2020Credit ReportsFCRA
Fair Credit Reporting Act (FCRA)

Written By ESR News Blog Editor Thomas Ahearn

On June 29, 2020, the United States House of Representatives passed the “Protecting Your Credit Score Act” (H.R. 5332) that would amend the federal Fair Credit Reporting Act (FCRA) to ensure, among other purposes, that consumer reporting agencies (CRAs) are providing fair and accurate information reporting in consumer reports.

Sponsored by Congressman Josh Gottheimer (D-NJ-5), the “Protecting Your Credit Score Act” would repair and strengthen the credit reporting system to better protect and inform consumers while increasing consumer data protection guidelines that the “Big 3” nationwide CRAs – Equifax, Experian, and TransUnion – must follow.

The “Protecting Your Credit Score Act” would make commonsense changes to enhance rights of consumers, create more transparency over consumer reporting and credit scoring processes, and increase accountability of CRAs, furnishers, and companies that develop credit scoring models, according to a summary of the bill.

In 2019, the House Financial Services Committee held a hearing that found the credit reporting system to be fundamentally broken. Consumer complaints regarding problems with their credit reports are consistently submitted to the Consumer Financial Protection Bureau (CFPB) consumer complaint database. H.R. 5332 would:

  • Mandate that all CRAs create a single online consumer portal that gives consumers free and unlimited access to their consumer reports and credit scores.
  • Provide consumers with the ability to initiate disputes about report accuracy, and to place or remove a security freeze.
  • Require the Big 3 CRAs to conduct preventative audits by matching all digits of a social security number or the full legal name, date of birth, current address, and one previous address to the correct consumer to increase consumer report accuracy.
  • Require the Big 3 to disclose the identity and contact information of anyone that has accessed the credit file information of consumers upon the request of a consumer.
  • Establish a CFPB ombudsperson to resolve common errors made by CRAs, and make referrals for supervisory and enforcement actions against non-compliant CRAs.

“Today, the House passed my bipartisan bill to give Americans the tools they need to strengthen and protect what they spend a lifetime building: their credit,” Congressman Gottheimer, a member of the House Financial Services Committee, stated in a news release about the bill, which now moves on to the U.S. Senate for review.

In 2012, the Federal Trade Commission (FTC) – a government agency that protects consumers – conducted a study and found that 21% of consumers had verified errors in their credit reports, 13% had errors that affected their credit scores, and 5% had errors serious enough to cause them to be denied, or to pay more for, credit.

Enacted by Congress in 1970, the FCRA promotes the accuracy, fairness, and privacy of consumer information contained in the files of CRAs, protects consumers from the willful and/or negligent inclusion of inaccurate information in their credit reports, and regulates the collection, dissemination, and use of consumer information.

The CFPB enforces the FCRA that governs background checks in the United States. Employment Screening Resources® (ESR) is a leading global background check provider that offers background screening services that comply with the CFPB and the FCRA. To learn more about ESR, visit www.esrcheck.com.

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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