Consumer Credit Reporting Act?
The Consumer Credit Reporting Act and its various amendments were created to give the consumer protection from the inappropriate conduct rampant amongst credit reporting agencies. It was written to force credit reporting agencies to listen to your complaints and perform specific steps to correct any inaccuracies. Without this law, your complaints were often ignored.
A copy of the main body of the Consumer Credit Reporting Act as it relates to credit repair is presented below. It is included so you know exactly how the law is written. Following this section is a more readable point by point description of your rights under the law:
TITLE VI – CONSUMER CREDIT REPORTING
Section 601. Short title
This title may be cited as the Fair Credit Reporting Act
Section 602. Findings and purpose
(a) The Congress makes the following findings
(1) The banking system is dependent upon fair and accurate credit reporting.
Inaccurate credit reports directly impair the efficiency of the banking system, and
unfair credit reporting methods undermine the public confidence which is essential
to the continued functioning of the banking system.
(2) An elaborate mechanism has been developed for investigating and evaluating
creditworthiness, credit standing, credit capacity, character, and general reputation
of consumers. (3) Consumer reporting agencies have assumed a vital role in
assembling and evaluating consumer credit and other information on consumers.
(4) There is a need to insure that consumer reporting agencies exercise their grave
responsibilities with fairness, impartiality, and a respect for a consumer’s right to
privacy. (b) It is the purpose of this title to require that consumer reporting
agencies adopt reasonable procedures for meeting the needs of commerce for
consumer credit, personnel, insurance, and other information in a manner which
is fair and equitable to the consumer, with regard to the confidentiality, accuracy,
relevancy, and proper utilization of such information in accordance with the
requirements of this title.
Section 603. Definitions and rules of construction
(a) Definitions and rules of construction set forth in this section are applicable for
the purposes of this title
(b) The term ‘person’ means any individual, partnership, corporation, trust, estate,
cooperative, association, government or governments] subdivision or agency, or
(c) The term ‘consumer’ means an individual.
(d) The term ‘consumer report’ means any written, oral, or other communication
of any information by a consumer reporting agency hewing on a consumer’s
creditworthiness, 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 pan for the purpose of serving as a factor in establishing
the consumer’s eligibility for (1) credit or insurance to be used primarily for
personal, family, or household purposes, or (2) employment purposes, or (3) other
purposes authorized under section 604. The term does not include (A) my report
containing information solely as to transactions or experiences between the
consumer and the person making the report; (B) any authorization or approval of
a specific extension of credit directly or indirectly by the issuer of a credit card or
similar device; or (C) 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 a 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 makes the disclosures to the consumer required under section
615 (e) The term ‘investigative consumer report’ means 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
with neighbors, friends, or associates of the consumer reported on or with others
with whom he is acquainted or who may have knowledge concerning any such
items of information. 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 a consumer reporting agency when such information was
obtained directly from a creditor of the consumer or from the consumer.
(f) The term ‘consumer reporting agency’ means any person which, for monetary
fees, does, 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.
Section 604. Permissible purposes of reports
A consumer reporting agency may furnish a consumer report under the following
circumstances and no other
(I ) In response to the order of a court having jurisdiction to issue such an order.
(2) In accordance with the written instructions of the consumer to whom it relates.
(3) To a person which it has reason to believe–
(A) 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; or
(B) intends to use the information for employment purposes; or
(C) intends to use the information in connection with the underwriting of
insurance involving the consumer; or
(D) 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; or
(E) otherwise has a legitimate business need for the information in connection
with a business transaction involving the consumer.
Section 605. Obsolete information
(a) Except as authorized under subsection (b), no consumer reporting agency may
make any consumer report containing any of the following items of information
( 1) Cases under title II 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
cause may be, antedate, the report by more than 10 years.
(2) Suits and judgments which, 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.
(3) Paid tax liens which, from date of payment, antedate the report by more than
(4) Accounts placed for collection or charged to profit and loss which antedate the
report by more than seven years.
(5) Records of arrest, indictment, or conviction of come, which, from date of
disposition, release, or parole, antedate the report by more than seven years.
(6) Any other adverse item of information which antedates the report by more than
(b) The provisions of subsection (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 $50,000 or more;
(2) the underwriting of life insurance involving, or which may reasonably be
expected to involve, a face amount of $50,000 or more; or (3) the employment of
any individual at an annual salary which equals, or which may reasonably be
expected to equal $20,000, or more.
Section 606. Disclosure of investigative consumer
(a) A person may not procure or cause to be prepared an investigative consumer
report on any consumer unless–
(1 ) it is clearly and accurately disclosed to the consumer than an investigative
consumer report including information as to his character, general reputation,
personal characteristics, and mode of living, whichever are applicable, may be
made, and such disclosure (A) is made in a writing mailed, or otherwise delivered,
to the consumer, not later than three days after the date on which the report was
first requested, and (B) includes a statement informing the consumer of his fight
to request the additional disclosures provided for under subsection (b) of this
(2) the report is to be used for employment purposes for which the Consumer has
no specifically applied.
(b) 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 the receipt by him of the disclosure required by
subsection (a)(1), shall make a complete and accurate disclosure of the nature and
scope of the investigation requested. This disclosure shall be 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.
(c) No person may be held liable for any violation of subsection (a) or (b) of this
section if he shows by a preponderance of the evidence that at the time of the
violation he maintained reasonable procedures to assure compliance with
subsection (a) or (b),
Section 607. Compliance procedures
(a) 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 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 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.
(b) 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.
Section 608. Disclosures to governmental agencies
Notwithstanding the provisions of section 604, a Consumer reporting agency may
furnish identifying information respecting any consumer, limited to his name,
address, former address, places of employment, or former places of employment,
to a governmental agency.
Section 609. Disclosures to consumers
(a) Every consumer reporting agency shall, upon request and proper identification
of any consumer, clearly and accurately disclose to the consumer
(1) The nature and substance of all information (except medical information in its
files on the consumer at the time of the request.
(2) The 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 he disclosed: Provided, That in the event an
action is brought under this title, such sources shall be available to the plaintiff
under appropriate discovery procedures in the coot( in which the action is brought.
(3) The recipients of my consumer report on the consumer which it has furnished
(A) for employment purposes within a two-year period preceding the request, and
(B) for my other purpose within the six-month period preceding the request.
(b) The requirements of subsection (a) respecting the disclosure of sources if
information and the recipients of consumer reports do not apply to information
received or consumer reports furnished prior to the effective date of this title except
to the extent that the matter involved is contained in the files of the consumer
reporting agency on that date.
Section 610. Conditions of disclosure to consumers
(a) A consumer reporting agency shall make the disclosures required under
section 609 during normal business hours and on reasonable notice.
(b) The disclosures required under section 609 shall be made to the consumer–
(1) in person – if he appears in person and furnishes proper identification; or
(2) by telephone – if he has made a written request, with proper identification, for
telephone disclosure and the toll charge, if any, for the telephone call is prepaid by
or charged directly to the consumer.
(c) Any consumer reporting agency shall provide trained personnel to explain to
the consumer my information furnished to him pursuant to section 609.
(d) The consumer shall be permitted to be accompanied by one other person of his
choosing, who shall furnish reasonable identification. A consumer reporting
agency may require the consumer to furnish a written statement granting
permission to the consumer reporting agency to discuss the consumer’s file in
such person’s presence.
(e) Except as provided in sections 616 and 617, no consumer my bring my action
or proceeding in the nature of defamation, invasion of privacy, or negligence with
respect to the reporting of information against any consumer reporting agency,
any user of information, or any person who furnishes information to a consumer
reporting agency, based on information disclosed pursuant to section 609, 610, or
615, except as to false information furnished with malice or willful intent to injure
Section 611. Procedure in case of disputed accuracy
(a) If the completeness or accuracy of any item of information contained in his file
is disputed by a consumer, and such dispute is directly conveyed to the consumer
reporting agency by the consumer, the consumer reporting agency shall within a
reasonable period of time re investigate and record the current status of that
information unless it has reasonable grounds to believe that the dispute by the
consumer is frivolous or irrelevant. If after such reinvestigation such information
is found to be inaccurate or can no longer be verified, the consumer reporting
agency shall promptly delete such information. The presence of contradictory
information in the consumer’s file does not in and of itself constitute reasonable
grounds for believing the dispute is frivolous or irrelevant.
(b) 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 mom than one hundred words if it provides the
consumer with assistance in writing a clear summary of the dispute.
(c) 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
my subsequent consumer report containing the information in question, clearly
note that it is disputed by the consumer and provide either the consumers statement
or a clear and accurate codification or summary thereof.
(d) Following any deletion of information which is found to be inaccurate or
whose accuracy can no longer be verified or any notation as to disputed
information, the consumer reporting agency shall, at the request of the consumer,
furnish notification that the item has been deleted or the statement. codification or
summary pursuant to subsection (b) or (c) to any person specifically designated by
the consumer who has within two years prior thereto received a consumer report
for employment purposes, or within six months prior thereto received a consumer
report for any other purpose, which contained the deleted or disputed information,
The consumer reporting agency shall clearly and conspicuously disclose to the
consumer his rights to make such a request. Such disclosure shall be made at or
prior to the time the information is deleted or the consumer’s statement regarding
the disputed information is received.
Section 612. Charges for certain disclosures
A consumer reporting agency shall make all disclosures pursuant to section 609
and furnish all consumer reports pursuant to section 61 1 (d) without charge to
the customer if, within thirty days after receipt by such consumer of a notification
pursuant to section 615 or notification from a debt collection agency affiliated with
such consumer reporting agency stating that the consumer’s credit rating may be
or has been adversely affected, the consumer makes a request under section 609 or
611 (d). Otherwise, the consumer reporting agency may impose a reasonable
charge on the consumer for making disclosure to such consumer pursuant to
section 609, the charge for which shall be indicated to the consumer prior to
making disclosure; and for furnishing notifications, statements, summaries, or
codifications to person designated by the consumer pursuant to section 61 1 (d),
the charge for which shall be indicated to the consumer prior to furnishing such
information and shall not exceed the charge that the consumer reporting agency
would impose on each designated recipient for a consumer report except that no
charge may be made for notifying such persons of the deletion of information
which is found to be inaccurate or which can no longer be verified.
Section 613. Public record information for
A consumer reporting agency which furnishes a consumer report for employment
purposes and which for that purpose compiles and reports items of information on
consumers which are matters of public record and are likely to have an adverse
effect upon a consumer’s ability to obtain employment shall–
(1) at the time such public record information is reported to the user of such
consumer report, notify the consumer of the fact that public record information is
being reported by the consumer reporting agency, together with the name and
address of the person to whom such information is being reported; or
(2) maintain strict procedures designed to insure that whenever public record
information which is likely to have an adverse effect on a consumer’s ability to
obtain employment is reported it is complete and up to date. For purposes of this
paragraph, 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 614. Restrictions on investigative consumer
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
(a) Whenever credit or insurance for personal, family, or household purposes, or
employment involving a consumer is denied or the charge for such credit or
insurance is increased either wholly or partly because of information contained in
a consumer report from a consumer reporting agency, the user of the consumer
report shall so advise the consumer against whom such adverse action has been
taken and supply the name and address of the consumer reporting agency making
(b) Whenever credit for personal, family, or household purposes involving a
consumer is denied or the charge for such credit is increased wither wholly or
partly because of information obtained from a person other than a consumer
reporting agency bearing upon the consumer’s credit worthiness, credit standing,
credit capacity, character, general reputation, personal characteristics, or mode of
living, the user of such information shall, within a reasonable period of time, upon
the consumer’s written request for the reasons for such adverse action received
within sixty days after learning of such adverse action, disclose the nature of the
information to the consumer. The user of such information shall clearly and
accurately disclose to the consumer his right to make such written request at the
time such adverse action is communicated to the consumer.
(c) No person shall be held liable for any violations of this section if he shows by a
preponderance of the evidence that at the time of the alleged violation, he
maintained reasonable procedures to assure compliance with the provisions of
subsections (a) and (b).
Section 616. Civil liability for willful noncompliance
Any consumer reporting agency or user of information which willfully fails to
comply with any requirement imposed under this title with respect to any consumer
is liable to that consumer in an amount equal to the sum of–
(1) any actual damages sustained by the consumer as a result of the failure;
(2) such amount of punitive damages as the court may allow; and
(3) in the case of any successful action to enforce any liability
under this section, the costs of the action together with reasonable attorneys fees as
determined by the court.
Section 617. Civil liability for negligent
Any consumer reporting agency or user of information which is negligent in
failing to comply with any requirement imposed under this title with respect to my
consumer is liable to that consumer in an amount equal to the sum of–
(] ) any actual damages sustained by the consumer as a result of the failure;
(2)in the case of any successful action to enforce any liability under this section, the
costs of the action together with reasonable attorney’s fees as determined by the
Section 618. Jurisdiction of courts; limitation of
An action to enforce any liability created under this title may be brought in any
appropriate United States district court without regard to the amount in
controversy, or in my other court of competent jurisdiction, within two years from
the date on which the liability arises, except that where a defendant has materially
and willfully misrepresented any information required under this title to be
disclosed to an individual and the information so misrepresented is material to the
establishment of the defendants liability to that individual under this title, the action
may be brought at any time within two years after the discovery by the individual of
Section 619. Obtaining information under false
Any person who knowingly and willfully obtains information on a consumer from
a consumer reporting agency under false pretenses shall be fined not mom than
$5,000 or imprisoned not mom than one year, or both.
Section 620. Unauthorized disclosures by officers or
Any officer or employee of a consumer reporting agency who knowingly and
willfully provides information concerning an individual from the agency’s files to a
person not authorized to receive that information shall be fined not mom than
$5,000 or imprisoned not more than one year, or both.
Your Rights And The Law
Now that you have had a moment to look at the legalese version of your fights, lets
take a look at the rights you are given in plain everyday English.
Basically, the above section of the Consumer Credit Reporting Act and a few other
amendments not included here grant you, the consumer of credit, many rights. I
have broken these fights into 11 different points. They are described below.
Right 1: The right to view your credit report – This portion of the law requires that
the credit reporting agencies supply you with a full report on your credit
transactions at any time you request one. This report will contain every item
recorded in their files about you. It may not include every credit item you have but it
will include every credit item that they have in their files about you. Additionally, the
credit reporting agencies are allowed to charge a reasonable fee for this service if it
is being performed at your sole request. However, if you have recently been rejected
for credit by a creditor, they will by law send you a copy of your credit report for
free if you request it.
Right 2: The right to know who has inquired into your credit rile – The law allows
you to know every bank, credit card company, employer, etc. who has requested a
copy of your credit report. This even includes all the times the credit reporting
agency has pulled your file. Every time the credit reporting agency pulls your credit
report to fix an error or examine some information, this action is recorded. This
son of information is very valuable in doweling fraud. If your credit report has
many inquiries that you don’t recognize, someone is probably trying to commit
fraud using your social security number.
Right 3: The right to request verification of information you believe is incorrect –
This portion of the law allows you to have a negative entry checked multiple times.
This guarantees that every time you tell a credit reporting agency an item is
incorrect, they will investigate that item. Without this portion of the law, they could
refuse to investigate your claims mom than one time whether or not your request
Right 4: The right to insert missing data into your credit rile – Often you will have
credit granted to you that never makes its way into your credit report. This happens
for a variety of reasons. You may have been granted credit at a local department
store which doesn’t report information to a credit reporting agency. Or perhaps
you moved to another part of the country and you have credit information that
didn’t follow you from your old address to your new address. This portion of the
law allows you to report all this good credit information to the credit reporting
agencies and have it entered into your credit report. The following are examples of
the types of information you may want to have added to your credit reports:
- Details on loans, both current and paid off, when you have a good payment
- Credit cards with good payment histories that do not appear on your credit
- Salary increases at your current job or when you switch jobs.
- Any active accounts which have good payment histories that do not appear on
your credit reports.
- Information related to your mortgage, especially if it is not being reported on
your credit report.
- Settlements on any judgments, tax and IRS liens, disputed bills, etc.
Right 5: The right to automatically remove all detrimental information from your
credit report after seven years; 10 years for bankruptcy – This portion of the law
guarantees that past financial indiscretions do not follow you for the rest of your
life. This process is automatic and is handled by the credit reporting agencies. If
you ever find a negative credit item on your credit report over seven yews old (10 for
bankruptcy), a simple letter reminding the credit reporting agency of this law will
get that item instantly removed.
Right 6: The right to place your own personal statement in your credit report –
Some of you will have some negative credit due to an extraordinary event such as
the loss of a job, sickness, divorce, etc. And, after trying to clean it from your credit
report, will find that you were unsuccessful. This portion of the law was written for
you. It allows you to have a written statement of 100 words or less placed in your
credit report. This can be used to explain to future creditors what caused the bad
credit and why it was a one-time occurrence.
Right 7: The guarantee of privacy of the information in your credit report from
anyone other than legitimate members of the credit reporting agency – This portion
of the law states that no one can look at your credit report without your permission.
That is why creditors have you sign a form allowing them to examine your credit
report. The only exception to this rate is the credit reporting agencies. They are
allowed to look at your credit report without your permission only for legitimate
business purposes such as updating the information in your file.
Right 8: The right to have your credit report transferred from one area to another
any time you move – This provision of the law guarantees that your credit history
follows you wherever you go. This allows your hard earned good credit to follow
you all over the United States. Unfortunately, it also means that any bad credit you
have also followed you across the country.
Right 9: The right to use the small claims court system to resolve any disputes with
the credit bureaus about incorrect or inaccurate information in your credit report –
This portion of the law gives you the right to your day in court. If something on
your credit report is inaccurate and you can’t get it repaired through the credit
repair process, you have the right to present your evidence in a court of law to
resolve the dispute. If the court finds in your favor, the item will be corrected. If
not, the item will stay in your credit report.
Right 10: The right to know exactly why you were refused credit – This portion of
the law requires that my creditor who refuses you credit must inform you of exactly
why you were turned down. This request must be made by you to the creditor
within 10 days of your being turned down for credit.
Right 11: The right to remain silent about bad credit information that does not
currently appear in your credit report This prevision of the law simply states that
you do not have to correct my omissions you find in your credit report, whether
positive or negative.
These 11 points pretty much summarize your fights under the Consumer Credit
Reporting Act. Certain points are actively used to repair your credit and others are
used to make sum you are treated fairly by the credit system.