FTC Approves Changes to Five FCRA Rules

The Federal Trade Commission approved final revisions that would bring several rules that implement parts of the Fair Credit Reporting Act (FCRA) in line with the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).

In separate notices, published in the Federal Register, the FTC approved largely technical changes that would clarify that five FCRA rules enforced by the FTC apply only to motor vehicle dealers. The Dodd-Frank Act, enacted in 2010, transferred rulemaking authority related to parts of the FCRA to the Consumer Financial Protection Bureau, narrowing the FTC’s FCRA rulemaking authority. The final revisions do not make substantive changes to the rules. The FTC sought comment on the proposed rule changes last year.

The changes affect these rules:

• Address Discrepancy Rule, which outlines the obligations of users of consumer reports when they receive a notice of address discrepancy from a nationwide consumer reporting agency (CRA);
• Affiliate Marketing Rule, which gives consumers the right to restrict a person from using certain information obtained from an affiliate to make solicitations to the consumer;
• Furnisher Rule, which requires entities that furnish information to CRAs to establish and implement reasonable written policies and procedures regarding the accuracy and integrity of the information relating to consumers provided to a CRA;
• Pre-screen Opt-Out Notice Rule, which outlines requirements for those who use consumer report information to make unsolicited credit or insurance offers to consumers; and
• Risk-Based Pricing Rule, which requires those who use information from a consumer report to offer less favorable terms to consumers to provide them with a notice about the use of such data.

In addition to the technical changes to the five rules, the Pre-Screen Opt-Out Rule also added the web address where consumers can opt-out of credit offers to the model notices that motor vehicle dealers can use. The Risk-Based Pricing Rule also was updated to include examples that reflect its narrower scope to just motor vehicle dealers. The FTC has created a web page with tips for consumers with poor credit. 

The Commission voted 5-0 to publish the notices in the Federal Register.