07/22/2011 09:03:00 AM EST
FTC Releases Substantial Revisions to Fair Credit Reporting Act Policy Guidance
by Troutman Sanders CFPB Team
On July 20, 2011, the Federal Trade Commission (FTC) issued a
staff report on the Fair Credit Reporting Act (FCRA). Among a host of other
changes, the report rescinds 16 CFR 600.1 (defining the authority and purpose
of the FTC in providing interpretive guidance under FCRA), 600.2 (describing
the legal effect of the FTC's policy guidance), and the Appendix to Part 600
(general commentary and definitions of terms used in FTC's policy
guidance). The report includes other changes to FTC policy guidance
reflecting legislative changes set forth in the Consumer Credit Reporting
Reform Act (CCRA) and the Fair and Accurate Credit Transactions Act (FACT Act).
Perhaps most notably, the staff report repealed the FTC's
1990 Statement of General Policy or Interpretations under the FCRA, which
heretofore had been the primary source of compliance guidance for firms
regulated by the FCRA. The report described the 1990 guidance as
"obsolete," "stale" and "in conflict" with the FRCA as amended by the CCRA and
Though the FTC and the CFPB will share enforcement
authority, the FTC's report comes on the eve of the transfer of rulemaking and
interpretive guidance under the FCRA to the CFPB, effectively giving both
agencies new policy guidance to compel compliance from firms covered by the
FCRA - the first shot across the bow to credit reporting agencies concerning a
new regulatory and enforcement regime under the FCRA.
Taken in tandem with the CFPB's release of its report on July 19, 2011 detailing discrepancies in credit
scores sold to lenders and those sold to consumers, credit reporting agencies
should expect a rapidly evolving regulatory landscape spearheaded by the CFPB
with enforcement support from the FTC.
The full report is available here.
Read more at Consumer Financial Protection Bureau
Report by Troutman Sanders LLP.
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