What is the Fair Credit Reporting Act (FCRA)?
The FCRA is a federal law that was passed, in part, to ensure that consumer reporting agencies are governed by reasonable procedures with regards to the confidentiality, accuracy, relevancy and utilization of consumer reports. Certain states, including California, have expanded on the protections of the federal law to include additional protection to consumers in those states. Please note that this law applies to reports other than your credit report such as check writing histories, medical records and home/apartment rental histories.
What Are My Rights Under the FCRA?
- You must be informed if your consumer report is used against you. This means that if anyone uses your report to take an adverse action against you — such as denying credit, insurance or employment – they must inform you and provide the identity of the reporting agency that provided the report.
- You have the right to know what is in your file. The disclosure of your file is free if there has been an adverse action against you, you have placed a fraud alert in your file, you are on public assistance or you are unemployed but expect to apply for a job within 60 days.
- You may always ask for a credit score but be aware that you most likely will have to pay for it.
- You have the right to dispute inaccurate or incorrect information within your file. Once the reporting agency is informed, they must investigate your claim unless it is deemed frivolous.
- The reporting agency is required to correct inaccurate, incomplete or unverifiable information in your file. Usually, this must be done within 30 days.
- There are time limits for reporting negative information: usually 7 years and 10 years for bankruptcies.
- Your report is limited to those with a need-to-know such as a creditor to whom you have applied for credit, an employer or landlord.
- You must consent to have your information given to an employer or prospective employer.
- You have the ability to seek damages when your rights have been violated.
- Identity theft victims and active duty military have additional rights under the law.
There are additional rights provided by California. These include but are not limited to:
- No arrest, indictment, information, misdemeanor complaint or conviction of a crime may be reported more than 7 years after the disposition, release or parole date. These records may also not be reported if pardoned or if the arrest, information, misdemeanor complaint or indictment did not result in a conviction.
- When a copy of your report is requested for employment, the employer not only must get written permission from you but must also provide the source of the report and allow you a copy of the report to be furnished from the agency at no charge.
These additional protections for Californians mainly come from the California Investigative Consumer Reporting Agencies Act which is more stringent than some FCRA requirements.
What Can You Do If Your Rights Under the FCRA Were Violated?
Very often, violations of the FCRA can cause dramatic harm to a consumer. For example, you could be denied a job because of inaccuracies in your report and lose out on substantial potential income. If this was done by the reporting agency willfully, you can claim unlimited actual damages to the extent that you can prove them along with punitive damages and attorney’s fees and costs. You can also choose to pursue statutory damages instead of between $100 and $1000 where you do not have to prove actual damages. If the agency’s actions were negligent, you can sue for actual provable damages and attorney fees and costs.
Potential FCRA violations are a confusing and complex area of the law. If you feel that you have been injured by an FCRA violation and you need a lawyer to sort out the situation, please give our experienced staff a call at (800) 551-7922 to set up your free consultation today.