Topic: Fair Credit Reporting Act (FCRA)
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Are you aware of any state or federal rules or guidance that would prohibit a bank from passing credit repair and credit rescore fees on to the customer?
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From what you have told us, the “credit repair and rescore” vendor offers two types of services. The vendor will (1) file disputes about inaccurate items to consumer reporting agencies and, (2) after a debt is paid, quickly obtain a new credit score (a “rapid rescore”). While we are not aware of any laws that…
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Our bank has received a plethora of disputes about a customer’s credit. All of the disputes were submitted by the same credit repair service. Can we safely ignore these repeated disputes, since they were submitted by a credit repair service?
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Based on the facts in your question, we believe that the bank does not have a duty to conduct an investigation of these disputes. The CFPB’s Regulation V, which implements the Fair Credit Reporting Act (FCRA), expressly provides an exception to the general rule requiring creditors to investigate disputes when the disputes are submitted by…
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How should we report consumer real estate loan payments that have not been paid after the customer has filed for bankruptcy? We have been reporting the loan as “past due” to the credit bureau, is this correct?
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We believe that you should continue to report the loan as delinquent. The Fair Credit Reporting Act imposes a duty on entities that provide information to a consumer reporting agency (a furnisher) to provide accurate and complete information. 15 U.S.C. 1681s-2(a)(1)(A). Unless you have received notice that the debt has been discharged, it remains accurate…
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We have been reporting driver’s license discrepancies as red flags on our annual reports, even if they are resolved after obtaining proof of the customer’s current address. However, one of our sister institutions does not report resolved discrepancies on its annual report. Which is the correct approach?
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We do not believe that the Interagency Guidelines on identity theft “red flags” require that your annual board reports include every instance of a discrepancy between the addresses provided on an account application and the applicant’s driver’s license. Of course, this type of instance would be considered a “red flag” under Supplement A to the…
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We are thinking about offering “second chance” checking accounts in addition to our regular checking account products. The second chance accounts would have lower daily limits for ATM withdrawals and point of sale (POS) purchases, among other changes to our account terms. If we offer a customer a “second chance” checking account, do we need to send an adverse action notice?
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We believe that the Fair Credit Reporting Act (FCRA) would require your institution to provide adverse action notices to customers who apply for a checking account and are rejected, even if your institution offers the customer a “second chance” checking account with reduced limits and other features that differ from your normal checking accounts. The…
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We are interviewing a candidate for employment, and received authorization to examine the candidate’s credit report. Can we ask about collection items that appear on the report?
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We do not see any problems with asking an employment applicant about collections items on the applicant’s credit report. The Fair Credit Reporting Act (FCRA) expressly allows you to obtain a “consumer report” for any “employment purpose,” provided that you follow the disclosure and authorization requirements. 15 USC 1681b(b)(1). (Also, while not applicable here, note…
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Are there any laws or regulations that require us to verify customer address changes (change of address notifications)?
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There are a few legal guideposts that apply to customers’ change of address requests, including general guidance on change of address requests and two regulations that apply only in specific instances, all of which are discussed below. Note that the guidance is not considered mandatory, but the regulations’ requirements are mandatory. Regulatory Guidance on Change…
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Do you see any problems with reporting information on accounts held by minors to credit reporting agencies? Some parents have requested this as a way to build up a child’s credit score.
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We are not aware of any restrictions on reporting accurate credit information about a minor, but we note that there may be some reputational and other risks in reporting negative credit information about a minor. The Fair Credit Reporting Act (FCRA) and Regulation V do not contain any references to minors or to the ages…