I 
117TH CONGRESS 
1ST SESSION H. R. 4112 
To amend the Fair Credit Reporting Act to establish clear Federal oversight 
of the development of credit scoring models by the Bureau of Consumer 
Financial Protection, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 24, 2021 
Mr. LYNCH introduced the following bill; which was referred to the Committee 
on Financial Services 
A BILL 
To amend the Fair Credit Reporting Act to establish clear 
Federal oversight of the development of credit scoring 
models by the Bureau of Consumer Financial Protection, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Clarity in Credit Score 
Formation Act of 2021’’. 
SEC. 2. FINDINGS. 
Congress finds the following: 
VerDate Sep 11 2014 
03:43 Jul 10, 2021
Jkt 019200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H4112.IH
H4112
kjohnson on DSK79L0C42PROD with BILLS
(1) The February 2015 report of the Bureau of 
Consumer Financial Protection titled ‘‘Consumer 
Voices on Credit Reports and Scores’’ found that 
some consumers are reluctant to comparison shop 
for loans and other types of consumer credit prod-
ucts out of fear that they will lower their credit 
scores by doing so. 
(2) The Bureau of Consumer Financial Protec-
tion found that one of the most common barriers for 
people in reviewing their own credit reports and 
shopping for the best credit terms was a lack of un-
derstanding of the differences between ‘‘soft’’ and 
‘‘hard’’ inquiries and whether requesting a copy of 
their own report would adversely impact their credit 
standing. 
(3) The Bureau of Consumer Financial Protec-
tion revealed that consumers with accurate percep-
tions of their creditworthiness may be better 
equipped to shop for favorable credit terms. 
SEC. 3. CONSUMER BUREAU OVERSIGHT OF CREDIT SCOR-
ING MODELS. 
The Fair Credit Reporting Act (15 U.S.C. 1681 et 
seq.) is amended— 
(1) by adding at the end the following new sec-
tion: 
VerDate Sep 11 2014 
03:43 Jul 10, 2021
Jkt 019200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H4112.IH
H4112
kjohnson on DSK79L0C42PROD with BILLS
‘‘§ 630. Credit scoring models 
‘‘(a) VALIDATED CREDIT SCORING MODELS.—Not 
later than 1 year after the date of the enactment of this 
section, the Bureau shall (in consultation with the Board 
of Governors of the Federal Reserve System, the Comp-
troller of the Currency, the Board of Directors of the Fed-
eral Deposit Insurance Corporation, and the National 
Credit Union Administration Board) issue final regula-
tions applicable to any person that creates, maintains, uti-
lizes, or purchases credit scoring models used in making 
credit decisions to establish standards for validating the 
accuracy and predictive value of all such credit scoring 
models, both before release for initial use and at regular 
intervals thereafter, for as long as such credit scoring 
models are made available for purchase or use by such 
person. 
‘‘(b) PROHIBITION.—At least once every 2 years, the 
Bureau shall conduct a review of credit scoring models to 
determine whether the use of any particular factors, or 
the weight or consideration given to certain factors by 
credit scoring models, is inappropriate, including if such 
factors do not enhance or contribute to the accuracy and 
predictive value of the models. Upon the conclusion of its 
review, the Bureau may prohibit a person described in 
subsection (a) from weighing, considering, or including 
certain factors in, or making available for purchase or use, 
VerDate Sep 11 2014 
03:43 Jul 10, 2021
Jkt 019200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H4112.IH
H4112
kjohnson on DSK79L0C42PROD with BILLS