CFPB Announces Ceiling on Charges for FCRA Disclosures Increased in 2019

CFPB Announces Ceiling on Charges for FCRA Disclosures Increased in 2019

Written By ESR News Blog Editor Thomas Ahearn

On December 31, 2018, the Consumer Financial Protection Bureau (CFPB) – the agency responsible for consumer protection in the financial sector – announced the ceiling on allowable charges for disclosures under the federal Fair Credit Reporting Act (FCRA) had increased from $12.00 to $12.50, effective for 2019.

CFPB Announces Charges for FCRA Disclosures Increased

Section 612(f)(1)(A) of the FCRA – a federal law that governs background checks for employment purposes in America – provides that a consumer reporting agency (CRA) may charge a consumer a reasonable amount for making a disclosure to the consumer pursuant to section 609 of the FCRA.

FCRA Section 612(f)(1)(A) further provides that, where a CRA is permitted to impose a reasonable charge on a consumer for making a disclosure to the consumer pursuant to section 609 of the FCRA, the charge shall not exceed $8.00 and shall be indicated to the consumer before making the disclosure.

FCRA Section 612(f)(2) states the CFPB shall increase the $8.00 maximum amount on January 1 of each year based on changes in the Consumer Price Index (CPI), with fractional changes rounded to the nearest fifty cents. CFPB calculations are based on the CPI-U, which covers all urban consumers.

The CFPB was established by the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act and opened in 2011. Former Acting CFPB Director Mick Mulvaney took over in 2017 began calling the CFPB the Bureau of Consumer Financial Protection or BCFP, reflecting the name codified in the Dodd-Frank Act.

The planned rebranding proposal that would change the name of the CFPB to the Bureau of Consumer Financial Protection (BCFP) could cost banks, lenders, and financial services firms subject to BCFP supervision more than $300 million, according to a report from The Hill based on “an internal agency analysis.”

In September of 2018, the CFPB updated two model FCRA disclosures to reflect changes made when Congress passed the Economic Growth, Regulatory Relief, and Consumer Protection Act in May of 2018 requiring nationwide consumer reporting agencies to provide “national security freezes” free of charge.

The Act mandates that a notice regarding the security freeze right must be included when the FCRA requires that a consumer receive a Summary of Consumer Rights Under the FCRA to obtain and dispute information in consumer reports or a Summary of Consumer Identity Theft Rights.

More Information about CFPB from ESR

Employment Screening Resources® (ESR) – a global background check firm – provides information about the CFPB, which took over the administering of required FCRA notices from the Federal Trade Commission (FTC) in 2013. To read more about the CFPB, visit www.esrcheck.com/wordpress/tag/cfpb/.

NOTE: Employment Screening Resources® (ESR) does not provide or offer legal services or legal advice of any kind or nature. Any information on this website is for educational purposes only.

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