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Byogtadmin

Understanding the world of credit, personal finance, and the laws that govern them can often seem daunting. One such law that plays a significant role in protecting consumers is the 15 U.S. Code § 1681, part of the Fair Credit Reporting Act (FCRA). In this blog post, we’ll dive into the specifics of this law, its background, and how it can benefit individuals recovering from a low credit score, particularly those who have gone through debt settlement programs.1https://www.law.cornell.edu/uscode/text/15/1681

The 15 U.S. Code § 1681 is primarily focused on the accuracy and fairness of credit reporting. It highlights the importance of the banking system’s reliance on fair and accurate credit reporting, the role of consumer reporting agencies, and the need for these agencies to exercise their responsibilities with fairness, impartiality, and respect for the consumer’s right to privacy. The law further requires consumer reporting agencies to adopt reasonable procedures for providing information that is fair, equitable, and respects the confidentiality, accuracy, relevancy, and proper utilization of consumer information.2https://www.law.cornell.edu/uscode/text/15/1681

As part of the Consumer Credit Protection Act, the FCRA protects information collected by consumer reporting agencies. This includes credit bureaus, medical information companies, and tenant screening services. Notably, the information in a consumer report cannot be provided to anyone who does not have a purpose specified in the Act. Companies that provide information to consumer reporting agencies have specific legal obligations, including the duty to investigate disputed information.3https://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-credit-reporting-act

15 U.S.C. 1681b, part of the FCRA, is particularly important when it comes to the concept of “permissible purpose”. This means that organizations must have legitimate reasons to pull a consumer’s credit information or background info. For instance, a lender may request your credit info if you apply for a mortgage loan, but your current employer cannot randomly look up your credit score or pull your credit information if they have already hired you. If your credit information is pulled illegally, you have the right to sue for violation of your rights under the FCRA.4https://www.fcra.com/15-u-s-c-1681b-what-it-means-for-you/

The law also defines specific circumstances under which consumer reporting agencies can furnish a consumer report. These include when the report is in response to a court order, when the subject consumer of the report asks for it in writing, when the person requesting the report has a permissible purpose, or when there’s any other legitimate business need for the information. In addition, the law outlines important consumer report disclosure rules, stating that a person or organization can’t procure a consumer report unless they’ve made it clear in writing to the consumer and the consumer has authorized the release in writing.5https://www.fcra.com/15-u-s-c-1681b-what-it-means-for-you/

Citations:

  • 1
    https://www.law.cornell.edu/uscode/text/15/1681
  • 2
    https://www.law.cornell.edu/uscode/text/15/1681
  • 3
    https://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-credit-reporting-act
  • 4
    https://www.fcra.com/15-u-s-c-1681b-what-it-means-for-you/
  • 5
    https://www.fcra.com/15-u-s-c-1681b-what-it-means-for-you/