A
debt collector threatens you with criminal
prosecution or tries to imply your committing a
crime that you could be arrested for and go to
jail.
If the debt collector has violated any of your
rights under the Fair Debt Collection Practices
Act, contact us at Financial Independence &
Resource Education, Inc., to submit copies (not
originals) of all correspondence (including
proof of payment, letters, call logs, etc.) and
we will refer you to the State Attorney
General's Office and to the Federal Trade
Commission who will notify the debt collector
that they are in violation of the FDCPA. The
debt collector may be required to pay you money
in fines and damages.
FAIR
DEBT COLLECTION PRACTICES ACT
15 USC Section 1692
THE FAIR DEBT
COLLECTION PRACTICES ACT
As amended by Public Law 104-208, 110 Stat. 3009
(Sept. 30, 1996)
To amend the Consumer Credit Protection Act to
prohibit abusive practices by debt collectors.
Be it enacted by the Senate and House of
Representatives of the United States of America
in Congress assembled, That the Consumer Credit
Protection Act (15 U.S.C. 1601 et seq.) is
amended by adding at the end thereof the
following new title:
TITLE VIII - DEBT COLLECTION PRACTICES [Fair
Debt Collection Practices Act]
Sec.
801. Short Title
802. Congressional findings and declaration of
purpose
803. Definitions
804. Acquisition of location information
805. Communication in connection with debt
collection
806. Harassment or abuse
807. False or misleading representations
808. Unfair practice
809. Validation of debts
810. Multiple debts
811. Legal actions by debt collectors
812. Furnishing certain deceptive forms
813. Civil liability
814. Administrative enforcement
815. Reports to Congress by the Commission
816. Relation to State laws
817. Exemption for State regulation
818. Effective date
¤ 801. Short Title [15 USC 1601
note]
This title may be cited as the "Fair Debt
Collection Practices Act."
¤ 802. Congressional findings and
declarations of purpose [15 USC 1692]
(a) There is abundant evidence of the use of
abusive, deceptive, and unfair debt collection
practices by many debt collectors. Abusive debt
collection practices contribute to the number of
personal bankruptcies, to marital instability,
to the loss of jobs, and to invasions of
individual privacy.
(b) Existing laws and procedures for redressing
these injuries are inadequate to protect
consumers.
(c) Means other than misrepresentation or other
abusive debt collection practices are available
for the effective collection of debts.
(d) Abusive debt collection practices are
carried on to a substantial extent in interstate
commerce and through means and instrumentalities
of such commerce. Even where abusive debt
collection practices are purely intrastate in
character, they nevertheless directly affect
interstate commerce.
(e) It is the purpose of this title to eliminate
abusive debt collection practices by debt
collectors, to insure that those debt collectors
who refrain from using abusive debt collection
practices are not competitively disadvantaged,
and to promote consistent State action to
protect consumers against debt collection
abuses.
¤ 803. Definitions [15 USC 1692a]
As used in this title --
(1) The term "Commission" means the Federal
Trade Commission.
(2) The term "communication" means the conveying
of information regarding a debt directly or
indirectly to any person through any medium.
(3) The term "consumer" means any natural person
obligated or allegedly obligated to pay any
debt.
(4) The term "creditor" means any person who
offers or extends credit creating a debt or to
whom a debt is owed, but such term does not
include any person to the extent that he
receives an assignment or transfer of a debt in
default solely for the purpose of facilitating
collection of such debt for another.
(5) The term "debt" means any obligation or
alleged obligation of a consumer to pay money
arising out of a transaction in which the money,
property, insurance or services which are the
subject of the transaction are primarily for
personal, family, or household purposes, whether
or not such obligation has been reduced to
judgment.
(6) The term "debt collector" means any person
who uses any instrumentality of interstate
commerce or the mails in any business the
principal purpose of which is the collection of
any debts, or who regularly collects or attempts
to collect, directly or indirectly, debts owed
or due or asserted to be owed or due another.
Notwithstanding the exclusion provided by clause
(F) of the last sentence of this paragraph, the
term includes any creditor who, in the process
of collecting his own debts, uses any name other
than his own which would indicate that a third
person is collecting or attempting to collect
such debts. For the purpose of section 808(6),
such term also includes any person who uses any
instrumentality of interstate commerce or the
mails in any business the principal purpose of
which is the enforcement of security interests.
The term does not include --
(A) any officer or employee of a creditor while,
in the name of the creditor, collecting debts
for such creditor;
(B) any person while acting as a debt collector
for another person, both of whom are related by
common ownership or affiliated by corporate
control, if the person acting as a debt
collector does so only for persons to whom it is
so related or affiliated and if the principal
business of such person is not the collection of
debts;
(C) any officer or employee of the United States
or any State to the extent that collecting or
attempting to collect any debt is in the
performance of his official duties;
(D) any person while serving or attempting to
serve legal process on any other person in
connection with the judicial enforcement of any
debt;
(E) any nonprofit organization which, at the
request of consumers, performs bona fide
consumer credit counseling and assists consumers
in the liquidation of their debts by receiving
payments from such consumers and distributing
such amounts to creditors; and
(F) any person collecting or attempting to
collect any debt owed or due or asserted to be
owed or due another to the extent such activity
(i) is incidental to a bona fide fiduciary
obligation or a bona fide escrow arrangement;
(ii) concerns a debt which was originated by
such person; (iii) concerns a debt which was not
in default at the time it was obtained by such
person; or (iv) concerns a debt obtained by such
person as a secured party in a commercial credit
transaction involving the creditor.
(7) The term "location information" means a
consumer's place of abode and his telephone
number at such place, or his place of
employment.
(8) The term "State" means any State, territory,
or possession of the United States, the District
of Columbia, the Commonwealth of Puerto Rico, or
any political subdivision of any of the
foregoing.
¤ 804. Acquisition of location
information [15 USC 1692b]
Any debt collector communicating with any person
other than the consumer for the purpose of
acquiring location information about the
consumer shall --
(1) identify himself, state that he is
confirming or correcting location information
concerning the consumer, and, only if expressly
requested, identify his employer;
(2) not state that such consumer owes any debt;
(3) not communicate with any such person more
than once unless requested to do so by such
person or unless the debt collector reasonably
believes that the earlier response of such
person is erroneous or incomplete and that such
person now has correct or complete location
information;
(4) not communicate by post card;
(5) not use any language or symbol on any
envelope or in the contents of any communication
effected by the mails or telegram that indicates
that the debt collector is in the debt
collection business or that the communication
relates to the collection of a debt; and
(6) after the debt collector knows the consumer
is represented by an attorney with regard to the
subject debt and has knowledge of, or can
readily ascertain, such attorney's name and
address, not communicate with any person other
than that attorney, unless the attorney fails to
respond within a reasonable period of time to
the communication from the debt collector.
¤ 805. Communication in connection
with debt collection [15 USC 1692c]
(a) COMMUNICATION WITH THE CONSUMER GENERALLY.
Without the prior consent of the consumer given
directly to the debt collector or the express
permission of a court of competent jurisdiction,
a debt collector may not communicate with a
consumer in connection with the collection of
any debt --
(1) at any unusual time or place or a time or
place known or which should be known to be
inconvenient to the consumer. In the absence of
knowledge of circumstances to the contrary, a
debt collector shall assume that the convenient
time for communicating with a consumer is after
8 o'clock antimeridian and before 9 o'clock
postmeridian, local time at the consumer's
location;
(2) if the debt collector knows the consumer is
represented by an attorney with respect to such
debt and has knowledge of, or can readily
ascertain, such attorney's name and address,
unless the attorney fails to respond within a
reasonable period of time to a communication
from the debt collector or unless the attorney
consents to direct communication with the
consumer; or
(3) at the consumer's place of employment if the
debt collector knows or has reason to know that
the consumer's employer prohibits the consumer
from receiving such communication.
(b) COMMUNICATION WITH THIRD PARTIES. Except as
provided in section 804, without the prior
consent of the consumer given directly to the
debt collector, or the express permission of a
court of competent jurisdiction, or as
reasonably necessary to effectuate a
postjudgment judicial remedy, a debt collector
may not communicate, in connection with the
collection of any debt, with any person other
than a consumer, his attorney, a consumer
reporting agency if otherwise permitted by law,
the creditor, the attorney of the creditor, or
the attorney of the debt collector.
(c) CEASING COMMUNICATION. If a consumer
notifies a debt collector in writing that the
consumer refuses to pay a debt or that the
consumer wishes the debt collector to cease
further communication with the consumer, the
debt collector shall not communicate further
with the consumer with respect to such debt,
except --
(1) to advise the consumer that the debt
collector's further efforts are being
terminated;
(2) to notify the consumer that the debt
collector or creditor may invoke specified
remedies which are ordinarily invoked by such
debt collector or creditor; or
(3) where applicable, to notify the consumer
that the debt collector or creditor intends to
invoke a specified remedy.
If such notice from the consumer is made by
mail, notification shall be complete upon
receipt.
(d) For the purpose of this section, the term
"consumer" includes the consumer's spouse,
parent (if the consumer is a minor), guardian,
executor, or administrator.
¤ 806. Harassment or abuse [15 USC
1692d]
A debt collector may not engage in any conduct
the natural consequence of which is to harass,
oppress, or abuse any person in connection with
the collection of a debt. Without limiting the
general application of the foregoing, the
following conduct is a violation of this
section:
(1) The use or threat of use of violence or
other criminal means to harm the physical
person, reputation, or property of any person.
(2) The use of obscene or profane language or
language the natural consequence of which is to
abuse the hearer or reader.
(3) The publication of a list of consumers who
allegedly refuse to pay debts, except to a
consumer reporting agency or to persons meeting
the requirements of section 603(f) or 604(3)1 of
this Act.
(4) The advertisement for sale of any debt to
coerce payment of the debt.
(5) Causing a telephone to ring or engaging any
person in telephone conversation repeatedly or
continuously with intent to annoy, abuse, or
harass any person at the called number.
(6) Except as provided in section 804, the
placement of telephone calls without meaningful
disclosure of the caller's identity.
¤ 807. False or misleading
representations [15 USC 1962e]
A debt collector may not use any false,
deceptive, or misleading representation or means
in connection with the collection of any debt.
Without limiting the general application of the
foregoing, the following conduct is a violation
of this section:
(1) The false representation or implication that
the debt collector is vouched for, bonded by, or
affiliated with the United States or any State,
including the use of any badge, uniform, or
facsimile thereof.
(2) The false representation of --
(A) the character, amount, or legal status of
any debt; or
(B) any services rendered or compensation which
may be lawfully received by any debt collector
for the collection of a debt.
(3) The false representation or implication that
any individual is an attorney or that any
communication is from an attorney.
(4) The representation or implication that
nonpayment of any debt will result in the arrest
or imprisonment of any person or the seizure,
garnishment, attachment, or sale of any property
or wages of any person unless such action is
lawful and the debt collector or creditor
intends to take such action.
(5) The threat to take any action that cannot
legally be taken or that is not intended to be
taken.
(6) The false representation or implication that
a sale, referral, or other transfer of any
interest in a debt shall cause the consumer to
--
(A) lose any claim or defense to payment of the
debt; or
(B) become subject to any practice prohibited by
this title.
(7) The false representation or implication that
the consumer committed any crime or other
conduct in order to disgrace the consumer.
(8) Communicating or threatening to communicate
to any person credit information which is known
or which should be known to be false, including
the failure to communicate that a disputed debt
is disputed.
(9) The use or distribution of any written
communication which simulates or is falsely
represented to be a document authorized, issued,
or approved by any court, official, or agency of
the United States or any State, or which creates
a false impression as to its source,
authorization, or approval.
(10) The use of any false representation or
deceptive means to collect or attempt to collect
any debt or to obtain information concerning a
consumer.
(11) The failure to disclose in the initial
written communication with the consumer and, in
addition, if the initial communication with the
consumer is oral, in that initial oral
communication, that the debt collector is
attempting to collect a debt and that any
information obtained will be used for that
purpose, and the failure to disclose in
subsequent communications that the communication
is from a debt collector, except that this
paragraph shall not apply to a formal pleading
made in connection with a legal action.
(12) The false representation or implication
that accounts have been turned over to innocent
purchasers for value.
(13) The false representation or implication
that documents are legal process.
(14) The use of any business, company, or
organization name other than the true name of
the debt collector's business, company, or
organization.
(15) The false representation or implication
that documents are not legal process forms or do
not require action by the consumer.
(16) The false representation or implication
that a debt collector operates or is employed by
a consumer reporting agency as defined by
section 603(f) of this Act.
¤ 808. Unfair practices [15 USC
1692f]
A debt collector may not use unfair or
unconscionable means to collect or attempt to
collect any debt. Without limiting the general
application of the foregoing, the following
conduct is a violation of this section:
(1) The collection of any amount (including any
interest, fee, charge, or expense incidental to
the principal obligation) unless such amount is
expressly authorized by the agreement creating
the debt or permitted by law.
(2) The acceptance by a debt collector from any
person of a check or other payment instrument
postdated by more than five days unless such
person is notified in writing of the debt
collector's intent to deposit such check or
instrument not more than ten nor less than three
business days prior to such deposit.
(3) The solicitation by a debt collector of any
postdated check or other postdated payment
instrument for the purpose of threatening or
instituting criminal prosecution.
(4) Depositing or threatening to deposit any
postdated check or other postdated payment
instrument prior to the date on such check or
instrument.
(5) Causing charges to be made to any person for
communications by concealment of the true
propose of the communication. Such charges
include, but are not limited to, collect
telephone calls and telegram fees.
(6) Taking or threatening to take any
nonjudicial action to effect dispossession or
disablement of property if --
(A) there is no present right to possession of
the property claimed as collateral through an
enforceable security interest;
(B) there is no present intention to take
possession of the property; or
(C) the property is exempt by law from such
dispossession or disablement.
(7) Communicating with a consumer regarding a
debt by post card.
(8) Using any language or symbol, other than the
debt collector's address, on any envelope when
communicating with a consumer by use of the
mails or by telegram, except that a debt
collector may use his business name if such name
does not indicate that he is in the debt
collection business.
¤ 809. Validation of debts [15 USC
1692g]
(a) Within five days after the initial
communication with a consumer in connection with
the collection of any debt, a debt collector
shall, unless the following information is
contained in the initial communication or the
consumer has paid the debt, send the consumer a
written notice containing --
(1) the amount of the debt;
(2) the name of the creditor to whom the debt is
owed;
(3) a statement that unless the consumer, within
thirty days after receipt of the notice,
disputes the validity of the debt, or any
portion thereof, the debt will be assumed to be
valid by the debt collector;
(4) a statement that if the consumer notifies
the debt collector in writing within the
thirty-day period that the debt, or any portion
thereof, is disputed, the debt collector will
obtain verification of the debt or a copy of a
judgment against the consumer and a copy of such
verification or judgment will be mailed to the
consumer by the debt collector; and
(5) a statement that, upon the consumer's
written request within the thirty-day period,
the debt collector will provide the consumer
with the name and address of the original
creditor, if different from the current
creditor.
(b) If the consumer notifies the debt collector
in writing within the thirty-day period
described in subsection (a) that the debt, or
any portion thereof, is disputed, or that the
consumer requests the name and address of the
original creditor, the debt collector shall
cease collection of the debt, or any disputed
portion thereof, until the debt collector
obtains verification of the debt or any copy of
a judgment, or the name and address of the
original creditor, and a copy of such
verification or judgment, or name and address of
the original creditor, is mailed to the consumer
by the debt collector.
(c) The failure of a consumer to dispute the
validity of a debt under this section may not be
construed by any court as an admission of
liability by the consumer.
¤ 810. Multiple debts [15 USC 1692h]
If any consumer owes multiple debts and makes
any single payment to any debt collector with
respect to such debts, such debt collector may
not apply such payment to any debt which is
disputed by the consumer and, where applicable,
shall apply such payment in accordance with the
consumer's directions.
¤ 811. Legal actions by debt
collectors [15 USC 1692i]
(a) Any debt collector who brings any legal
action on a debt against any consumer shall --
(1) in the case of an action to enforce an
interest in real property securing the
consumer's obligation, bring such action only in
a judicial district or similar legal entity in
which such real property is located; or
(2) in the case of an action not described in
paragraph (1), bring such action only in the
judicial district or similar legal entity --
(A) in which such consumer signed the contract
sued upon; or
(B) in which such consumer resides at the
commencement of the action.
(b) Nothing in this title shall be construed to
authorize the bringing of legal actions by debt
collectors.
¤ 812. Furnishing certain deceptive
forms [15 USC 1692j]
(a) It is unlawful to design, compile, and
furnish any form knowing that such form would be
used to create the false belief in a consumer
that a person other than the creditor of such
consumer is participating in the collection of
or in an attempt to collect a debt such consumer
allegedly owes such creditor, when in fact such
person is not so participating.
(b) Any person who violates this section shall
be liable to the same extent and in the same
manner as a debt collector is liable under
section 813 for failure to comply with a
provision of this title.
¤ 813. Civil liability [15 USC
1692k]
(a) Except as otherwise provided by this
section, any debt collector who fails to comply
with any provision of this title with respect to
any person is liable to such person in an amount
equal to the sum of --
(1) any actual damage sustained by such person
as a result of such failure;
(2) (A) in the case of any action by an
individual, such additional damages as the court
may allow, but not exceeding $1,000; or
(B) in the case of a class action, (i) such
amount for each named plaintiff as could be
recovered under subparagraph (A), and (ii) such
amount as the court may allow for all other
class members, without regard to a minimum
individual recovery, not to exceed the lesser of
$500,000 or 1 per centum of the net worth of the
debt collector; and
(3) in the case of any successful action to
enforce the foregoing liability, the costs of
the action, together with a reasonable
attorney's fee as determined by the court. On a
finding by the court that an action under this
section was brought in bad faith and for the
purpose of harassment, the court may award to
the defendant attorney's fees reasonable in
relation to the work expended and costs.
(b) In determining the amount of liability in
any action under subsection (a), the court shall
consider, among other relevant factors --
(1) in any individual action under subsection
(a)(2)(A), the frequency and persistence of
noncompliance by the debt collector, the nature
of such noncompliance, and the extent to which
such noncompliance was intentional; or
(2) in any class action under subsection
(a)(2)(B), the frequency and persistence of
noncompliance by the debt collector, the nature
of such noncompliance, the resources of the debt
collector, the number of persons adversely
affected, and the extent to which the debt
collector's noncompliance was intentional.
(c) A debt collector may not be held liable in
any action brought under this title if the debt
collector shows by a preponderance of evidence
that the violation was not intentional and
resulted from a bona fide error notwithstanding
the maintenance of procedures reasonably adapted
to avoid any such error.
(d) An action to enforce any liability created
by this title may be brought in any appropriate
United States district court without regard to
the amount in controversy, or in any other court
of competent jurisdiction, within one year from
the date on which the violation occurs.
(e) No provision of this section imposing any
liability shall apply to any act done or omitted
in good faith in conformity with any advisory
opinion of the Commission, notwithstanding that
after such act or omission has occurred, such
opinion is amended, rescinded, or determined by
judicial or other authority to be invalid for
any reason.
¤ 814. Administrative enforcement
[15 USC 1692l]
(a) Compliance with this title shall be enforced
by the Commission, except to the extend that
enforcement of the requirements imposed under
this title is specifically committed to another
agency under subsection (b). For purpose of the
exercise by the Commission of its functions and
powers under the Federal Trade Commission Act, a
violation of this title shall be deemed an
unfair or deceptive act or practice in violation
of that Act. All of the functions and powers of
the Commission under the Federal Trade
Commission Act are available to the Commission
to enforce compliance by any person with this
title, irrespective of whether that person is
engaged in commerce or meets any other
jurisdictional tests in the Federal Trade
Commission Act, including the power to enforce
the provisions of this title in the same manner
as if the violation had been a violation of a
Federal Trade Commission trade regulation rule.
(b) Compliance with any requirements imposed
under this title shall be enforced under --
(1) section 8 of the Federal Deposit Insurance
Act, in the case of --
(A) national banks, by the Comptroller of the
Currency;
(B) member banks of the Federal Reserve System
(other than national banks), by the Federal
Reserve Board; and
(C) banks the deposits or accounts of which are
insured by the Federal Deposit Insurance
Corporation (other than members of the Federal
Reserve System), by the Board of Directors of
the Federal Deposit Insurance Corporation;
(2) section 5(d) of the Home Owners Loan Act of
1933, section 407 of the National Housing Act,
and sections 6(i) and 17 of the Federal Home
Loan Bank Act, by the Federal Home Loan Bank
Board (acting directing or through the Federal
Savings and Loan Insurance Corporation), in the
case of any institution subject to any of those
provisions;
(3) the Federal Credit Union Act, by the
Administrator of the National Credit Union
Administration with respect to any Federal
credit union;
(4) subtitle IV of Title 49, by the Interstate
Commerce Commission with respect to any common
carrier subject to such subtitle;
(5) the Federal Aviation Act of 1958, by the
Secretary of Transportation with respect to any
air carrier or any foreign air carrier subject
to that Act; and
(6) the Packers and Stockyards Act, 1921 (except
as provided in section 406 of that Act), by the
Secretary of Agriculture with respect to any
activities subject to that Act.
(c) For the purpose of the exercise by any
agency referred to in subsection (b) of its
powers under any Act referred to in that
subsection, a violation of any requirement
imposed under this title shall be deemed to be a
violation of a requirement imposed under that
Act. In addition to its powers under any
provision of law specifically referred to in
subsection (b), each of the agencies referred to
in that subsection may exercise, for the purpose
of enforcing compliance with any requirement
imposed under this title any other authority
conferred on it by law, except as provided in
subsection (d).
(d) Neither the Commission nor any other agency
referred to in subsection (b) may promulgate
trade regulation rules or other regulations with
respect to the collection of debts by debt
collectors as defined in this title.
¤ 815. Reports to Congress by the
Commission [15 USC 1692m]
(a) Not later than one year after the effective
date of this title and at one-year intervals
thereafter, the Commission shall make reports to
the Congress concerning the administration of
its functions under this title, including such
recommendations as the Commission deems
necessary or appropriate. In addition, each
report of the Commission shall include its
assessment of the extent to which compliance
with this title is being achieved and a summary
of the enforcement actions taken by the
Commission under section 814 of this title.
(b) In the exercise of its functions under this
title, the Commission may obtain upon request
the views of any other Federal agency which
exercises enforcement functions under section
814 of this title.
¤ 816. Relation to State laws [15
USC 1692n]
This title does not annul, alter, or affect, or
exempt any person subject to the provisions of
this title from complying with the laws of any
State with respect to debt collection practices,
except to the extent that those laws are
inconsistent with any provision of this title,
and then only to the extent of the
inconsistency. For purposes of this section, a
State law is not inconsistent with this title if
the protection such law affords any consumer is
greater than the protection provided by this
title.
¤ 817. Exemption for State
regulation [15 USC 1692o]
The Commission shall by regulation exempt from
the requirements of this title any class of debt
collection practices within any State if the
Commission determines that under the law of that
State that class of debt collection practices is
subject to requirements substantially similar to
those imposed by this title, and that there is
adequate provision for enforcement.
¤ 818. Effective date [15 USC 1692 note]
This title takes effect upon the expiration of
six months after the date of its enactment, but
section 809 shall apply only with respect to
debts for which the initial attempt to collect
occurs after such effective date.
Approved September 20, 1977
ENDNOTES
1. So in original; however, should read
"604(a)(3)."
LEGISLATIVE HISTORY:
Public Law 95-109 [H.R. 5294]
HOUSE REPORT No. 95-131 (Comm. on Banking,
Finance, and Urban Affairs).
SENATE REPORT No. 95-382 (Comm. on Banking,
Housing, and Urban Affairs).
CONGRESSIONAL RECORD, Vol. 123 (1977):
Apr. 4, considered and passed House.
Aug. 5, considered and passed Senate, amended.
Sept. 8, House agreed to Senate amendment.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS,
Vol. 13, No. 39:
Sept. 20, Presidential statement.
AMENDMENTS:
SECTION 621, SUBSECTIONS (b)(3), (b)(4) and
(b)(5) were amended to transfer certain
administrative enforcement responsibilities,
pursuant to Pub. L. 95-473, ¤ 3(b), Oct. 17,
1978. 92 Stat. 166; Pub. L. 95-630, Title V. ¤
501, November 10, 1978, 92 Stat. 3680; Pub. L.
98-443, ¤ 9(h), Oct. 4, 1984, 98 Stat. 708.
SECTION 803, SUBSECTION (6), defining "debt
collector," was amended to repeal the attorney
at law exemption at former Section (6)(F) and to
redesignate Section 803(6)(G) pursuant to Pub.
L. 99-361, July 9, 1986, 100 Stat. 768. For
legislative history, see H.R. 237, HOUSE REPORT
No. 99-405 (Comm. on Banking, Finance and Urban
Affairs). CONGRESSIONAL RECORD: Vol. 131 (1985):
Dec. 2, considered and passed House. Vol. 132
(1986): June 26, considered and passed Senate.
SECTION 807, SUBSECTION (11), was amended to
affect when debt collectors must state (a) that
they are attempting to collect a debt and (b)
that information obtained will be used for that
purpose, pursuant to Pub. L. 104-208 ¤ 2305, 110
Stat. 3009 (Sept. 30, 1996).
Fair Credit
Reporting Act (FCRA)
Fair Credit Reporting Act (15 U.S.C. §§
1681-1681(v), as amended)
The
Act protects information collected by consumer
reporting agencies such as credit bureaus,
medical information companies and tenant
screening services. 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 also have specific legal obligations,
including the duty to investigate disputed
information. Also, users of the information for
credit, insurance, or employment purposes must
notify the consumer when an adverse action is
taken on the basis of such reports. Further,
users must identify the company that provided
the report, so that the accuracy and
completeness of the report may be verified or
contested by the consumer.
Under the Fair Credit Reporting Act, you have
the right to the following:
Know
all the information that's in your credit
report. In most cases, you have the right to
know the source of that information
Obtain a free copy of your report within 60 days
of a credit denial. Otherwise, the credit bureau
may charge you a nominal fee for this service.
Know who has requested your report in the last
year.
Confidentiality of personal medical information.
Such information can only be released with your
permission. Approve access to your credit record
by prospective employers. Have the credit bureau
investigate an error in your report. You must
notify the bureau of your dispute in writing.
The credit bureau must notify you within five
days of a completed investigation and fix
mistakes in your record within 30 days. Then it
must send a corrected report to anyone who asked
for a copy in the past six months. At your
request, the bureau must also send a revised
report to potential employers who have requested
it within the past two years. If you disagree
with the credit bureau's conclusion, you have a
right to include a brief explanation in your
credit report. Request credit bureaus stop
selling your name to companies that make
pre-approved credit offers.
Fair Credit Reporting Act
United States Code
TITLE 15 - COMMERCE AND TRADE
CHAPTER 41 - CONSUMER CREDIT PROTECTION
SUBCHAPTER III - CREDIT REPORTING AGENCIES
Section 1681. Congressional Findings And
Statement Of Purpose
Section 1681a. Definitions; Rules Of
Construction
Section 1681b. Permissible Purposes Of Consumer
Reports
Section 1681c. Requirements Relating To
Information Contained In Consumer Reports
Section 1681d Disclosure Of Investigative
Consumer Reports
Section 1681e. Compliance Procedures
Section 1681f. Disclosures To Governmental
Agencies
Section 1681g. Disclosures To Consumers
Section 1681h. Conditions And Form Of Disclosure
To Consumers
Section 1681i. Procedure In Case Of Disputed
Accuracy
Section 1681j. Charges For Certain Disclosures
Section 1681k. Public Record Information For
Employment Purposes
Section 1681l. Restrictions On Investigative
Consumer Reports
Section 1681m. Requirements On Users Of Consumer
Reports
Section 1681n. Civil Liability For Willful
Noncompliance
Section 1681o. Civil Liability For Negligent
Noncompliance
Section 1681p. Jurisdiction Of Courts;
Limitation Of Actions
Section 1681q. Obtaining Information Under False
Pretenses
Section 1681r. Unauthorized Disclosures By
Officers Or Employees
Section 1681s. Administrative Enforcement
Section 1681s-1. Information On Overdue Child
Support Obligations
Section 1681s-2. Responsibilities Of Furnishers
Of Information To Consumer Reporting Agencies
Section 1681t. Relation To State Laws
Section 1681u. Disclosures To FBI For
Counterintelligence Purposes
Section 1681v. Disclosures To Governmental
Agencies For Counterterrorism Purposes
Section 1681. Congressional findings and
statement of purpose
(a)
Accuracy and fairness of credit reporting
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 the credit worthiness, (FOOTNOTE
1) credit standing,
credit capacity, character, and general
reputation of consumers.
(FOOTNOTE 1) So in original. Probably should be
''creditworthiness,''.
(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 the consumer's right to
privacy.
(b) Reasonable procedures
It is the purpose of this subchapter 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 subchapter.
Section 1681a. Definitions; rules of
construction
(a)
Definitions and rules of construction set forth
in this
section are applicable for the purposes of this
subchapter.
(b) The term ''person'' means any individual,
partnership,
corporation, trust, estate, cooperative,
association, government or
governmental subdivision or agency, or other
entity.
(c) The term ''consumer'' means an individual.
(d) Consumer Report. -
(1) In general. - The term ''consumer report''
means any
written, oral, or other communication of any
information by a
consumer reporting agency bearing on a
consumer's credit
worthiness, (FOOTNOTE 1) 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 part for the purpose of serving as a
factor in
establishing the consumer's eligibility for -
(FOOTNOTE 1) So in original. Probably should be
''creditworthiness,''.
(A) credit or insurance to be used primarily for
personal,
family, or household purposes;
(B) employment purposes; or
(C) any other purpose authorized under section
1681b of this
title.
(2) Exclusions. - The term ''consumer report''
does not include
-
(A) any -
(i) report containing information solely as to
transactions
or experiences between the consumer and the
person making the
report;
(ii) communication of that information among
persons
related by common ownership or affiliated by
corporate
control; or
(iii) communication of other information among
persons
related by common ownership or affiliated by
corporate
control, if it is clearly and conspicuously
disclosed to the
consumer that the information may be
communicated among such
persons and the consumer is given the
opportunity, before the
time that the information is initially
communicated, to
direct that such information not be communicated
among such
persons;
(B) any authorization or approval of a specific
extension of
credit directly or indirectly by the issuer of a
credit card or
similar device;
(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 or her
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 1681m of this
title; or
(D) a communication described in subsection (o)
of this
section.
(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, dues, 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.
(g) The term ''file'', when used in connection
with information
on any consumer, means all of the information on
that consumer
recorded and retained by a consumer reporting
agency regardless of
how the information is stored.
(h) The term ''employment purposes'' when used
in connection with
a consumer report means a report used for the
purpose of evaluating
a consumer for employment, promotion,
reassignment or retention as
an employee.
(i) The term ''medical information'' means
information or records
obtained, with the consent of the individual to
whom it relates,
from licensed physicians or medical
practitioners, hospitals,
clinics, or other medical or medically related
facilities.
(j) Definitions Relating to Child Support
Obligations. -
(1) Overdue support. - The term ''overdue
support'' has the
meaning given to such term in section 666(e) of
title 42.
(2) State or local child support enforcement
agency. - The term
''State or local child support enforcement
agency'' means a State
or local agency which administers a State or
local program for
establishing and enforcing child support
obligations.
(k) Adverse Action. -
(1) Actions included. - The term ''adverse
action'' -
(A) has the same meaning as in section
1691(d)(6) of this
title; and
(B) means -
(i) a denial or cancellation of, an increase in
any charge
for, or a reduction or other adverse or
unfavorable change in
the terms of coverage or amount of, any
insurance, existing
or applied for, in connection with the
underwriting of
insurance;
(ii) a denial of employment or any other
decision for
employment purposes that adversely affects any
current or
prospective employee;
(iii) a denial or cancellation of, an increase
in any
charge for, or any other adverse or unfavorable
change in the
terms of, any license or benefit described in
section
1681b(a)(3)(D) of this title; and
(iv) an action taken or determination that is -
(I) made in connection with an application that
was made
by, or a transaction that was initiated by, any
consumer,
or in connection with a review of an account
under section
1681b(a)(3)(F)(ii) of this title; and
(II) adverse to the interests of the consumer.
(2) Applicable findings, decisions, commentary,
and orders. -
For purposes of any determination of whether an
action is an
adverse action under paragraph (1)(A), all
appropriate final
findings, decisions, commentary, and orders
issued under section
1691(d)(6) of this title by the Board of
Governors of the Federal
Reserve System or any court shall apply.
(l) Firm Offer of Credit or Insurance. - The
term ''firm offer of
credit or insurance'' means any offer of credit
or insurance to a
consumer that will be honored if the consumer is
determined, based
on information in a consumer report on the
consumer, to meet the
specific criteria used to select the consumer
for the offer, except
that the offer may be further conditioned on one
or more of the
following:
(1) The consumer being determined, based on
information in the
consumer's application for the credit or
insurance, to meet
specific criteria bearing on credit worthiness
(FOOTNOTE 2) or
insurability, as applicable, that are
established -
(FOOTNOTE 2) So in original. Probably should be
''creditworthiness''.
(A) before selection of the consumer for the
offer; and
(B) for the purpose of determining whether to
extend credit
or insurance pursuant to the offer.
(2) Verification -
(A) that the consumer continues to meet the
specific criteria
used to select the consumer for the offer, by
using information
in a consumer report on the consumer,
information in the
consumer's application for the credit or
insurance, or other
information bearing on the credit worthiness
(FOOTNOTE 2) or
insurability of the consumer; or
(B) of the information in the consumer's
application for the
credit or insurance, to determine that the
consumer meets the
specific criteria bearing on credit worthiness
(FOOTNOTE 2) or
insurability.
(3) The consumer furnishing any collateral that
is a
requirement for the extension of the credit or
insurance that was
-
(A) established before selection of the consumer
for the
offer of credit or insurance; and
(B) disclosed to the consumer in the offer of
credit or
insurance.
(m) Credit or Insurance Transaction That Is Not
Initiated by the
Consumer. - The term ''credit or insurance
transaction that is not
initiated by the consumer'' does not include the
use of a consumer
report by a person with which the consumer has
an account or
insurance policy, for purposes of -
(1) reviewing the account or insurance policy;
or
(2) collecting the account.
(n) State. - The term ''State'' means any State,
the Commonwealth
of Puerto Rico, the District of Columbia, and
any territory or
possession of the United States.
(o) Excluded Communications. - A communication
is described in
this subsection if it is a communication -
(1) that, but for subsection (d)(2)(D) of this
section, would
be an investigative consumer report;
(2) that is made to a prospective employer for
the purpose of -
(A) procuring an employee for the employer; or
(B) procuring an opportunity for a natural
person to work for
the employer;
(3) that is made by a person who regularly
performs such
procurement;
(4) that is not used by any person for any
purpose other than a
purpose described in subparagraph (A) or (B) of
paragraph (2);
and
(5) with respect to which -
(A) the consumer who is the subject of the
communication -
(i) consents orally or in writing to the nature
and scope
of the communication, before the collection of
any
information for the purpose of making the
communication;
(ii) consents orally or in writing to the making
of the
communication to a prospective employer, before
the making of
the communication; and
(iii) in the case of consent under clause (i) or
(ii) given
orally, is provided written confirmation of that
consent by
the person making the communication, not later
than 3
business days after the receipt of the consent
by that
person;
(B) the person who makes the communication does
not, for the
purpose of making the communication, make any
inquiry that if
made by a prospective employer of the consumer
who is the
subject of the communication would violate any
applicable
Federal or State equal employment opportunity
law or
regulation; and
(C) the person who makes the communication -
(i) discloses in writing to the consumer who is
the subject
of the communication, not later than 5 business
days after
receiving any request from the consumer for such
disclosure,
the nature and substance of all information in
the consumer's
file at the time of the request, except that the
sources of
any information that is acquired solely for use
in making the
communication and is actually used for no other
purpose, need
not be disclosed other than under appropriate
discovery
procedures in any court of competent
jurisdiction in which an
action is brought; and
(ii) notifies the consumer who is the subject of
the
communication, in writing, of the consumer's
right to request
the information described in clause (i).
(p) Consumer Reporting Agency That Compiles and
Maintains Files
on Consumers on a Nationwide Basis. - The term
''consumer reporting
agency that compiles and maintains files on
consumers on a
nationwide basis'' means a consumer reporting
agency that regularly
engages in the practice of assembling or
evaluating, and
maintaining, for the purpose of furnishing
consumer reports to
third parties bearing on a consumer's credit
worthiness, (FOOTNOTE
3) credit standing, or credit capacity, each of
the following
regarding consumers residing nationwide:
(FOOTNOTE 3) So in original. Probably should be
''creditworthiness,''.
(1) Public record information.
(2) Credit account information from persons who
furnish that
information regularly and in the ordinary course
of business.
Section 1681b. Permissible purposes of
consumer reports
(a)
In general
Subject to subsection (c) of this section, any
consumer reporting
agency may furnish a consumer report under the
following
circumstances and no other:
(1) In response to the order of a court having
jurisdiction to
issue such an order, or a subpoena issued in
connection with
proceedings before a Federal grand jury.
(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) intends to use the information, as a
potential investor or
servicer, or current insurer, in connection with
a valuation of,
or an assessment of the credit or prepayment
risks associated
with, an existing credit obligation; or
(F) otherwise has a legitimate business need for
the
information -
(i) in connection with a business transaction
that is
initiated by the consumer; or
(ii) to review an account to determine whether
the consumer
continues to meet the terms of the account.
(4) In response to a request by the head of a
State or local
child support enforcement agency (or a State or
local government
official authorized by the head of such an
agency), if the person
making the request certifies to the consumer
reporting agency that
-
(A) the consumer report is needed for the
purpose of
establishing an individual's capacity to make
child support
payments or determining the appropriate level of
such payments;
(B) the paternity of the consumer for the child
to which the
obligation relates has been established or
acknowledged by the
consumer in accordance with State laws under
which the obligation
arises (if required by those laws);
(C) the person has provided at least 10 days'
prior notice to
the consumer whose report is requested, by
certified or
registered mail to the last known address of the
consumer, that
the report will be requested; and
(D) the consumer report will be kept
confidential, will be used
solely for a purpose described in subparagraph
(A), and will not
be used in connection with any other civil,
administrative, or
criminal proceeding, or for any other purpose.
(5) To an agency administering a State plan
under section 654 of
title 42 for use to set an initial or modified
child support award.
(b) Conditions for furnishing and using consumer
reports for
employment purposes
(1) Certification from user
A consumer reporting agency may furnish a
consumer report for
employment purposes only if -
(A) the person who obtains such report from the
agency
certifies to the agency that -
(i) the person has complied with paragraph (2)
with respect
to the consumer report, and the person will
comply with
paragraph (3) with respect to the consumer
report if
paragraph (3) becomes applicable; and
(ii) information from the consumer report will
not be used
in violation of any applicable Federal or State
equal
employment opportunity law or regulation; and
(B) the consumer reporting agency provides with
the report,
or has previously provided, a summary of the
consumer's rights
under this subchapter, as prescribed by the
Federal Trade
Commission under section 1681g(c)(3) of this
title.
(2) Disclosure to consumer
(A) In general
Except as provided in subparagraph (B), a person
may not
procure a consumer report, or cause a consumer
report to be
procured, for employment purposes with respect
to any consumer,
unless -
(i) a clear and conspicuous disclosure has been
made in
writing to the consumer at any time before the
report is
procured or caused to be procured, in a document
that
consists solely of the disclosure, that a
consumer report may
be obtained for employment purposes; and
(ii) the consumer has authorized in writing
(which
authorization may be made on the document
referred to in
clause (i)) the procurement of the report by
that person.
(B) Application by mail, telephone, computer, or
other similar
means
If a consumer described in subparagraph (C)
applies for
employment by mail, telephone, computer, or
other similar
means, at any time before a consumer report is
procured or
caused to be procured in connection with that
application -
(i) the person who procures the consumer report
on the
consumer for employment purposes shall provide
to the
consumer, by oral, written, or electronic means,
notice that
a consumer report may be obtained for employment
purposes,
and a summary of the consumer's rights under
section
1681m(a)(3) of this title; and
(ii) the consumer shall have consented, orally,
in writing,
or electronically to the procurement of the
report by that
person.
(C) Scope
Subparagraph (B) shall apply to a person
procuring a consumer
report on a consumer in connection with the
consumer's
application for employment only if -
(i) the consumer is applying for a position over
which the
Secretary of Transportation has the power to
establish
qualifications and maximum hours of service
pursuant to the
provisions of section 31502 of title 49, or a
position
subject to safety regulation by a State
transportation
agency; and
(ii) as of the time at which the person procures
the report
or causes the report to be procured the only
interaction
between the consumer and the person in
connection with that
employment application has been by mail,
telephone, computer,
or other similar means.
(3) Conditions on use for adverse actions
(A) In general
Except as provided in subparagraph (B), in using
a consumer
report for employment purposes, before taking
any adverse
action based in whole or in part on the report,
the person
intending to take such adverse action shall
provide to the
consumer to whom the report relates -
(i) a copy of the report; and
(ii) a description in writing of the rights of
the consumer
under this subchapter, as prescribed by the
Federal Trade
Commission under section 1681g(c)(3) of this
title.
(B) Application by mail, telephone, computer, or
other similar
means
(i) If a consumer described in subparagraph (C)
applies for
employment by mail, telephone, computer, or
other similar
means, and if a person who has procured a
consumer report on
the consumer for employment purposes takes
adverse action on
the employment application based in whole or in
part on the
report, then the person must provide to the
consumer to whom
the report relates, in lieu of the notices
required under
subparagraph (A) of this section and under
section 1681m(a) of
this title, within 3 business days of taking
such action, an
oral, written or electronic notification -
(I) that adverse action has been taken based in
whole or in
part on a consumer report received from a
consumer reporting
agency;
(II) of the name, address and telephone number
of the
consumer reporting agency that furnished the
consumer report
(including a toll-free telephone number
established by the
agency if the agency compiles and maintains
files on
consumers on a nationwide basis);
(III) that the consumer reporting agency did not
make the
decision to take the adverse action and is
unable to provide
Know
Your Legal Rights As A Consumer