not limited to the initial sale of property or its refinancing; it applies equally to an 

application for a second mortgage or equity line of credit.

2. APPLIES TO A “PERSON WHO MAKES OR ARRANGES LOANS”

The disclosure duty applies to brokers, because this section specifies that it applies to any party that 

“arranges” mortgage loans covered by this provision.

3. DISCLOSURE OF SCORES

A. Pre-application consultation. This section requires a score disclosure by any person who “uses 

(a score) in connection with an application initiated or sought by the consumer” for a real 

estate secured loan. When a consumer consults a broker or lender about the options available, 

and that broker or lender procures and uses a score as part of that process, a disclosure is 

required even if the consultation does not include a formal or informal application.

B. Duplicate disclosures. The consumer is entitled to only one score disclosure per transaction, 

even in a circumstance involving an extended application process. For example, if a broker has 

provided a disclosure at the start of the process, no lender or prospective lender needs to make 

a duplicate disclosure.

4. DISCLOSURE MAY BE COMBINED WITH RISK-BASED PRICING NOTICE

A person required to provide a credit score and notice under this section, and a risk-based pricing 

notice under section 615(h) and its implementing rule, may do so in a single document by utilizing 

the model credit score exception notice for loans involving real property under the risk-based 

pricing rule. See 16 CFR 640.5(d), 16 CFR Part 698 (Form B-3). 

Section 610 – 15 USC 1681h

Conditions and Form of File Disclosure to Consumer

Sections 610(a) and (b) state that CRAs must require that the consumer furnish 

“proper identification” before sharing the information in the consumer’s file with 

him or her. The disclosure is required to be provided in writing, except that the 

consumer may specify that it be made “(A) in person, upon the appearance of 

the consumer at the place of business of the consumer reporting agency where 

disclosures are regularly provided, during normal business hours, and on 

reasonable notice; (B) by telephone, if the consumer has made a written request 

for disclosure by telephone; (C) by electronic means, if available from the agency; 

or (D) by any other reasonable means that is available from the agency,” in which 

case the CRA “may make the disclosures” in such other form.

Sections 610(c) and (d) require CRAs to provide trained personnel to explain to 

the consumer any information furnished in the required disclosure, and allow the 
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consumer to be accompanied by one other person of his choosing to an in-person 

disclosure. 

1. IMPLEMENTING RULES

The Commission issued regulations concerning “appropriate proof of identity” for file disclosure 

and other purposes (16 CFR 614). See 69 Fed. Reg. 63922, 63934 (Nov. 3, 2004).

2. EXTRA CONDITIONS PROHIBITED

A CRA may not add conditions not set out in the FCRA and related rules as a prerequisite to the 

required disclosure.248

3. DISCLOSURE IN THE PRESENCE OF THIRD PARTIES

When the consumer requests disclosure in a third party’s presence at an in-person disclosure, 

the CRA may require that a consumer sign an authorization before such disclosure is made. The 

consumer may choose the third party to accompany him or her when receiving the disclosure.249

4. METHOD OF DISCLOSURE

Disclosure should usually be provided in writing. However, where the consumer specifies a 

preference for an in-person, electronic, phone, or other reasonable means of disclosure available 

from the CRA, the CRA may make the disclosure in that fashion.

Section 610(e) prohibits certain non-FCRA (defamation, invasion of privacy, or 

negligence) civil suits against CRAs, users, and furnishers.

Section 611 – 15 USC 1681i

Procedure in Case of Disputed Accuracy

Section 611(a) provides that “if the completeness or accuracy of any item of 

information contained in a consumer’s file at a consumer reporting agency is 

disputed by the consumer and the consumer notifies the agency directly, or 

indirectly through a reseller, of such dispute, the agency shall, free of charge, 

conduct a reasonable reinvestigation to determine whether the disputed 

information is inaccurate and record the current status of the disputed information, 

or delete the item from the file ..., before the end of the 30-day period beginning 

on the date on which the agency receives the notice of the dispute from the 

consumer or reseller.” The CRA may refuse to investigate “frivolous or irrelevant”

disputes. The CRA must provide notice of the dispute to any person who furnished 

information in dispute, which shall include “all relevant information regarding the 

dispute.” If a disputed item is found to be inaccurate or incomplete or cannot be 

verified, the CRA must delete or modify the information and notify the furnisher. 

Upon conclusion of the investigation, the CRA must notify the consumer of the 

results of the investigation in accord with the procedure set forth in this section.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

A CRA must establish procedures to ensure that information that has been disputed 

by the consumer under this section and deleted by the CRA does not reappear in 

the file. A previously deleted item may be reinserted into the consumer’s file only 

if (1) the furnisher of the information certifies that it is accurate and complete, and 

(2) the CRA notifies the consumer of the reinsertion within five days.

1. RELATION TO OTHER SECTIONS

This section sets forth procedures CRAs must follow if a consumer disputes the completeness 

or accuracy of any item of information in the consumer’s file. Section 605B, which deals with 

information resulting from identity theft, allows consumers to block, rather than dispute, such 

information in their files. Section 623(b) describes the duties of furnishers when CRAs ask them to 

verify information that a consumer has disputed.250

2. REASONABLE INVESTIGATION

A CRA responding to a dispute must make a good faith effort to determine the accuracy of the 

disputed item or items. In some cases, evidence submitted by the consumer (e.g., a clear copy of 

a dated cancelled check paying off an account showing an outstanding balance), standing alone, 

will make it clear that an item is inaccurate or incomplete. In other cases, the CRA must conduct a 

“reasonable” investigation that, at a minimum, would include checking with the original sources or 

other reliable sources of the disputed information and inform them of all relevant information and 

evidence submitted by the consumer as part of his or her dispute, state the consumer’s position, and 

then ask whether the source would confirm the information, qualify it, or accept the consumer’s 

explanation. In investigating and attempting to verify a disputed credit transaction, a CRA need 

not require the creditor to produce documentation such as the actual signed sales slips. However, 

depending on the nature of the dispute, investigation and verification may require more than asking 

the original source of the disputed information the same question and receiving the same answer.251

3. “COMPLETENESS” OF ITEMS IN FILE 

A. General. The consumer may dispute the “completeness ... of any item of information” in his 

file (e.g., that a charged off item was subsequently paid). If a consumer disputes a debt, the 

CRA must investigate its validity and/or status by ascertaining whether the debt was owed by 

the consumer or whether the debt had subsequently been paid. For example, if a consumer 

alleges that she has satisfied a judgment reflected in the report as unpaid or that she has paid a 

debt reflected in the report as unpaid, the CRA must investigate the matter. If a file reflects a 

debt discharged in bankruptcy without reflecting subsequent reaffirmation and payment of that 

debt, a consumer may require that the item be investigated.252

B. No right to add new accounts to file. A CRA is not required to create new files on consumers 

for whom it has no file, nor is it required to add information about accounts not reflected in an 

existing file, because consumers may dispute only the completeness or accuracy of particular 

items of information in the file. A CRA may charge fees for creating or adding items to files on 

consumers at their request, or for other services not required by the FCRA that are requested 

by consumers.253

C. No right to add explanation of extenuating circumstances. A CRA has no duty to investigate, 

or take any other action under this section, if a consumer merely provides an explanation for 

failing to pay a debt such as sudden illness or layoff, and does not challenge the accuracy 
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or completeness of the item of information in the file relating to a debt. Although a CRA is 

not required to accept a consumer dispute statement that does not challenge the accuracy or 

completeness of an item in the consumer’s file, it may accept such a statement and include it in 

the file.254

4. CRA DUTY TO “RECORD THE CURRENT STATUS OF THE DISPUTED INFORMATION”

The CRA must, upon investigation, “record the current status” of the disputed item. This requires 

inclusion of any information relating to a change in status of an ongoing matter. For example, 

it must include in the report that a credit account had been closed, that a debt shown as past due 

had subsequently been paid or discharged in bankruptcy, or that a debt shown as discharged in 

bankruptcy was later reaffirmed and/or paid.255 If an involuntary petition for bankruptcy is being 

reported without identifying it as involuntary or without disclosing that it has been dismissed, the 

consumer may dispute the item as incomplete and require the CRA to update the file to reflect its 

complete and accurate current status.256

5. DISPUTE THAT REPORT USER LACKED PERMISSIBLE PURPOSE

When a CRA receives a dispute from a consumer alleging that an inquiry that appears in his/her 

file was not made by a person who had a permissible purpose for obtaining the consumer report, 

and those allegations are supported by the CRA investigation, the CRA has two options. It may 

either delete the inquiry as inaccurate, or amend the file to make the item “complete” by reflecting 

clearly that the inquiry was generated by a party who did not have a permissible purpose to obtain a 

consumer report on the consumer.

6. INVESTIGATION OF “FRIVOLOUS OR IRRELEVANT” DISPUTES NOT REQUIRED

The mere presence of contradictory information in the file does not provide the CRA reasonable 

grounds to believe that the dispute by the consumer is “frivolous or irrelevant.” A CRA must 

assume a consumer’s dispute is bona fide, unless there is evidence to the contrary. Such evidence 

may constitute receipt of letters from consumers disputing all information in their files without 

providing any allegations concerning the specific items in the files, or of several letters in similar 

format that indicate that a particular third party (e.g., a “credit repair” operator) is counseling 

consumers to dispute all items in their files, regardless of whether the information is known to be 

accurate. The CRA is not required to repeat an investigation that it has previously conducted simply 

because the consumer reiterates a dispute about the same item of information, unless the consumer 

provides further information indicating that the item is inaccurate or incomplete, or alleges changed 

factual circumstances.257

7. NO PREREQUISITES TO DUTY TO INVESTIGATE

A CRA’s obligation to investigate disputed items is not contingent upon the consumer’s obtaining 

a file disclosure from the CRA, suffering denial of a benefit, or asserting any rights under other 

provisions of the FCRA.258

8. REQUIREMENT THAT CRA COMMUNICATE “ALL RELEVANT INFORMATION”

A CRA must communicate the dispute to the furnisher in a fashion that enables the furnisher to 

fully investigate and properly respond to the dispute. It may do so electronically in those cases 

where it can provide “all relevant information” submitted by the consumer so that the furnisher 

is fully informed of the basis for the dispute and can research relevant sources (e.g., original 

application or payment ledgers). In some cases, a CRA may provide all relevant information 
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received from the consumer in the notice of the dispute to the furnisher by (a) placing a description 

of the relevant information in the narrative field (e.g., “12/15/01 ltr from S. Jones at Sears states 

never late” or “point-of-contact D. Smith at 203-555-1212”); and (b) employing a code that 

adequately and fully describes the nature of the evidence received from the consumer. A CRA 

does not comply with this provision if it merely indicates the nature of the dispute, without 

communicating to the furnisher the specific relevant information received from the consumer. For 

example, if the consumer claimed “never late” and submitted documentation (such as cancelled 

checks) to support his/her dispute, a CRA does not comply with the requirement that is provide 

“all relevant information” if it simply notifies the furnisher that the consumer disputes the payment 

history without communicating the evidence received. The CRA may comply in all cases by 

forwarding all communications and documents provided by the consumer.

9. DISPUTE MUST BE CONVEYED TO A CRA “DIRECTLY” BY THE CONSUMER

A CRA need not investigate a dispute about a consumer’s file raised by a third party – such as a 

“credit repair organization” defined in 15 U.S.C. §1679a(3) – because the obligation under this 

section arises only where file information is disputed “by the consumer” who notifies the agency 

“directly” of such dispute. A CRA is not required to respond to a dispute of information that the 

consumer merely conveys to others, although furnishers of information have independent duties 

with respect to those disputes. (See also discussion in comment 607(b)-2 of CRAs’ duties to 

correct errors that come to their attention.)259 However, a CRA must investigate a dispute by the 

consumer to another CRA to which it has provided reports for resale, after the reseller refers it to 

the originating CRA. See comment 611(f)-1.

Section 611(b) provides, “If the reinvestigation does not resolve the dispute, 

the consumer may file a brief statement setting forth the nature of the dispute. 

The consumer reporting agency may limit such statements to not more than one 

hundred words if it provides the consumer with assistance in writing a clear 

summary of the dispute.”

Section 611(c) provides, “Whenever a statement of a dispute is filed, unless 

there is reasonable grounds to believe that it is frivolous or irrelevant, the 

consumer reporting agency shall, in any subsequent consumer report containing 

the information in question, clearly note that it is disputed by the consumer and 

provide either the consumer’s statement or a clear and accurate codification or 

summary thereof.”

1. CONSUMER STATEMENT OF DISPUTE

If the investigation does not resolve the dispute, the consumer may file a statement of dispute, 

which the CRA may limit to one hundred words. The “one hundred word” limitation applies to 

each disputed item. A consumer who disputes multiple items of information in his or her file may 

submit a 100-word statement as to each item for which the dispute has not been resolved.260

2. CONVEYING DISPUTE STATEMENTS TO RECIPIENTS OF SUBSEQUENT REPORTS

A CRA may not merely tell the recipient of a subsequent report containing disputed information 

that the consumer’s statement is on file, but must provide the statement or a clear and accurate 
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summary.261 This section does not require the CRA to exactly duplicate the organization or styles 

used in the consumer’s written dispute.262

Section 611(d) requires that, upon a consumer’s request, the CRA shall notify 

certain prior consumer report recipients of the deletion of inaccurate or unverifiable 

information or of a consumer’s statement of dispute. 

Section 611(e) provides for the Commission to transmit consumer complaints 

relating to the dispute process to nationwide CRAs, who must report regularly on 

the disposition of such complaints to the Commission, which in turn must annually 

report to Congress on the process. Starting July 21, 2011, the Bureau assumes the 

duties provided in this section.

Section 611(f) provides a special procedure for resellers to investigate disputes. 

1. SPECIAL RULE FOR DISPUTES DIRECTED TO RESELLERS

When a consumer disputes information in his or her file with a reseller of consumer reports who 

has received information from another CRA, the reseller must first determine whether the disputed 

item is inaccurate or incomplete because of its own act or omission. If so, it must correct or delete 

the item within 20 days. If not, the reseller must convey the dispute (and all relevant information) 

to any CRA from which it received the disputed information. 

Section 612 – Charges for Certain Disclosures 15 USC 1681j

Section 612(a)(1) requires nationwide CRAs to make free annual file disclosures 

upon consumer request to a centralized source established for that purpose. It also 

requires nationwide “specialty” CRAs, as defined by section 603(x), to make free 

annual file disclosures upon consumer request through a “streamlined” process 

including a toll-free phone number to process such requests. Finally, it directed 

the Commission to issue regulations to implement this process as to both types 

of nationwide CRAs. Starting July 21, 2011, the Bureau assumes rulemaking 

authority under this section. 

1. IMPLEMENTING RULE

The Commission issued regulations implementing the consumer’s right to request free annual file 

disclosures (16 CFR 610, 698 App. D), as required by this section. See 69 Fed. Reg. 35468, 35496, 

35500 (June 24, 2004). It later amended and expanded the regulations. See 75 Fed. Reg. 9736 

(March 3, 2010).

2. DIFFERENT OBLIGATIONS OF “NATIONWIDE” AND “NATIONWIDE SPECIALTY” CRAS

Section 612(a)(1)(A) and (B) require nationwide CRAs to make free annual file disclosures to 

consumers only when the requests come through the centralized source created for receiving such 

requests. Section 612(a)(1)(C), on the other hand, requires nationwide specialty CRAs to make 
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free annual file disclosures to consumers who submit their requests directly to the CRAs through a 

streamlined process.

Section 612(b) provides that CRAs must make free file disclosures upon a 

consumer’s request within 60 days of the consumer receiving an adverse action 

notice or a risk-based pricing notice. Section 612(c) provides for free file 

disclosures to a consumer “once during any 12-month period without charge 

to that consumer if the consumer certifies in writing that the consumer (1) is 

unemployed and intends to apply for employment in the 60-day period beginning 

on the date on which the certification is made; (2) is a recipient of public welfare 

assistance; or (3) has reason to believe that the file on the consumer at the 

agency contains inaccurate information due to fraud.” Section 612(d) states that 

nationwide CRAs must make disclosures without charge if there is a fraud alert in 

the consumer’s file. 

1. CONSUMERS MAY BE ENTITLED TO MULTIPLE FREE ANNUAL FILE DISCLOSURES (“FREE REPORTS”)

All consumers are entitled to one free annual file disclosure from nationwide CRAs under section 

612(a)(1). Some consumers are entitled to additional free disclosures because they fall into certain 

categories (i.e., they are unemployed or on welfare). Other consumers are entitled to additional free 

disclosures as the result of specified events (i.e., they have received adverse action or risk-based 

pricing notices, placed fraud alerts in their files, or found information resulting from fraud in their 

files). As a result, a single consumer may be entitled to more than one free disclosure in a year. For 

example, a consumer is entitled to a free file disclosure from a CRA following receipt of an adverse 

action notice, even if he or she obtained “annual” free disclosures from that CRA two months 

previously and would not be entitled to an additional free annual disclosure for another ten months.

Section 612(f) states that CRAs may “impose a reasonable charge on a 

consumer” for providing file disclosures in circumstances other than the ones 

described in this section. CRAs may also impose such a reasonable charge when 

they provide a statement, codification, or summary to consumer report recipients 

at the request of the consumer following an investigation under section 611. The 

Commission must increase the maximum charge for a file disclosure annually 

based on the Consumer Price Index. Starting July 21, 2011, the Bureau assumes 

that duty. Section 612(e) prohibits any other charge to consumers for disclosures 

and any other notices required by the FCRA. 

1. MAXIMUM CHARGE BY CRAS FOR DISCLOSURES

Section 612 sets forth certain situations when CRAs are required to provide free file disclosures, 

and otherwise limits charges to consumers, as discussed in comment 612(b/c/d)-1. This subsection 

provided for an $8.00 maximum when it was added to the FCRA in 1996, and directed the 

Commission annually to increase that amount based on the Consumer Price Index. Before the 

end of each year since enactment of this provision, the Commission has announced the maximum 
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allowable charge for the following calendar year. As of January 1, 2011, the maximum allowable 

charge is $11.00.

Section 613 – 15 USC 1681k

Public Record Information for Employment Purposes

Section 613(a) provides that a CRA, when it compiles and provides public record 

information that is likely to have an adverse effect on a consumer’s ability to obtain 

employment, shall either (1) notify the consumer at the time such information is 

provided to an employer or potential employer or (2) maintain strict procedures to 

insure that the information is complete and up to date. It further provides that “items 

of public record relating to arrests, indictments, convictions, suits, tax liens, and 

outstanding judgments shall be considered up to date if the current public record 

status of the item at the time of the report is reported.” Section 613(b) provides 

an exemption to a federal agency or department when the head of the agency or 

department (or an appropriate delegate) makes certain written findings.

1. RELATION TO OTHER SECTIONS

A CRA that furnishes public record information must also follow reasonable procedures to assure 

maximum possible accuracy of that information as required by section 607(b), even if it chooses 

to comply with this section by providing the subsection (a)(1) notice when providing public record 

information to employers.263 An employer using the information must comply with the notice, 

consent, and disclosure provisions of section 604(b).264

2. GENERAL

A CRA that furnishes public record information for employment purposes must comply with 

either subsection (a)(1) or (a)(2), but need not comply with both.265 CRAs that provide reports for 

employment purposes must comply with this section, even if they are merely resellers of consumer 

reports obtained from other CRAs.266 The procedures required by this section cannot be waived by 

the consumer to whom the report relates.267

3. METHOD OF PROVIDING NOTICE UNDER SUBSECTION (a)(1)

A CRA may use first class mail or other reasonable means to notify consumers that it is providing 

public record information for employment purposes under subsection (a)(1).268

4. STRICT PROCEDURES UNDER SUBSECTION (a)(2)

A. Stored public information. A CRA that furnishes consumer reports for employment purposes 

based on previously acquired public record information (purchased periodically from a third 

party) must verify that any such information is complete and up to date, in order to comply 

with subsection (a)(2).269

B. Only reported “items” must be complete and up-to-date. This section requires that each 

“item of [public record] information” reported be complete and up to date. For example, if 

the CRA reports an indictment, it must also report any dismissal or acquittal available on the 

public record as of the date of the report. Similarly, if the CRA reports a conviction, it must 
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report a reversal that has occurred on appeal. In some cases, often at an employer’s request, 

a report may deliberately omit data such as arrest or probation data. Although the report is 

not a “complete” reflection of every single piece of public record information, because the 

requirement to report complete and up-to-date information is item-specific, the CRA complies 

if its report includes the current, complete, and up-to-date public record status of each 

individual item reported.270

Section 614 – 15 USC 1681l

Restrictions on Investigative Consumer Reports

Section 614 provides, “Whenever a consumer reporting agency prepares an 

investigative consumer report, no adverse information in the consumer report 

(other than information which is a matter of public record) may be included in a 

subsequent consumer report unless such adverse information has been verified 

in the process of making such subsequent consumer report, or the adverse 

information was received within the three-month period preceding the date the 

subsequent report is furnished.”

Section 615 – Requirements on Users of Consumer Reports 15 USC 1681m

Section 615(a) provides that any party who “takes any adverse action with 

respect to any consumer that is based in whole or in part on any information 

contained in a consumer report” shall provide to the consumer orally, in writing, 

or electronically: notice of the adverse action; the name, address, and telephone 

number of the CRA (toll-free telephone number, in the case of a nationwide 

CRA); a statement that the CRA “did not make the decision to take the adverse 

action” and is unable to provide specific reasons for the action; and notice of the 

consumer’s right to obtain a free file disclosure from the CRA, and to dispute with 

a CRA the accuracy or completeness of any information in a consumer report 

furnished by the CRA. Effective July 21, 2011, the party taking the adverse action 

must also disclose any numerical credit score that contributed to the adverse 

action, along with certain related information. 

1. RELATION TO OTHER SECTIONS AND REGULATION B

A. FCRA – employment. An employer who uses consumer reports to make employment decisions 

must make the adverse action disclosures required by both section 604(b) and section 615(a), 

even though there is some duplication of the disclosures required by those two subsections 

in the employment context.271 Because the section 604(b)(3) notice must be provided to 

consumers before adverse action is taken, and the section 615(a)(2) notice must be provided 

after adverse action is taken, they may not be included in the same document.272

B. FCRA – risk-based pricing. Section 615(h) generally requires creditors, in those cases that are 

not “adverse action” but involve extensions of credit on terms materially less favorable than 
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those available to a substantial portion of customers, to provide a “risk-based pricing notice” 

when the decision is based in whole or in part on a consumer report. See comment 615(h)-1.

C. FCRA – miscellaneous. Section 606 also requires users of investigative consumer reports to 

make certain disclosures to consumers.273 Section 603(k) defines the term “adverse action.”

D. ECOA. Creditors should not confuse compliance with the adverse action notice provisions of 

section 615(a) with compliance with the Equal Credit Opportunity Act, 15 U.S.C. §§1691 et 

seq. and Regulation B, 12 CFR Part 202, which require disclosure of the reasons for adverse 

action. Providing the adverse action notice required by section 615(a), therefore, does not 

necessarily constitute compliance with Regulation B, although a creditor can comply with both 

the FCRA and the ECOA through the use of a single notice. See 12 CFR Part 202, Appendix C 

(model adverse action notices that can be used to comply with FCRA and ECOA).274

2. ADVERSE ACTION INVOLVING CREDIT

A. In general. A creditor must provide an adverse action notice when it denies the consumer’s 

request for credit or for increased credit (including a rejection based on a scoring system) 

based in whole or in part on a consumer report.275 Where a consumer applies for credit on 

particular terms, is offered credit only on less favorable terms based on information in his/her 

consumer report, and refuses to accept those terms or use the credit offered, the consumer is 

entitled to an adverse action notice. However, if the consumer accepts the credit offered, the 

consumer is not entitled to the adverse action notice.276 See comment 603(k)(1)(A)-1, which 

sets forth the definition of “adverse action” under the ECOA and its implementing Regulation 

B that also serves as the definition of “adverse action” for FCRA purposes under section 

603(k)(1)(A). However, the consumer may be entitled to a “risk-based pricing notice” under 

section 615(h).

B. Multiple applicants. When there are two applicants, a creditor must provide an adverse action 

notice to both applicants if the application is denied, even in part, based on information in 

a co-applicant’s consumer report. However, a creditor need not provide a guarantor with 

an adverse action notice, even if the application is denied in whole or in part based upon 

information from the consumer report of the guarantor. Regulation B states that only an 

“applicant” can experience “adverse action” in a credit context and excludes a guarantor from 

its definiton of “applicant.” 12 CFR Part 202.2(c)(1) and (e). See comment 603(k)(1)(A)-3.277

3. ADVERSE ACTIONS INVOLVING INSURANCE

A. In general. An insurer that refuses to issue a policy, or charges a higher than normal premium, 

based on a consumer report is required to comply with section 615(a).278 See comments 603(k)

(1)(B)(i)-1&2.

B. Variations in premiums offered. In offering a discounted premium rate for those with “good 

credit,” an insurance company must provide an adverse action notice when (1) it decides not 

to offer the discounted rate to an existing policyholder upon renewal, based on the consumer’s 

credit report; (2) it offers the higher rate to a potential customer based on a credit report 

that indicates that the individual does not qualify for the discounted rate; or (3) it quotes the 

discounted rate to a potential customer but later charges a higher rate due to the consumer’s 

credit report. Similarly, a health insurer that increases premiums of a consumer, in whole or in 

part based on a consumer report, must provide an adverse action notice.
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C. Mortgage insurance. A mortgage insurer that refuses to insure a consumer loan, based in whole 

or in part on a consumer report, must provide the consumer with an adverse action notice,

because the insurer has made a “denial in connection with the underwriting of insurance” that 

requires the notice. Such refusal is an “adverse action” even if the loan application itself is 

ultimately approved when a second insurer agrees to provide coverage.279

D. Actions applicable to entire existing class of policyholders. An adverse action that applies to 

all or substantially all of an established class of policyholders, such as a generally applicable 

increase in premiums or decrease in coverage, is not “based on” a consumer report that was 

used at a prior time to assign the consumer to that class if the insurer provided an adverse 

action notice at that prior time.

4. ADVERSE ACTIONS INVOLVING EMPLOYMENT

A. General. An employer must provide an adverse action notice to an individual who has 

applied for employment and has been rejected based on a consumer report. Similarly, an 

employer must provide an adverse action notice to an existing employee who is subject to an 

employment decision that adversely affects his or her employment, such as termination or 

discipline, based in whole or in part on a consumer report. See comment 603(k)(1)(B)(ii)-2. 

B. Additional adverse action duties of employers. In addition to providing the adverse action 

notice required by this section, employers must also comply with section 604(b)(3) by 

supplying the consumer (job applicant or employee) with a copy of the consumer report and a 

written statement of consumer rights under the FCRA before taking adverse action.

5. ADVERSE ACTION NOT INVOLVING CREDIT, INSURANCE OR EMPLOYMENT 

A business that takes adverse action against a consumer in a context other than credit, insurance, 

or employment (e.g., a residential landlord), based in whole or in part on a consumer report, must 

also provide an adverse action notice. A business that determines, based on information contained 

in a consumer report, that a customer must pay a cash deposit (or a larger deposit) not required 

of all consumers, is obligated to provide a notice of adverse action to that customer.280 An owner 

of a residential property that denies a consumer’s rental application, or increases the rental or 

deposit charges, must provide an adverse action notice when information from a consumer report 

contributed in any way to such action. See comment 603(k)(1)(B)(iv)-3&4.

6. CREDITORS OR INSURERS USING “PRESCREENED” MAILING LISTS

A creditor or insurer is not required to provide adverse action notices regarding mailing lists 

prepared by CRA “prescreening” services. Consumers who have not applied for credit or insurance 

have not suffered adverse action in being excluded from such lists of consumers to be solicited 

for these products.281 However, a consumer who agrees to accept a prescreened offer of credit or 

insurance, but is later denied based on a subsequent report, is entitled to an adverse action notice.

7. ADVERSE ACTION “BASED IN WHOLE OR IN PART ON ANY INFORMATION CONTAINED IN A 

CONSUMER REPORT”

A. No requirement that information in consumer report be derogatory. A user of a consumer 

report that takes adverse action wholly or partly because of information contained in a 

consumer report must provide the required notice to the consumer, even if the information 

is not derogatory. For example, the user must give the notice if the action is based wholly or 

partly on the absence of a file or on the fact that the file contained insufficient trade lines.282
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B. Denial based partly on a consumer report. The user of a consumer report must provide an 

adverse action notice even if the adverse action is based only partly on a consumer report.283

Similarly, if information received from a consumer report was used to prompt further 

investigation of the applicant’s insurability, and that investigation leads to adverse action, the 

consumer is entitled to receive an adverse action notice.

8. ADVERSE ACTION BASED ON DIRECT INFORMATION

This section does not require any notice of adverse action if such action is based solely on 

information provided by the consumer in an application, or is based on past experience in direct 

transactions with the consumer.284

9. NOTICE PROVIDED BY THIRD PARTY

A user may contract with a third party to deliver the adverse action notice to the consumer, but the 

user remains liable if the notice is not provided.285

10. CONTENT OF THE NOTICE

The consumer report user must provide the name and address of the CRA from which it obtained 

the consumer report, even if that CRA obtained all or part of the report from one or more other 

CRAs.286 See section 607(e) concerning the obligation of the intermediary agency to identify the 

“end-user” to the originating CRA. 

Section 615(a)(1)’s mandate that the user provide “notice of the adverse action” does not require 

the use of the word “adverse” or the like, but it does require that the notice convey to the consumer 

accurately that the report led to less than optimal results for the consumer. The adverse action 

notice should not include untrue statements. For example, a report user may not state that the CRA 

from which it obtained the consumer report “did not make the decision to take the adverse action” 

– one of the specified disclosures – if that statement is factually incorrect (e.g., when an employer 

has asked the CRA to provide an opinion on whether a job applicant should be hired).287

11. LIMITED SCOPE OF REQUIREMENTS

This section does not require that creditors disclose their credit criteria or standards, or that 

employers furnish copies of personnel files to former employees. In most cases, this section 

does not require that the user provide advance notification to consumers before a consumer 

report is obtained. (But see section 606 regarding notice of investigative consumer reports, and 

section 604(b) regarding reports for employment purposes.)288 This section does not impose any 

requirements on CRAs to compel users of consumer reports to provide adverse action notices; 

rather, it imposes the duty to provide adverse action notices only on users.289

12. REASONS FOR ACTION 

Unlike the ECOA, the FCRA does not require report users to disclose specific reasons for taking 

adverse action, or to identify information from a consumer report that contributed to the action. 

However, should a report user choose to tell a consumer the reasons for the adverse action, nothing 

in the FCRA precludes it from doing so.290

Section 615(b)(1) provides different rights to consumers who suffer adverse action 

based on information obtained by “a person other than a consumer reporting 

agency” in the credit context. At the time the creditor informs the consumer of an 

adverse action, it must disclose the consumer’s right to make a written request 
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within 60 days for the “nature of the information” that led to the adverse action. 

Upon receiving such a request, the creditor must comply. Section 615(b)(2)

provides similar rights to consumers who suffer adverse action based on certain 

information received from an affiliate of the party taking the action.

1. DENIAL OF CREDIT BASED ON INFORMATION FROM “PERSONS OTHER THAN CONSUMER 

REPORTING AGENCIES”

Subsection (b)(1) imposes requirements on a creditor when it denies, or increases the charge for 

credit, based on information from a non-affiliated “third party” source, which is a source other than 

(1) a CRA, (2) the creditor’s own files, or (3) the consumer’s application. Examples of “persons 

other than consumer reporting agencies” whose information is covered by this section include 

application references (creditors, employers, landlords) or the public record. This subsection also 

requires the creditor to provide a disclosure when it denies a consumer’s application based on 

information obtained directly from another lender, even if the other lender’s name was furnished to 

the creditor by a CRA.291

2. SUBSTANCE OF REQUIRED DISCLOSURES

When the adverse action is communicated to the consumer, the creditor must clearly and accurately 

disclose to the consumer his or her right to make a written request for the disclosure of the 

nature of the third party information that led to the adverse action. Upon timely receipt of such a 

request, the creditor need disclose only the nature of the information that led to the adverse action 

(e.g., history of late rent payments or bad checks); it need not identify the source that provided 

the information or the criteria that led to the adverse action. A statement of principal, specific 

reasons for adverse action based on third party information that is sufficient to comply with the 

requirements of Section 701(d) of the ECOA and its implementing Regulation B, 12 CFR 202.9(b)

(2) (e.g., “unable to verify employment”) constitutes disclosure of the “nature of the information” 

under subsection (b).292

3. TIMING OF REQUIRED DISCLOSURES

A creditor may comply with subsection (b)(1) by providing a statement of the nature of the third 

party information that led to the adverse action when it notifies the consumer of the action.293

4. SECTION APPLICATION LIMITED TO “CREDIT”

Landlords that charge monthly rent to tenants do not have an obligation under section 615(b)(1) 

to provide notices when they base an adverse landlord-tenant decision upon information obtained 

from persons other than CRAs (e.g., from an applicant’s previous landlord) because section 615(b)

(1) only applies to “credit” as defined in section 603(r)(5). Landlords do, however, have obligations 

to provide adverse action notices if they take adverse actions based on consumer reports.294

Section 615(c) provides that a party, when charged with failing to provide 

adverse action notices, may avoid liability by showing that at the time of 

the alleged violation, he maintained reasonable procedures to provide the 

required notice.
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Sections 615(d) requires creditors or insurers who make prescreened offers 

to consumers to provide a clear and conspicuous statement (in a type size and 

manner specified under Commission rules) that “(A) information contained in the 

consumer’s consumer report was used in connection with the transaction; (B) the 

consumer received the offer of credit or insurance because the consumer satisfied 

the criteria for credit worthiness or insurability under which the consumer was 

selected for the offer; and (C) ... the credit or insurance may not be extended if, 

after the consumer responds to the offer, the consumer does not meet the criteria 

used to select the consumer for the offer or ... does not furnish any required 

collateral ....” It further requires that the notice inform the consumer of the right to 

“opt out” of prescreening and provide the address and toll-free telephone number 

to contact to opt out, using a format to be established by rule by the Commission, 

in consultation with the Federal financial agencies. Starting July 21, 2011, the 

Bureau assumes rulemaking authority under this section. Finally, this section 

specifies that it does not “affect the authority of any Federal or State agency to 

enforce a prohibition against unfair or deceptive acts or practices” in connection 

with prescreening or any other practice.

1. RELATION TO OTHER SECTIONS

This section prescribes specific disclosures when businesses offer “prescreened” products to 

consumers based on their consumer report information. Section 603(l) defines the type of offer that 

is subject to the FCRA’s prescreening provisions. Section 604(c) sets forth the permissible purpose 

for and limitations on prescreening. Section 604(e) discusses the consumer’s right to “opt out” from 

prescreened lists.

2. IMPLEMENTING RULE

The Commission published a rule and model form for the disclosures required by this section 

(16 CFR 642, 16 CFR 698 App. A). See 70 Fed. Reg. 5022, 5025, 5032-33 (Jan. 31, 2005). The 

rule requires that a “short” notice be on the front of the first page of any written solicitation, which 

informs consumers of their right to opt-out of future prescreened offers, provides a toll-free number 

to opt out, and directs consumers to a “long” notice that complies in full with this section.

3. DECEPTIVE OFFERS

This section does not limit federal or state enforcement against unfair or deceptive practices in 

prescreened offers. For example, a solicitation may not tell consumers they are “pre-approved” 

when in fact the creditor or insurer re-evaluates consumers who respond to the solicitation. 

Similarly, a creditor’s phone representatives may not falsely state that they are representing the 

consumer’s existing creditor, or that an existing creditor has referred their application. 

Section 615(e) requires the Commission and the Federal financial agencies to 

issue guidelines and regulations for financial institutions and certain creditors, 

regarding identity theft with respect to customers of such entities. 
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1. IMPLEMENTING RULES

The Commission and the Federal financial agencies issued rules to implement this provision (16 

CFR 681.2-.3). See 72 Fed. Reg. 63718, 63772-73 (Nov. 9, 2007)

Section 615(f) generally prohibits the sale, transfer, or placement for collection 

of a debt that the creditor has been notified pursuant to section 605B may be the 

result of identity theft.

Section 615(g) requires debt collectors handling accounts for a creditor, when 

notified that an obligation may be the result of fraud or identity theft, to (1) so 

notify the creditor and (2) upon request by the consumer, furnish application and 

transaction records information to which a consumer who was “not a victim of 

identity theft” would be entitled.

1. RELATION TO OTHER SECTIONS

Section 609(e) provides, among other things, that identity theft victims have a right to receive, 

free of charge, application and transaction records (e.g., invoices, credit applications, or account 

statements) associated with the fraudulent use of their accounts, from any business that dealt with 

an alleged identity thief. This section provides a parallel right with respect to debt collectors.

2. RELATION TO FAIR DEBT COLLECTION PRACTICES ACT (FDCPA)

Section 809(g) of the FDCPA (“Validation of Debts”) permits consumers who are contacted 

by a debt collector about a debt to require the collector to provide written notice with specified 

information to the consumer before attempting to collect the debt. Section 615(g) provides that, 

in the case of an obligation fraudulently incurred in the name of the consumer, the identity theft 

victim can require a debt collector to provide that same information as would have been required 

by the FDCPA (i.e., to which the consumer would be entitled if he or she was “not a victim of 

identity theft”) or similar state law.

Section 615(h) requires what is commonly called a “risk-based pricing notice”

in credit transactions. It provides that “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” that so informs the consumer, and provides 

identifying and contact information on the CRA that provided the report. Effective 

July 21, 2011, the party providing the risk-based pricing notice must also disclose 

any numerical credit score that contributed to the adverse action, along with 

certain related information. This section required the Commission and the Federal 

Reserve Board to jointly prescribe rules implementing the provision. Starting July 

21, 2011, the Bureau assumes rulemaking authority under this section. 
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1. IMPLEMENTING RULES

The Commission and the Board issued regulations to implement this provision (16 CFR 640, 16 

CFR 698 App. B). See 75 Fed. Reg. 2724 (Jan. 15, 2010); 76 Fed. Reg. 41602 (July 15, 2011).

Sections 616-617 – 15 USC 1681n - 15 USC 1681o

Civil Liability for Negligent or Willful Noncompliance

Sections 616 and 617 impose liability for willful noncompliance and negligent 

noncompliance, respectively. The monetary penalties mandated by these two 

sections include actual damages proven by a consumer or a CRA, plus costs and 

attorneys fees. In the case of willful violations, the court may also award punitive 

damages to a consumer.

Section 618 – Jurisdiction of Courts; Limitation of Actions 15 USC 1681p

Section 618 allows civil actions to be brought in any court of competent 

jurisdiction not later than the earlier of (1) two years after the date of discovery by 

the plaintiff of the violation or (2) five years after the date on which the violation 

occurred.

Section 619 – Obtaining Information Under False Pretenses 15 USC 1681q

Section 619 provides criminal sanctions against any person who knowingly and 

willfully obtains information about a consumer from a CRA under false pretenses.

Section 620 – 15 USC 1681r

Unauthorized Disclosures by Officers or Employees

Section 620 provides criminal sanctions against any officer or employee of a CRA 

who knowingly and willfully provides information concerning an individual from 

the agency’s file to a person not authorized to receive it.

Section 621 – Administrative Enforcement 15 USC 1681s

Section 621(a)(1) gives the Commission authority to enforce the FCRA with 

respect to CRAs, users of reports, furnishers of information to CRAs, and all 

others, except to the extent that section 621(b) provides otherwise, and subject 

to coordination with the Bureau pursuant to subtitle B of the Consumer Financial 

Protection Act of 2010.
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1. THE COMMISSION’S JURISDICTION

The Commission may use its cease-and-desist power and other procedural, investigative, and 

enforcement powers under the FTC Act to secure compliance with the FCRA, irrespective of any 

jurisdictional tests in the FTC Act. For example, even though the FTC Act excludes nonprofit 

organizations from the FTC’s jurisdiction, the Commission could take enforcement action against 

a nonprofit organization for a violation of the FCRA. In addition, under general principles of 

constitutional law, the Commission’s jurisdiction to enforce FCRA violations extends to activities 

conducted in the United States or affecting consumers in the United States.295

Section 621(a)(2) gives the Commission authority to seek civil penalties for 

violations of the FCRA in an amount not more than $2,500 per violation, “except 

as otherwise provided by subtitle B of the Consumer Financial Protection Act of 

2010” (titled “General Powers of the Bureau”). In setting a civil penalty amount, 

it requires a court to consider “the degree of culpability, any history of prior such 

conduct, ability to pay, effect on ability to continue to do business, and such other 

matters as justice may require.”

1. GENERAL

Section 621 governs FCRA enforcement actions brought by the Commission, other federal 

agencies, and the states, and provides for various monetary and injunctive penalties. 

2. CIVIL PENALTIES

At the time of enactment in 1996, this provision allowed the Commission to seek monetary 

penalties for knowing FCRA violations of up to $2,500 per violation in a civil action brought in 

federal district court.296 Pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990, 

the Commission subsequently increased the maximum civil penalty to $3,500 per violation. See 74 

Fed. Reg. 857 (Jan. 9, 2009).

Section 621(a)(3) states that a court may not impose a civil penalty for a violation 

of section 623(a)(1) against any furnisher of information, unless the Commission 

has obtained an injunction against the furnisher, and the furnisher later violates the 

injunction.

Section 621(b) assigns FCRA jurisdiction to other federal agencies that regulate 

certain financial institutions, common carriers, air carriers, and certain other 

businesses in the agricultural, commodities, and securities industries. (Subtitle B of 

the Consumer Financial Protection Act of 2010 provides for cooperation among 

the Bureau and such agencies.) Section 621(c) allows states to enforce the FCRA, 

with certain specified limitations. 

Section 621(d) gives agencies other than the FTC the power to enforce the FCRA 

in the same manner that they would enforce other laws within their jurisdiction.
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Section 621(e) provides the Bureau with authority to prescribe regulations under 

the FCRA, “except with respect to sections 615(e) and 628.”

1. RULEMAKING AUTHORITY

This subsection confers general FCRA rulemaking authority on the Bureau, even as to entities over 

which FCRA enforcement is assigned to or concurrent with another agency. Several provisions in 

the FACT Act, and sections of the FCRA added by the FACT Act, directed the Commission and 

other agencies to promulgate rules in specific areas. After July 21, 2011, the Bureau will assume 

rulemaking authority under the FCRA except for the “red flags” and “disposal” rules assigned to 

the Commission and other federal agencies by sections 615(e) and 628 (respectively) of the FCRA, 

and to the Commission for the motor vehicle sales industry by section 1029 of the Consumer 

Financial Protection Act of 2010.

Section 621(f) provides for coordination of consumer complaints relating to 

identity theft among creditors, nationwide CRAs, the Commission, and Federal 

financial agencies. It required the Commission (in consultation with the Federal 

financial agencies) to develop model forms and procedures for identity theft victims 

to contact CRAs and creditors. Starting July 21, 2011, the Bureau will assume 

responsibility for these functions.

1. FORMS AND PROCEDURES FOR IDENTITY THEFT VICTIMS

The Commission published forms and procedures for identity theft victims, as required by this 

provision. See 70 Fed. Reg. 21792 (Apr. 27, 2005). 

Section 621(g) permits, but does not require, the Commission to issue guidance 

with respect to the identification of furnishers of medical information under Section 

623(a)(9). Starting July 21, 2011, the Bureau will assume responsibility for the 

guidance permitted by this section.

1. RELATION TO OTHER SECTIONS

Section 604(g)(1) allows CRAs to report information about debts arising from the receipt of 

medical services, products, or devices only where the identity of the furnisher is coded to avoid 

identifying the provider and nature of the transaction. Section 605(a)(6)(A) describes the coding 

requirements for the reporting of names, addresses and phone numbers of medical information 

furnishers. Section 623(a)(9) requires medical information furnishers to disclose their status if they 

report information to CRAs. 

Section 622 – 15 USC 1681s-1

Information on Overdue Child Support Obligations

Section 622 requires CRAs to include certain information on overdue child support 

obligations in consumer reports they provide to those with a permissible purpose. 
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Section 623 – Duties of Furnishers of Information to CRAs 15 USC 1681s-2

Section 623(a)(1)(A) prohibits furnishing information to any CRA if the furnisher 

“knows or has reasonable cause to believe that the information is inaccurate.”

However, section 623(a)(1)(C) provides a safe harbor if the furnisher clearly and 

conspicuously specifies an address where consumers can send disputes concerning 

the accuracy of information about them.

1. GENERAL

Persons may furnish information concerning their transactions with consumers to CRAs and others, 

and CRAs may gather information, without consumers’ permission and over their objection.

2. FURNISHER ADDRESS FOR DISPUTING INFORMATION

An address specification is effective only if the furnisher “clearly and conspicuously” 

communicates the address to consumers. For example, the furnisher could mail a letter to the most 

recent address supplied by the consumer, consisting solely of information about where consumers 

should send dispute notices. A creditor that provides regular billing statements may include the 

address in such statements.

Section 623(a)(2) provides, “A person who (A) regularly and in the ordinary 

course of business furnishes information to one or more consumer reporting 

agencies about the person’s transactions or experiences with any consumer; and 

(B) has furnished to a consumer reporting agency information that the person 

determines is not complete or accurate, shall promptly notify the consumer 

reporting agency of that determination and provide to the agency any corrections 

to that information, or any additional information, that is necessary to make the 

information provided by the person to the agency complete and accurate, and 

shall not thereafter furnish to the agency any of the information that remains not 

complete or accurate.”

1. RELATION TO OTHER SECTIONS

Section 623(e) required the Federal financial agencies and the Commission to issue guidelines and 

regulations on the “accuracy and integrity” of information supplied to CRAs, which they published 

in 2009. See comment 623(e)-1. Starting July 21, 2011, the Bureau assumes this rulemaking 

authority.

2. CESSATION OF RELATIONSHIP WITH CRA

If a furnisher of information to a CRA determines that previously provided information “is not 

complete or accurate,” it must “promptly notify” the CRA and provide anything needed to make the 

information complete and accurate. This obligation applies even when a furnisher no longer has a 

contractual relationship with the CRA to which it originally furnished information.297

Section 623(a)(3) provides, “If the completeness or accuracy of any information 

furnished by any person to any consumer reporting agency is disputed to such 
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person by a consumer, the person may not furnish the information to any consumer 

reporting agency without notice that such information is disputed by the consumer.”

1. RELATION TO OTHER SECTIONS

Section 623(a)(8) allows consumers to dispute items directly with furnishers, in accord with rules 

that this section required the Commission and the Federal financial agencies to establish. See 

comment 623(a)(8)-1. Starting July 21, 2011, the Bureau assumes that rulemaking authority.

2. GENERAL

This section provides that, when a consumer disputes the completeness or accuracy of any 

information furnished to a CRA, the furnisher may not furnish the information in question to the 

CRA without notice that it is disputed by the consumer. It addresses the furnisher’s obligation 

only when the furnisher continues to report disputed information. The furnisher may choose to 

temporarily cease reporting the disputed information while it investigates the matter. After the 

investigation, the furnisher may either (1) correct the information or (2) report the item as disputed 

by the consumer.298

Section 623(a)(4) provides, “A person who regularly and in the ordinary course 

of business furnishes information to a consumer reporting agency regarding a 

consumer who has a credit account with that person shall notify the agency of 

the voluntary closure of the account by the consumer, in information regularly 

furnished for the period in which the account is closed.”

Section 623(a)(5)(A) provides, “A person who furnishes information to a 

consumer reporting agency regarding a delinquent account being placed for 

collection, charged to profit or loss, or subjected to any similar action shall, 

not later than 90 days after furnishing the information, notify the agency of the 

date of delinquency on the account, which shall be the month and year of the 

commencement of the delinquency on the account that immediately preceded the 

action.”

1. RELATION TO OTHER SECTIONS

Section 605(c)(1) requires a CRA receiving collection, chargeoff, or similar information about an 

account to use the same date set forth in this section to calculate the date when the CRA may no 

longer report the delinquency because the information is obsolete. 

2. GENERAL

Furnishers of consumer information to CRAs must provide the month and year of the 

commencement of the delinquency that immediately preceded placement for collection, charge 

to profit or loss, or similar action. They may not substitute an alternate, later date such as a “paidto-date” denoting the due date of the last paid periodic installment.299 The month and year of the 

commencement of the delinquency that immediately preceded the chargeoff is the month the first 

payment was missed, regardless of how long after delinquency the creditor waits to report the 

chargeoff to the CRA.300
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

3. “COMMENCEMENT OF DELINQUENCY” AS FIRM DATE

The “commencement of delinquency” date is not changed where an account is in arrears and 

the consumer makes a later payment, but does not bring the account up to date.301 Neither sale 

of the account by the creditor, nor a payment on or dispute about the account by the consumer, 

changes the allowable period for a CRA to report a chargeoff because the commencement of the 

delinquency remains the same.302

4. “SIMILAR ACTION”

Section 623(a)(5), which applies to an account placed for collection, charged to profit or loss, “or 

subjected to any similar action,” would apply, for example, where a vehicle has been “repossessed” 

or “voluntarily repossessed.”303

Section 623(a)(5)(B) provides a “rule of construction” for the “commencement of 

delinquency” that applies in certain circumstances to credit account information 

on delinquent accounts supplied by a furnisher, provided that the consumer 

has not disputed the information. In such cases, the furnisher complies (1) if the 

creditor to which the account was owed at the time when the commencement of 

the delinquency occurred previously reported a date of delinquency (“DoD”) to a 

CRA, and the furnisher reports that date to the CRA as the DoD, (2) if the previous 

creditor did not report the DoD to a CRA, and the furnisher follows reasonable 

procedures to obtain the DoD from the creditor or other reliable source and reports 

that date to the CRA as the DoD; or (3) if the previous creditor did not report the 

DoD to a CRA and the DoD cannot be reasonably obtained, and the furnisher 

follows reasonable procedures to ensure the DoD it reports to the CRA precedes 

the date on which the account is placed for collection, charged to profit or loss, or 

subjected to any similar action.

1. RULE OF CONSTRUCTION

If the date of delinquency has been provided to a CRA by the creditor to whom the debt was owed 

when the account became delinquent (scenario 1 in this section), any subsequent furnisher must 

report that date and may not use the alternatives set forth in scenarios 2 or 3, regardless of whether 

the prior creditor has supplied that information to the furnisher. The other options (scenarios 2 and 

3) apply only where no prior date of delinquency had been reported.

Section 623(a)(6) requires furnishers to have reasonable procedures to respond 

to any notification that they receive from a CRA about an identity theft “block,”

and to prevent refurnishing such “blocked” information. It also states that after a 

consumer has submitted an identity theft report “at the address specified by (the 

furnisher) for receiving such reports,” the furnisher may not report such information 

to a CRA unless it “subsequently knows or is informed by the consumer that the 

information is correct.”
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1. RELATION TO OTHER SECTIONS

The terms “identity theft” and “identity theft report” are defined in sections 603(q)(3) and(4), and 

by Commission rules cited in comment 603(q)-2. (Starting July 21, 2011, the Bureau assumes 

that rulemaking authority.) Section 605B concerns CRA “blocking” of information resulting from 

identity theft.

2. ADDRESS FOR RECEIVING IDENTITY THEFT REPORTS

A furnisher may “specify” an address for receiving identity theft reports by clearly and 

conspicuously advising the consumer of the address in writing, or electronically if the consumer 

has agreed to the electronic delivery of information from the furnisher. If the furnisher has not 

specified such an address, the furnisher must block the information if the consumer conveys the 

report to the furnisher’s regular address for consumer correspondence.

Section 623(a)(7) requires a “financial institution” that regularly reports negative 

information to nationwide CRAs to provide one clear and conspicuous written 

notice of that practice to consumers, no later than 30 days after first reporting such 

information. After providing the notice, the furnisher may provide further negative 

information “with respect to the same transaction, extension of credit, account, or 

customer without providing additional notice to the customer.” The Federal Reserve 

Board was assigned to provide a brief model form for this purpose. Starting July 

21, 2011, the Bureau will assume that authority.

1. RELATION TO OTHER SECTIONS

This requirement applies to a “financial institution” as defined by the Gramm-Leach-Bliley Act, 15 

U.S.C. § 6809, not a “financial institution” as defined in section 603(t) for other FCRA purposes.

2. MODEL FORMS 

The Board has published model forms (12 CFR 222, App. B). See 69 Fed. Reg. 33281 

(June 15, 2004).

Section 623(a)(8) allows consumers to directly dispute with furnishers the 

accuracy of information supplied to CRAs, in accord with rules required to be 

promulgated by the Commission and Federal financial agencies. (Starting July 

21, 2011, the Bureau will assume rulemaking authority under this section.) It 

requires the furnisher to investigate good faith disputes, considering “all relevant 

information” submitted by the consumer. If the investigation shows that the 

information was inaccurate, the furnisher is required to promptly notify each 

CRA to which it reported the information, and provide to the CRA any correction 

necessary to make the information accurate.

1. IMPLEMENTING REGULATIONS 

The Commission and the Federal financial agencies issued the rules required to implement this 

provision. The Commission rule is codified at 16 CFR Parts 660.4. See 74 Fed. Reg. 31484, 31525-

27 (July 1, 2009). 
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Section 623(a)(9) requires an entity whose principal business is “providing 

medical services, products, or devices,” that furnishes consumer information to 

a CRA, to notify the CRA that it is a “medical information furnisher” for FCRA 

purposes.

Section 623(b) requires that a furnisher that receives a dispute notice from a 

CRA must investigate the disputed information, review all relevant information 

provided by the CRA, and report the results of the investigation to the CRA. If 

the furnisher finds that the information is incomplete or inaccurate, it must report 

those results to all nationwide CRAs to which it furnished the information. If it 

finds that the disputed information is inaccurate or incomplete, or cannot be 

verified, it must modify, delete, or permanently block that item of information (for 

purposes of reporting to CRAs) before the expiration of the period specified by 

section 611(a)(1).

1. GENERAL

Once a CRA notifies a furnisher that a consumer disputes the completeness or accuracy of the 

furnisher’s information, the furnisher is required to conduct an investigation of the disputed 

information, review all relevant information provided by the CRA, and report its findings to the 

CRA (and to other CRAs if it finds the data to be inaccurate or incomplete).304 The obligation to 

investigate under this section is triggered by the receipt of a notification from a CRA; the furnisher 

may not require a separate written request from the consumer before conducting the required 

investigation.305

2. NATURE OF INVESTIGATION

The furnisher’s investigation must be reasonable under the circumstances. It may be either simple 

or complex, depending on the nature of the dispute. See comment 611(a)-2, discussing CRA 

dispute investigations. Unless the furnisher is able to confirm the disputed item of information, it 

must cease reporting it.

Section 623(c) provides that sections 616-617 (which allow individual actions 

for violations of most provisions of the FCRA) do not apply to violations of section 

623(a)&(e) (furnishers providing accurate information to CRAs) or 615(e) (“red 

flags” rules). Section 623(d) provides that those sections “shall be enforced 

exclusively by the federal agencies and officials and the State officials identified in 

section 621.”

Section 623(e) assigned the Commission and Federal financial agencies 

responsibility for promulgation of guidelines and regulations regarding the 

accuracy and integrity of information provided to CRAs. Starting July 21, 2011, 

the Bureau will assume rulemaking authority under this section.
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1. IMPLEMENTING REGULATIONS 

The Commission and the Federal financial agencies issued the rules required to implement this 

provision. The Commission rule is codified at 16 CFR Parts 660.3 and the Appendix to that Part. 

See 74 Fed. Reg. 31484, 31525-27 (July 1, 2009). 

Section 624 – Affiliate Marketing 15 USC 1681s-3

Section 624 provides consumers the right to “opt out” of affiliates’ marketing 

solicitations. There are exceptions for situations where there is a pre-existing 

business relationship or a consumer-initiated communication, among others. 

Section 214(b) of the FACT Act, which is not part of the FCRA, required the 

Commission and Federal financial agencies to prescribe rules to implement this 

provision. Starting July 21, 2011, the Bureau, the Commodities Futures Trading 

Commission, and the Securities and Exchange Commission will assume rulemaking 

authority under this section.

1. IMPLEMENTING RULES 

The Commission and the Federal financial agencies issued rules required to implement this 

provision. The Commission rule is codified at 16 CFR Parts 680 and 698 (Appendix C). See 72 

Fed. Reg. 61424, 61455-64 (Oct. 30, 2007). The other agencies’ rules are codified at 12 CFR Parts 

41.3, 222.3, 334.3, 571.3, 717.3; 70 Fed. Reg. 70664, 70675-96 (Nov. 22, 2005).

Section 625 – Relation to State Laws 15 USC 1681t

Section 625(a) sets forth a general rule that the FCRA preempts state law only to 

the extent that those laws are inconsistent with the FCRA. Sections 625(b) and (c)

then prohibit or limit state law in specified areas, in some cases specifically 

“grandfathering” specified state laws that were in effect before the relevant FCRA 

provisions were enacted.

Section 626 – 15 USC 1681u

Disclosures to FBI for Counterintelligence Purposes

Section 626 requires CRAs to provide consumer reports or specific information in 

their files when a certain supervisory official of the Federal Bureau of Investigation 

certifies in writing that the report or information “is sought for the conduct of an 

authorized investigation to protect against international terrorism or clandestine 

intelligence activities ....” It states that the CRA (and its personnel) may not 

disclose “in any consumer report, that the FBI has sought or obtained” such 

information or report.
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Section 627 – 15 USC 1681v

Disclosures to Governmental Agencies for Counterterrorism Purposes

Section 627 provides for CRAs to provide all information in their files “to a 

government agency authorized to conduct investigations of, or intelligence or 

counterintelligence activities or analysis related to, international terrorism when 

presented with a written certification by [a certain supervisory level official of] 

such government agency that such information is necessary for the agency’s 

conduct or such investigation, activity or analysis.” It states that the CRA (and its 

personnel) may not “disclose to any person, or specify in any consumer report, that 

a government agency has sought or obtained access to information” under this 

provision.

Section 628 – Disposal of Records 15 USC 1681w

Section 628 directs the Commission and other federal agencies to prescribe 

regulations “requiring any person that maintains or otherwise possesses consumer 

information, or any compilation of consumer information, derived from consumer 

reports for a business purpose to properly dispose of any such information or 

compilation.”

1. IMPLEMENTING RULES

The Commission has issued the required rules on the proper disposal of consumer report 

information by entities under its jurisdiction (16 CFR 682). See 69 Fed. Reg. 68690, 68697 (Nov. 

24, 2004)

Section 629 – 15 USC 1681x

Corporate and Technological Circumvention Prohibited 

Section 629 required the Commission to “prescribe regulations to prevent a 

consumer reporting agency from circumventing or evading treatment” as a 

nationwide CRA. Starting July 21, 2011, the Bureau will assume rulemaking 

authority under this section.

1. IMPLEMENTING RULES

The Commission issued rules prohibiting CRAs, including newly-formed firms, from evading 

treatment as a nationwide CRA (16 CFR 611), as required by the provision. See 69 Fed. Reg. 

29061, 29063 (May 20, 2004) and 69 Fed. Reg. 8532, 8533 (Feb. 24, 2004).
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1990 COMMENTS NOT INCORPORATED INTO 2011 SUMMARY

Comment 603(b)-1 Redundant.

Comment 603(c)-1 Redundant.

Comment 603(d)-3C Staff Summary adopts different analysis, now discussed in 604(a)(3)(A)-5.

Comment 603(d)-4B Staff Summary adopts different analysis, now discussed in 603(d)-5A.

Comment 603(d)-4C Staff Summary adopts different analysis, now discussed in 603(f)-5B.

Comment 603(d)-6B Staff Summary adopts different analysis, now discussed in 604(a)(3)(A)-5. 

Comment 603(e)-5 Redundant.

Comment 603(f)-4 Statutory amendment.

Comment 603(f)-6 Redundant.

Comment 603(f)-8 Staff Summary adopts different analysis, now discussed in 603(f)-4.

Comment 603(f)-10 Staff Summary adopts different analysis, now discussed in 603(f)-5B.

Comments 603(i)-1, 2 Statutory amendment.

Comments 604-1A, B, C Redundant.

Comments 604(3)(A)-2 , 3, 4 Statutory amendment.

Comment 604(3)(A)-6 Statutory amendment.

Comment 604(3)(A)-8 Staff Summary adopts different analysis, now discussed in 603(d)-5A.

Comment 604(3)(B)-2 Redundant.

Comment 604(3)(E)-3 Redundant.

Comment 605(a)(1)-1 Statutory amendment.

Comment 605(a)(1)-2 Redundant.

Comment 605(a)(4)-3 Statutory amendment.

Comment 605(a)(5)-1 Statutory amendment.

Comment 605-6 Redundant.

Comments 606-3 Redundant.

Comment 606-4 Statutory amendment.

Comment 607-2F Obsolete.

Comment 607-3C Obsolete.

Comment 607-3D Redundant.

Comment 607-3E Obsolete.

Comment 607-4 Redundant.

Comment 607-5 Obsolete.

Comments 609-2, 3 Statutory amendment.

Comment 609-5 Obsolete.

Comment 609-6 Statutory amendment.

Comment 609-8 Redundant.

Comment 609-12 Statutory amendment. 

Comment 610-1 Statutory amendment. 

Comment 610-3 Statutory amendment. 

Comment 610-5 Statutory amendment. 

Comment 610-6 Not relevant to Commission FCRA enforcement.

Comment 611-10 Statutory amendment.

Comment 611-12 Statutory amendment. 

Comment 612-1 Statutory amendment. 

Comment 612-2 Statutory amendment. 

Comment 615-7 Redundant.

Comment 615-3 Statutory amendment.

Comment 615-8 Statutory amendment.

Comment 615-10 Statutory amendment.

Comment 615-12 Obsolete.

Comment 619-1 Redundant.

Comments 621-1, 2, 3, 4 Not relevant to Commission FCRA enforcement.
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ENDNOTES

1. 1990 Commentary on the Fair Credit Reporting Act, Appendix to Part 600, comment 603(b)-2 (cited herein 

as “1990 comment”). 

2. 1990 comment 603(c)-2.

3. 1990 comment 603(d)-1.

4. Goeke, FTC Informal Staff Opinion Letter, June 9, 1998; Lewis, FTC Informal Staff Opinion Letter, June 

11, 1998.

5. Previously section 603(x). Redesignated section 603(y) effective July 21, 2011. See Public Law 111-203, 

§1088(a)(1)(A). 

6. 1990 comment 603(d)-5C.

7. 1990 comment 603(d)-3A.

8. 1990 comment 603(d)-3B.

9. 1990 comment 603(d)-2.

10. Tatelbaum, FTC Informal Staff Opinion Letter, July 26, 2000.

11. 1990 comment 603(d)-4A.

12. 1990 comment 603(d)-4D.

13. 1990 comment 603(d)-4F.

14. 1990 comment 603(d)-5B.

15. 1990 comment 603(d)-4E.

16. 1990 comment 603(d)-4G.

17. Islinger, FTC Informal Staff Opinion Letter, June 9, 1998; Poquette, FTC Informal Staff Opinion Letter, 

June 9, 1998; Lewis, FTC Informal Staff Opinion Letter, June 11, 1998; Halpern, FTC Informal Staff 

Opinion Letter, June 11, 1998.

18. Slyter, FTC Informal Staff Opinion Letter, June 12, 1998; Pickett, FTC Informal Staff Opinion Letter, July 

10, 1998.

19. Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998.

20. Leathers, FTC Informal Staff Opinion Letter, Sept. 9, 1998; Hinkle, FTC Informal Staff Opinion Letter, July 

9, 1998.

21. 1990 comment 603(d)-5A; 1973 Commission Interpretation #2.

22. 1990 comment 603(d)-5D.

23. 1990 comment 603(d)-6A.

24. 1990 comment 603(d)-6C.

25. 1990 comment 603(d)-6D.

26. 1990 comment 603(d)-6F.

27. 1990 comments 603(d)-7A(1) and 603(d)-7A(3).

28. Islinger, FTC Informal Staff Opinion Letter, June 9, 1998.

29. Hinkle, FTC Informal Staff Opinion Letter, July 9, 1998; Pickett, FTC Informal Staff Opinion Letter, July 

10, 1998.

30. Novak, FTC Informal Staff Opinion Letter, Sept. 9, 1998.

31. 1990 comment 603(d)-7A(2).

32. Novak, FTC Informal Staff Opinion Letter, Sept. 9, 1998.

33. 1990 comment 603(d)-7B(1).

34. 1990 comment 603(d)-7C(1); Kelley, FTC Informal Staff Opinion Letter, July 16, 1998.

35. 1990 comment 603(d)-7C(2).

36. 1990 comment 603(d)-7C(3).
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37. 1990 comment 603(e)-1.

38. 1990 comment 603(e)-2.

39. 1990 comment 603(e)-4.

40. 1990 comment 603(e)-3.

41. 1990 comment 603(e)-7.

42. Hinkle, FTC Informal Staff Opinion Letter, July 9, 1998; Willner, FTC Informal Staff Opinion Letter, March 

25, 1999; Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998.

43. Hinkle, FTC Informal Staff Opinion Letter, July 9, 1998.

44. 1990 comment 603(e)-6.

45. 1990 comment 603(f)-1A.

46. 1990 comment 603(f)-1B.

47. 1990 comment 603(f)-9; 1973 Commission Interpretation #3.

48. 1990 comment 603(f)-12.

49. 1990 comment 603(f)-2.

50. In the matter of First American Real Estate Solutions, LLC (“Credco”), FTC File No. 952 3267 (Oct. 28, 

1998).

51. Le Blanc, FTC Informal Staff Opinion Letter, June 9, 1998.

52. Lee, FTC Informal Staff Opinion Letter, June 28, 1998.

53. Islinger, FTC Informal Staff Opinion Letter, June 9, 1998; Lewis, FTC Informal Staff Opinion Letter, June 

11, 1998.

54. Cast, FTC Informal Staff Opinion Letter, Oct. 27, 1997.

55. Credco, FTC File No. 952 3267.

56. Leathers, FTC Informal Staff Opinion Letter, Sept. 9, 1998.

57. Sum, FTC Informal Staff Opinion Letter, Sept. 15, 1999.

58. 1990 comment 603(f)-3.

59. Cast, FTC Informal Staff Opinion Letter, Oct. 27, 1997.

60. LeBlanc, FTC Informal Staff Opinion Letter, June 9, 1998.

61. 1990 comment 603(f)-7.

62. 1990 comment 603(f)-11; 1973 Commission Interpretation #6.

63. Copple, FTC Informal Staff Opinion Letter, June 10, 1998; Pickett, FTC Informal Staff Opinion Letter, July 

10, 1998.

64. Goeke, FTC Informal Staff Opinion Letter, June 9, 1998.

65. 1990 comment 603(f)-5.

66. 1990 comment 603(g)-1.

67. 1990 comment 603(g)-2.

68. Cohan, FTC Informal Staff Opinion Letter, Aug. 1, 2000.

69. 1990 comments 603(g)-3 and 603-4.

70. 1990 comment 603(h)-1.

71. See Hoke v. Retail Credit Corp., 521 F.2d 1079, 1082 (4th Cir. 1975), cert. denied, 423 U.S. 1087 (1976). 

72. Allison, FTC Informal Staff Opinion Letter, Feb. 23, 1998.

73. Solomon, FTC Informal Staff Opinion Letter, Oct. 27, 1998.

74. See Hoke, 521 F.2d at 1082; see also Allison, FTC Informal Staff Opinion Letter, Feb. 23, 1998; Solomon, 

FTC Informal Staff Opinion Letter, Oct. 27, 1998.

75. 1990 comment 603(h)-2G.

76. Latour, FTC Informal Staff Opinion Letter, June 28, 2001.

77. Latour, FTC Informal Staff Opinion Letter, June 28, 2001.

78. Stinneford, FTC Informal Staff Opinion Letter, July 14, 2000.
102

40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

79. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999.

80. Schieber, FTC Informal Staff Opinion Letter, March 3, 1998; Hall, FTC Informal Staff Opinion Letter, Oct. 

26, 1998. 

81. Vail, FTC Informal Staff Opinion Letter, April 5, 1999.

82. Greathouse FTC Informal Staff Opinion Letter, Oct. 20, 1998.

83. Spritz, FTC Informal Staff Opinion Letter, Nov. 5, 1998.

84. Everson, FTC Informal Staff Opinion Letter, July 28, 1998.

85. See Cole v. U.S. Capital, Inc., 389 F.3d 719 (7th Cir. 2004); Murray v. New Cingular Wireless, 523 F.3d 719 

(7th Cir. 2008).

86. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999.

87. Basting, FTC Informal Staff Opinion Letter, June 11, 1998.

88. Basting, FTC Informal Staff Opinion Letter, June 11, 1998.

89. Cohan, FTC Informal Staff Opinion Letter, June 29, 1999.

90. Sections 603(x) and (y) are redesignated sections 603(w) and (x), respectively, effective July 21, 2011. See 

Public Law 111-203, §1088(a)(1)(A). 

91. 1990 comment 604-1.

92. 1990 comment 604-2A.

93. 1990 comment 604-2A.

94. 1990 comment 604-2B.

95. 1990 comment 604G-1.

96. 1990 comment 604(2)-2.

97. 1990 comment 604(3)(E)-6A.

98. 1990 comment 604(3)(E)-6B.

99. 1990 comment 604(3)(E)-6C.

100. 1990 comment 604(3)(E)-6D.

101. 1990 comment 604(3)(E)-6E.

102. 1990 comment 604(3)(E)-5.

103. Shibley, FTC Informal Staff Opinion Letter, June 8, 1999.

104. 1990 comment 604(3)(E)-4.

105. 1990 comment 604G-2.

106. 1990 comment 604G-3. 

107. 1990 comment 604(1)-1.

108. 1990 comment 604(1)-2.

109. 1990 comment 604(2)-1.

110. Shibley, FTC Informal Staff Opinion Letter, June 8, 1999.

111. Landever, FTC Informal Staff Opinion Letter, Oct. 12, 1999.

112. Zalenski, FTC Informal Staff Opinion Letter, May 24, 2001.

113. Landever, FTC Informal Staff Opinion Letter, Oct. 12, 1999.

114. 1990 comment 604(3)(A)-7.

115. 1990 comment 604(3)(E)-6B.

116. 1990 comment 604(3)(A)-5A.

117. 1990 comment 604(3)(A)-5B.

118. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999.

119. 1990 comment 604(3)(A)-1A.

120. 1990 comment 604(3)(E)-6E.

121. 1990 comment 604(3)(A)-9.
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122. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999; Benner, FTC Informal Staff Opinion Letter, 

April 30, 1999.

123. Benner, FTC Informal Staff Opinion Letter, April 30, 1999. 

124. 1990 comment 604(3)(A)-1B.

125. Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998.

126. 1990 comment 604(3)(A)-4.

127. Tatelbaum 1, FTC Informal Staff Opinion Letter, July 26, 2000; Tatelbaum 2, FTC Informal Staff Opinion 

Letter, June 22, 2001.

128. 1990 comment 604(3)(B)-1.

129. 1990 comment 604(3)(B)-3.

130. 1990 comment 604(3)(C)-1.

131. Ball, FTC Informal Staff Opinion Letter, March 1, 2000.

132. 1990 comment 604(3)(C)-2; Greathouse, FTC Informal Staff Opinion Letter, Oct. 29, 1998.

133. 1990 comment 604(3)(D)-1.

134. 1990 comment 604(3)(D)-3.

135. Greathouse, FTC Informal Staff Opinion Letter, Oct. 29, 1998.

136. 1990 comment 604(3)(D)-2.

137. 1990 comment 604(3)(E)-1.

138. 1990 comment 604(3)(E)-2.

139. 1990 comment 604(3)(E)-3.

140. Greenblatt, FTC Informal Staff Opinion Letter, Oct. 27, 1998.

141. Kaiser, FTC Informal Staff Opinion Letter, July 16, 1998; Coffey, FTC Informal Staff Opinion Letter, Feb. 

11, 1998. 

142. 1990 comment 604(3)(E)-4.

143. 1990 comment 604(3)(E)-4.

144. 1990 comment 604(3)(E)-4.

145. Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998. 

146. Kaiser, FTC Informal Staff Opinion Letter, July 16, 1998; Coffey, FTC Informal Staff Opinion Letter, Feb. 

11, 1998.

147. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999.

148. Gowen, FTC Informal Staff Opinion Letter, April 29, 1999; Benner, FTC Informal Staff Opinion Letter, 

April 30, 1999.

149. Baughn, FTC Informal Staff Opinion Letter, April 30, 1999.

150. Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998; Slyter, FTC Informal Staff Opinion Letter, 

June 12, 1998.

151. Pickett, FTC Informal Staff Opinion Letter, July 10, 1998.

152. Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998.

153. Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

154. Slyter, FTC Informal Staff Opinion Letter, June 12, 1998.

155. Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998.

156. Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998.

157. Steer, FTC Informal Staff Opinion Letter, Oct. 21, 1997; Solganik, FTC Informal Staff Opinion Letter, Oct. 

23, 1997; Hauxwell, FTC Informal Staff Opinion Letter, June 12, 1998.

158. Hauxwell, FTC Informal Staff Opinion Letter, June 12, 1998.

159. Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

160. Willner, FTC Informal Staff Opinion Letter, March 25, 1999.

161. Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997; Leathers, FTC Informal Staff Opinion Letter, 
104

40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

Sept. 9, 1998; Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998.

162. Brisch, FTC Informal Staff Opinion Letter, June 11, 1998; James, FTC Informal Staff Opinion Letter, Aug. 

6, 1998; Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

163. Brisch, FTC Informal Staff Opinion Letter, June 11, 1998; Slyter, FTC Informal Staff Opinion Letter, June 

12, 1998.

164. James, FTC Informal Staff Opinion Letter, Aug. 6, 1998. 

165. Fischel, FTC Informal Staff Opinion Letter, Oct. 1, 1999.

166. Solganik, FTC Informal Staff Opinion Letter, Oct. 23, 1997.

167. Weisberg, FTC Informal Staff Opinion Letter, June 27, 1997; Solganik, FTC Informal Staff Opinion Letter, 

Oct. 23, 1997; Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

168. Weisberg, FTC Informal Staff Opinion Letter, June 27, 1997; Hawkey, FTC Informal Staff Opinion Letter, 

Dec. 18, 1997; Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998; Lewis, FTC Informal Staff 

Opinion Letter, June 11, 1998.

169. Rosen, FTC Informal Staff Opinion Letter, June 9, 1998.

170. Hahn, FTC Informal Staff Opinion Letter, July 8, 1998; Hinkle, FTC Informal Staff Opinion Letter, July 9, 

1998; Willner, FTC Informal Staff Opinion Letter, March 25, 1999; Vail, FTC Informal Staff Opinion 

Letter, April 5, 1999. 

171. Hahn, FTC Informal Staff Opinion Letter, July 8, 1998; Meisinger, FTC Informal Staff Opinion Letter, Aug. 

31, 1999.

172. Leathers, FTC Informal Staff Opinion Letter, Sept. 9, 1998.

173. Coffey, FTC Informal Staff Opinion Letter, Feb. 11, 1998.

174. Rosen, FTC Informal Staff Opinion Letter, June 9, 1998.

175. Rosen, FTC Informal Staff Opinion Letter, June 9, 1998.

176. 1990 comments 605-1 and 605-2.

177. 1990 comment 605-6.

178. 1990 comment 605-4.

179. 1990 comment 605-5.

180. 1990 comment 605-7.

181. Seham, FTC Informal Staff Opinion Letter, April 17, 1998; Nadell, FTC Informal Staff Opinion Letter, Dec. 

10, 1998.

182. 1990 comment 605-3.

183. 1990 comment 605(a)(1)-1.

184. 1990 comment 605(a)(1)-3.

185. Anonymous, FTC Informal Staff Opinion Letter, Nov. 5, 1999.

186. 1990 comment 605(a)(2)-1.

187. 1990 comment 605(a)(2)-2.

188. 1990 comment 605(a)(3)-1.

189. 1990 comment 605(a)(4)-1.

190. 1990 comment 605(a)(4)-2.

191. 1990 comment 605(a)(6)-1.

192. 1990 comment 605(a)(6)-2.

193. Nadell, FTC Informal Staff Opinion Letter, Dec. 10, 1998.

194. 1990 comment 605(a)(5)-2.

195. Halpern, FTC Informal Staff Opinion Letter, June 11, 1998.

196. Johnson, FTC Informal Staff Opinion Letter, Aug. 31, 1998.

197. Johnson, FTC Informal Staff Opinion Letter, Aug. 31, 1998.

198. Kosmerl, FTC Informal Staff Opinion Letter, June 4, 1999; Amason, FTC Informal Staff Opinion Letter, 
105

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Feb. 15, 2000.

199. Amason, FTC Informal Staff Opinion Letter, Feb. 15, 2000.

200. Amason, FTC Informal Staff Opinion Letter, Feb. 15, 2000.

201. 1990 comment 606-1.

202. Willner, FTC Informal Staff Opinion Letter, March 25, 1999.

203. 1990 comment 606-2.

204. Pickett, FTC Informal Staff Opinion Letter, July 10, 1998.

205. Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

206. 1990 comment 606-5; Brisch, FTC Informal Staff Opinion Letter, June 11, 1998; James, FTC Informal Staff 

Opinion Letter, Aug. 6, 1998; Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

207. 1990 comment 606-6.

208. 1990 comment 606-7.

209. Willner, FTC Informal Staff Opinion Letter, March 25, 1999.

210. 1990 comment 607-1A.

211. 1990 comment 607-1B.

212. 1990 comment 607-2A; see United States v. ChoicePoint, Inc., No. 1:06cv198 (N.D. Ga. 2006); United 

States v. Rental Research Services, Inc., No. 0:09-cv-00524 (D. Minn. 2009) .

213. 1990 comment 607-2B.

214. 1990 comment 607-2C.

215. 1990 comment 607-2D.

216. 1990 comment 607-2E; see Settlement One Credit Corp., ACRAnet, Inc., and Fajilan and Associates, Inc., 

76 Fed. Reg. 7213 (2011) (proposed consent orders).

217. 1990 comment 607-2G.

218. Landever, FTC Informal Staff Opinion Letter, Oct. 12, 1999.

219. Watkins, FTC Informal Staff Opinion Letter, June 24, 1999.

220. 1990 comments 607-3A and 607-3D.

221. 1990 comment 607-6.

222. 1990 comment 607-7.

223. 1990 comment 607-3F/2.

224. 1990 comment 607-3F/1.

225. Harris, FTC Informal Staff Opinion Letter, March 22, 1999.

226. 1990 comment 607-3F/3.

227. 1990 comments 607-3F/2 and 607-F/6.

228. Lovern, FTC Informal Staff Opinion Letter, April 24, 1998.

229. McCorkell, FTC Informal Staff Opinion Letter, June 3, 1999.

230. 1990 comment 607-3C.

231. See United States v. TALX Corp., No. 4:09-CV-01071 (E.D. Mo. July 9, 2009). 

232. Beaudette, FTC Informal Staff Opinion Letter, June 9, 1998.

233. 1990 comment 608-1.

234. 1990 comment 608-2.

235. 1990 comment 609-1.

236. 1990 comment 609-4.

237. Cohan, FTC Informal Staff Opinion Letter, Aug. 1, 2000.

238. Lee, FTC Informal Staff Opinion Letter, June 28, 1998.

239. 1990 comment 609-7.

240. 1990 comment 609-9.
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40 YEARS OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT

241. 1990 comment 609-10.

242. 1990 comment 609-11.

243. Cohan, FTC Informal Staff Opinion Letter, Aug. 1, 2000.

244. Benner, FTC Informal Staff Opinion Letter, April 30, 1999.

245. 1990 comment 609-10.

246. United States v. Equifax Credit Info. Servs., Inc., No. 1:00-CV-0087 (N.D. Ga. Jan. 13, 2000); FTC v. 

Experian Mktg. Solutions, Inc., No. 3-00CV0056-L (N.D. Tex. Jan. 13, 2000); United States v. Trans 

Union LLC, No. 00C 0253 (N.D. Ill. Jan. 13, 2000).

247. Cohan, FTC Informal Staff Opinion Letter, June 29, 1999.

248. 1990 comment 610-2.

249. 1990 comment 610-4.

250. 1990 comment 611-1.

251. 1990 comment 611-2.

252. 1990 comment 611-5.

253. 1990 comments 611-3 and 612-3.

254. 1990 comment 611-4.

255. 1990 comment 611-6.

256. Anonymous, FTC Informal Staff Opinion Letter, Nov. 5, 1999.

257. 1990 comment 611-11.

258. 1990 comment 611-9; see United States v. First Advantage SafeRent, Inc., No. 8:10-cv-0090-PJM (D. Md. 

Jan. 14, 2010).

259. 1990 comments 611-7 and 611-8.

260. 1990 comment 611-13.

261. 1990 comment 611-14.

262. Edwards, FTC Informal Staff Opinion Letter, July 15, 1998.

263. 1990 comment 613-1.

264. Slyter, FTC Informal Staff Opinion Letter, June 12, 1998.

265. 1990 comment 613-2.

266. 1990 comment 613-3.

267. 1990 comment 613-5.

268. 1990 comment 613-4.

269. Allan, FTC Informal Staff Opinion Letter, May 5, 1999.

270. Holland, FTC Informal Staff Opinion Letter, Dec. 16, 1999.

271. Weisberg, FTC Informal Staff Opinion Letter, June 27, 1997; Solganik, FTC Informal Staff Opinion Letter, 

Oct. 23, 1997; Hawkey, FTC Informal Staff Opinion Letter, Dec. 18, 1997.

272. Solganik, FTC Informal Staff Opinion Letter, Oct. 23, 1997.

273. 1990 comment 615-1.

274. 1990 comment 615-1.

275. 1990 comment 615-9.

276. Latour, FTC Informal Staff Opinion Letter, June 28, 2001.

277. Stinneford, FTC Informal Staff Opinion Letter, July 14, 2000.

278. 1990 comment 615-6.

279. Schieber, FTC Informal Staff Opinion Letter, March 3, 1998; Hall, FTC Informal Staff Opinion Letter, Oct. 

26, 1998.

280. Everson, FTC Informal Staff Opinion Letter, July 28, 1998.

281. 1990 comment 615-5.

282. 1990 comment 615-11.
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283. 1990 comment 615-14; Everson, FTC Informal Staff Opinion Letter, July 28, 1998.

284. 1990 comment 615-4.

285. Schieber, FTC Informal Staff Opinion Letter, March 3, 1998.

286. 1990 comment 615-13.

287. Allan, FTC Informal Staff Opinion Letter, Feb. 14, 2000.

288. 1990 comment 615-2.

289. 1990 comment 607-8.

290. Sheffield, FTC Informal Staff Opinion Letter, Nov. 10, 1998.

291. 1990 comment 615-15.

292. 1990 comment 615-16.

293. 1990 comment 615-16.

294. Riddle, FTC Informal Staff Opinion Letter, March 17, 1999.

295. 1990 comment 621-1 and 621-2.

296. Greenblatt, FTC Informal Staff Opinion Letter, Oct. 27, 1998.

297. Harris, FTC Informal Staff Opinion Letter, March 22, 1999.

298. Harvey, FTC Informal Staff Opinion Letter, Dec. 23, 1997.

299. Harvey, FTC Informal Staff Opinion Letter, Dec. 23, 1997.

300. Johnson, FTC Informal Staff Opinion Letter, Aug. 31, 1998; Kosmerl, FTC Informal Staff Opinion Letter, 

June 4, 1999.

301. Gillespie, FTC Informal Staff Opinion Letter, March 10, 1998.

302. Amason, FTC Informal Staff Opinion Letter, Feb. 15, 2000.

303. Gillespie, FTC Informal Staff Opinion Letter, March 10, 1998.

304. Cohan, FTC Informal Staff Opinion Letter, Aug. 1, 2000; Tabler, FTC Informal Staff Opinion Letter, Oct. 

27, 1998.

305. Cohan, FTC Informal Staff Opinion Letter, Aug. 1, 2000.
108

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LIST OF FTC FCRA CASES

 1.Credit Bureau of Lorain, Inc. et al.1 81 F.T.C. 381 (1972)

 2. Credit Bureau of Columbus, Inc., et al. 81 F.T.C. 938 (1972)

 3. Credit Bureau of Greater Syracuse, Inc., et al . 84 F.T.C. 1660 (1974)

 4. National Credit Exchange, Inc. t/a Robert N. Barnes 85 F.T.C. 520 (1975) 

(d/b/a/ National Fraudulent Check Bureau)

 5. Filmdex Chex System, Incorporated, et al. 85 F.T.C. 889 (1975)

 6. Credit Data Northwest, et al. 86 F.T.C. 389 (1975)

 7. Checkmate Inquiry Service, Inc. et al. 86 F.T.C. 681 (1975)

 8. American Express Company 87 F.T.C. 1293 (1976)

 9. Interstate Check Systems, Inc. et al. 88 F.T.C. 984 (1976)

10. Alexander’s, Inc. 89 F.T.C. 531 (1977)

11. American Service Bureau, Inc. 92 F.T.C. 330 (1978)

12. Moore & Associates, Inc. et al. (d/b/a Uni-Check, etc) 92 F.T.C. 440 (1978)

13. Credit Bureau Associates 92 F.T.C. 837 (1978)

14. Aldens, Inc. 92 F.T.C. 901 (1978)

15. Howard Enterprises, Inc. et al. 93 F.T.C. 909 (1979)

16. Westinghouse Credit Corp. 94 F.T.C. 1280 (1979)

17. Equifax, Inc. [Retail Credit Company] 96 F.T.C. 844 (1980)2

18. Southern Maryland Credit Bureau, Inc. 101 F.T.C. 19 (1983)

19. MIB, Inc., d/b/a Medical Information Bureau 101 F.T.C. 415 (1983)

20. Trans Union Credit Information Company (omnibus) 102 F.T.C. 1109 (1983)

21. Hospital & Health Services Credit Union 104 F.T.C. 589 (1984)

22. U.S. v. Allied Finance Corp. Civ. No. 85-1933 (N.D. Tex.1985)

23. Associated Dry Goods Corporation 105 F.T.C. 310 (1985) 

24. Wright-Patt Credit Union, Inc. 106 F.T.C. 354 (1985)

25. Federated Department Stores, Inc. 106 F.T.C. 615 (1985)

26. U.S. v. Winkleman Stores, Inc. Civ. No. 85-2214 (N.D. Ohio 1985)

27. U S. v. Strawbridge & Clothier, Inc. Civ. No. 85-6855 (E.D. Pa. 1985)

28. U.S. v. Norwest, Inc. Civ. No. 87-6025 (C.D. Cal. 1987)

29. U.S. v. Green Tree Acceptance, Inc. Civ. No. 86-0469 (M.D. Tex.1988)

30. U.S. v. City Finance Corp., et al. Civ. No. 90-0246 (N.D. Ga. 1990)

31. U.S. v. Tower Loan of Mississippi Civ. No. 90-0447 (S.D. Miss. 1991)

32. U.S. v. Barclay American Corp. Civ. No. 91-0014 (W.D.N.C. 1991)

33. U.S. v. American International Acceptance Corp, et al. Civ. No. 91-2738 (N.D. Ga. 1990)

34. Electronic Data Systems Corporation 114 F.T.C. 524 (1991)

35. Kobacker Company 115 F.T.C. 13 (1992)

36. Keystone Carbon Company 115 F.T.C. 22 (1992)

37. McDonnell Douglas Corporation 115 F.T.C. 33 (1992)

38. Macy’s Northeast, Inc., et al. 115 F.T.C. 43 (1992)

39. Marshall-Field & Company 116 F.T.C. 777 (1993)

1. Cases published in F.T.C. Reports are recorded in the same style on this list as in the printed volume.

2. Reversed in part, Equifax, Inc. v. FTC, 678 F.2d 1047 (11th Cir. 1982), modified, 100 F.T.C. 514 (1982). 
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40. F.T.C. v. TRW Inc. (mixed files) 784 F. Supp. 361 (N.D. Tex. 1991) 

 F.T.C. v. TRW Inc. (state omnibus, FTC “me too”) Civ. No. 3-91-2661 (N.D. Tex. 1993)

41. Trans Union Corp.3 (prescreening procedures) 116 F.T.C. 1334 (1993)

 (target marketing) 118 F.T.C. 821 (1994)4

42. I.R.S.C., Inc., et al. 116 F.T.C. 266 (1993)

43. CDB Infotek, et al. 116 F.T.C. 280 (1993)

44. Inter-Fact, Inc., et al. 116 F.T.C. 294 (1993)

45. W.D.I.A. Corporation, et al. 117 F.T.C. 757 (1994)

46. Equifax Credit Information Services, Inc. (omnibus) 120 F.T.C. 577 (1995) 

47. Bruno’s, Inc. 124 F.T.C. 126 (1997)

48. U.S. v. Bonlar Loan Co., Inc. Civ. No. 97-7274 (N.D. Ill. 1997)

49. Aldi, Inc. 124 F.T.C. 207 (1997)

50. Altmeyer Home Stores, Inc. 125 F.T.C. 1295 (1998) 

51. First American Real Estate Solutions, LLC 127 F.T.C. 85 (1999)

52. U.S. v. Unicor Funding, Inc. Civ. No. 99-1228 (C.D. Cal. 1999)

53. U.S. v. Franklin Acceptance Corp. Civ. No. 99-2435 (E.D .Pa. 1999)

54. U.S. v. Equifax (“busy signal”) Civ. No. 00-0087 (N.D. Ga. 2000)

55. U.S. v. Experian (“busy signal”) Civ. No. 00-0056 (N.D. Tex. 2000)

56. U.S. v. TransUnion (“busy signal”) Civ. No. 00-0235 (N.D. Ill. 2000)

57. U.S. v. Action Loan Company, Inc. Civ. No. 00-0511 (W.D. Ky. 2000)

58. U.S. v. Performance Capital Management, Inc. Civ. No. 01-1047 (C.D. Cal. 2001)

59. U.S. v. DC Credit Services, Inc. Civ. No. 02-5115 (C.D. Cal. 2002)

60. U.S. v. Citigroup, Inc. [The Associates] Civ. No. 01-0606 (N.D. Ga. 2003)

61. U.S. v. Fairbanks Capital Corp., et al Civ. No. 03-12119 (D. Mass. 2003)

62. Quicken Loans, Inc. 135 F.T.C. 424 (2003)

63. U.S. v. Equifax5 Civ. No. 00-0087 (N.D. Ga. 2003)

64. U.S. v. NCO Group, Inc. Civ. No. 04-2041 (E.D. Pa. 2004)

65. U.S. v. Imperial Palace, Inc. Civ. No. 04-0963 (D. Nev. 2004)

66. U.S. v. AT&T Corp. Civ. No. 04-4411 (D.N.J. 2004)

67. U.S. v. Sprint Corp. Civ. No. 04-0361 (N.D. Fla. 2004)

68. U.S. v. Far West Credit, Inc. Civ. No. 06-0041 (D. Utah 2006)

69. U.S. v. ChoicePoint, Inc. Civ. No. 06-0198 (N.D. Ga. 2006)

70. U.S. v. American United Mortgage Co. Civ. No. 07-7064 (N.D. Ill. 2007)

71. FTC v. Navone Civ. No. 08-1842 (D. Nev. 2008)6

72. Milliman, Inc. Docket No. C-4213 (02/06/2008) 

73. Ingenix, Inc. Docket No. C-4214 (02/06/2008)

74. FTC v. EMC Mortgage Corp. Civ. No. 08-0338 (E.D. Tex. 2008) 

3. Consent settlement of prescreening issues only in 1992 target marketing complaint

4. Reversed in part and affirmed in part, Trans Union Corp. v. FTC, 81 F.3d 228 (D.C. Cir. 1996); modified, 

129 F.T.C. 362 (2000), aff’d, Trans Union Corp. v. FTC, 245 F.3d 809, reh. denied, 267 F.3d 1138 (D.C. Cir. 

2001), cert. denied, 536 U.S. 915 (2002) 

5. The 2003 enforcement case charged Equifax with violating the 2000 order. The 2003 settlement modi-fied the 

2000 order, and assessed Equifax $250,000 disgorgement for its violation of that order.

6. Complaint filed on December 30, 2008. Consent order entered on December 29, 2009. 
110

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75. U.S. v. Rental Research Services, Inc. Civ. No. 09-0524 (D. Minn. 2009)

76. U.S. v. TALX Corp. Civ. No. 09-1071 (E.D. Mo. 2009) 

77. U.S. v. Rail Terminal Services, LLC Civ. No. 09-1111 (W.D. Wash. 2009)

78. U.S. v. Quality Terminal Services, LLC Civ. No. 09-1853 (D. Colo. 2009)

79. U.S. v. Metropolitan Home Mortgage, Inc. Civ. No. 09-0936 (C.D. Cal. 2009) 

80. U.S. v. First Advantage SafeRent, Inc. Civ. No. 10-0090 (D. Md. 2010)

81. U.S. v. Credit Bureau Collection Services Civ. No. 10-0169 (S.D. Ohio 2010)

82. U.S. v. Direct Marketing Associates Corp. Civ. No. 10-0696 (D. Ariz. 2010)

83. U.S. v. Central Credit, LLC Civ. No. 10-0565 (D. Nev. 2010)

84. U.S. v. Teletrack Civ. No. 11-2060 (N.D. Ga. 2011)

85. Settlement One Credit Corp. Docket No. C-43xx (0-/--/2011)

86. ACRAnet, Inc. Docket No. C-43xy (0-/--/2011)

87. Fajilan and Associates, Inc. Docket No. C-43xz (0-/--/2011)