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House FCRA Bill Provisions and Implications

As reported in the July 28 edition of PIA National Newsline, the House Financial Services Committee passed H.R. 2622, the Fair and Accurate Credit Transactions...
August 12, 2003

As reported in the July 28 edition of PIA National Newsline, the House Financial Services Committee passed H.R. 2622, the Fair and Accurate Credit Transactions Act, on Thursday, July 24. While interested parties wait for the Senate to draft legislation (expected to happen during this August recess), it is useful to reflect on the key provisions and implications of the House bill:

  • The bill calls for the reauthorization of seven expiring provisions.
  • Identity theft provisions would create a fraud alert system whereby a consumer who suspects that he or she has been the victim of identity theft could request a fraud alert be placed in his or her file by the credit reporting agency (CRA) and have fraudulent information blocked from his or her credit report.
  • The Federal Trade Commission (FTC) would establish policies and procedures for consumers to follow when contacting CRAs and creditors on issues related to identity theft. This would allow victims to report identity theft to only one CRA and have that information shared with all CRAs and the FTC. Additionally, CRAs would have 30 daysto notify consumers and resolve discrepancies when the address given on an application for credit does not match the onein the credit report.
  • Consumers would be entitled to one free credit report a year. The report would include the consumer's credit score, a summary of how the score was derived and how the consumer might improve the score.

What It Means to Agents: The bill as passed by the Committee does not address PIA's biggest concern, affiliate sharing. PIA would like to see a clearer definition and process that protects ownership of information. Banks routinely share information with their affiliates that is not their "owned data," comprised of their own experiences.

The affiliate sharing provisions are part of the expiring preemptions. House Members elected not to open the expiring provisions to amendment, opting instead for a clean reauthorization and permanent extension of the expiring preemptions. Members were afraid that allowing changes to the expiring preemptions would open the Gramm-Leach-Bliley Act to amendment-something they did not want to do.

Also of concern to PIA is an amendment calling for a study on the effect of credit scores and insurance scoring on the availability of financial products.

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