Advisory Opinion on Fair Credit Reporting; Facially False Data

BILLING CODE: 4810-AM-P

BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Part 1022

Fair Credit Reporting; Facially False Data

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Advisory opinion.

SUMMARY: The Consumer Financial Protection Bureau (Bureau) is issuing this advisory

opinion to highlight that a consumer reporting agency that does not implement reasonable

internal controls to prevent the inclusion of facially false data, including logically inconsistent

information, in consumer reports it prepares is not using reasonable procedures to assure

maximum possible accuracy under section 607(b) of the Fair Credit Reporting Act (FCRA).

DATES: This advisory opinion is effective on [INSERT DATE OF PUBLICATION IN THE

FEDERAL REGISTER].

FOR FURTHER INFORMATION CONTACT: Ilana Waxman, Senior Counsel, Tyler Sines

or Jason Grimes, Counsels, Office of Supervision Policy at (202) 435-7700 or

https://reginquiries.consumerfinance.gov/

. I

f you require this document in an alternative

electronic format, please contact CFPB_Accessibility@cfpb.gov.

SUPPLEMENTARY INFORMATION: The Bureau is issuing this advisory opinion through

the procedures for its Advisory Opinions Policy.

Refer to those procedures for more

information.

85 FR 77987 (Dec. 3, 2020).

I. Advisory Opinion

A. Background

Accuracy in consumer reports is of vital importance to the consumer reporting system,

particularly as consumer reports play an increasingly central role in the lives of American

consumers. Consumer reporting agencies collect and assemble credit, public record, and other

consumer information into consumer reports.

Creditors, insurers, landlords, employers, and

others use the information in these reports to make eligibility determinations and other decisions

that can have a significant impact on consumers. For example, creditors use information in

consumer reports to determine whether, and on what terms, to extend credit to a particular

consumer, while landlords and employers use background screening reports in deciding whether

to rent to prospective tenants and hire employees, respectively.

Inaccurate, derogatory information in consumer reports can have significant adverse

impacts on consumers. For example, inaccurate, derogatory information in consumer reports can

lead to higher interest rates, ineligibility for promotional offers, or otherwise less favorable credit

terms for affected consumers. This in turn may cost consumers hundreds or thousands of dollars

in additional interest. Even worse, inaccurate, derogatory information in consumer reports could

lead lenders to deny a consumer credit entirely, making it difficult or impossible for that

consumer to obtain a mortgage, auto loan, student loan, or other credit. Any of these

consequences can be devastating for a consumer’s financial well-being and life. Inaccurate,

derogatory information in consumer reports can also harm the businesses that use such reports by

leading them to make unsupported decisions.

See 15 U.S.C. 1681a(d) (defining “consumer report”).

Consumer report accuracy depends on the various parties to the consumer reporting

system, including: the three nationwide consumer reporting agencies (Equifax, Experian, and

TransUnion); other consumer reporting agencies, such as background screening companies;

entities such as creditors who furnish information to consumer reporting agencies (i.e.,

furnishers); and public record repositories. While any of these parties may introduce inaccurate

information into the consumer reporting process, a consumer reporting agency is uniquely

positioned to identify certain obvious inaccuracies and implement policies, procedures, and

systems to keep them off of consumer reports. In some cases, such as when certain account or

other information fields on consumer reports are logically inconsistent with other fields of

information, a consumer reporting agency can detect the logical inconsistencies and prevent the

inaccurate information from being included in consumer reports it generates, thereby avoiding

the consumer harm to individual consumers that can result from reporting such inaccurate

information.

Inaccuracy in consumer reports is a long-standing issue that remains a problem today.

Pursuant to its obligations under the Fair and Accurate Credit Transactions (FACT) Act

conduct a study of consumer report accuracy and completeness, the Federal Trade Commission

in 2012 published a report finding, among other things, that one in five consumers who

participated in the study had an error on at least one of their three nationwide credit reports.

Another more recent study, published in 2021, found that over 34% of consumers surveyed were

able to identify at least one error in their credit reports.

Fair and Accurate Credit Transactions Act of 2003, Pub. L. 108-159, sec. 319, 117 Stat. 1952 (2003).

See Fed. Tra de Comm’n, Report to Congress Under Section 319 of the Fair and Accurate Credit Transactions Act

of 2003, at 64 (Dec. 2012), https://www.ftc.gov/sites/default/files/documents/reports/section-3

19-fair-a nd-accurate-

credit-tra nsactions-act-2003-f ifth-interim-federal-tra d e-commission/130211factareport.pdf.

See Syed Ejaz, Consumer Reports, A Broken System: How the Credit Reporting System Fails Consumers and What

to Do About It 4 (June 10, 2021), https://advocacy.consumerreports.org/wp-c

ontent/uploads/2021/06/A-Broken-

System-How-the-Credit-Reporting-System-Fails-Consumers-and-What-to-Do-About-It.pdf.

Consumer complaints submitted to the Bureau continue to reflect significant consumer

concern about inaccuracies in consumer reports. Complaints about “incorrect information on

your report” have represented the largest share of credit or consumer reporting complaints

submitted to the Bureau each year for at least the last six years.

In 2021 alone, companies

responded to more than 157,000 such complaints, representing a majority (53%) of credit or

consumer reporting complaint responses that year.

Moreover, the Bureau continues to see accuracy issues at furnishers and consumer

reporting agencies through its supervisory activities. For example, the Bureau noted in its Spring

2022 Supervisory Highlights that many furnishers lacked “reasonable written policies and

procedures regarding the accuracy and integrity of the information relating to consumers.”

its Summer 2021 Supervisory Highlights, the Bureau explained that some consumer reporting

agencies lacked adequate procedures for assuring maximum possible accuracy of consumer

reports when they “continued to include information in consumer reports that was provided by

unreliable furnishers.”

See Consumer Fin. Prot. Bureau, Consumer Response Annual Report, at 20 (Mar. 2022),

https://files.consumerfinance.gov/f/documents/cfpb_2021-consumer-response-annual-report_2022-03.pdf;

Consumer Fin. Prot. Bureau, Consumer Response Annual Report, at 22 (Mar. 2021),

https://files.consumerfinance.gov/f/documents/cfpb_2020-c

onsumer-response-annual-report_03-2021.pdf;

Consumer Fin. Prot. Bureau, Consumer Response Annual Report, at 19 (Mar. 2020),

https://files.consumerfinance.gov/f/documents/cfpb_consumer-r

esponse-annual-report_2019.pdf; Consumer Fin.

Prot. Burea u, Consumer Response Annual Report, at 19 (Mar. 2019),

https://files.consumerfinance.

gov/f/documents/cfpb_consumer-response-annual-report_2018.pdf; Consumer Fin.

Prot. Burea u, Consumer Response Annual Report, at 13 (Mar. 2018),

https://files.consumerfinance.gov/f/documents/cfpb_consumer-r

esponse-annual-report_2017.pdf; Consumer Fin.

Prot. Burea u, Consumer Response Annual Report, at 18 (Mar. 2017),

https://files.consumerfinance.gov/f/documents/201703_cfpb_Consumer-R

esponse-Annual-Report-2016.PDF.

See Consumer Fin. Prot. Bureau, Consumer Response Annual Report, a t 20 (Mar. 2022),

https://files.consumerfinance.gov/f/documents/cfpb_2021-consumer-response-annual-report_2022-03.pdf f

or m ore

in-depth analyses.

See Consumer Fin. Prot. Bureau, Spring 2022 Supervisory Highlights, at 10 (May 2022),

https://files.consumerfinance.gov/f/documents/cfpb_supervisory-highlights_issue-26_2022-04.pdf.

See Consumer Fin. Prot. Bureau, Summer 2021 Supervisory Highlights, at 7 (Jun. 2021),

https://files.consumerfinance.gov/f/documents/cfpb_supervisory-highlights_issue-24_2021-06.pdf.

The Bureau also continues to find accuracy issues in the consumer reporting context

through its enforcement activities. For example, the Bureau has brought enforcement actions

against consumer reporting agencies whose inadequate “name-only matching” led to reports with

inaccurate derogatory criminal and public records information on consumers.

The Bureau also

has brought enforcement actions against furnishers who furnish information with inherent logical

inconsistencies, such as furnishing an increasing “original loan amount” over time, where that

field should not change.

The FCRA regulates consumer reporting.

The statute was designed to ensure 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 interpreting the statute, Federal courts likewise highlight

the importance of data accuracy. The FCRA was enacted “to protect consumers from the

transmission of inaccurate information about them and to establish credit reporting practices that

utilize accurate, relevant, and current information in a confidential and responsible manner.”

Because of the importance of consumer report accuracy to businesses and consumers, the

structure of the FCRA creates interrelated legal standards and requirements to support the policy

goal of accurate credit reporting. Among these is the requirement that, when preparing a

Consent Order at ¶¶ 8-29, In re Gen. Inf. Svcs. Inc., 2015-0028 (Oct. 29, 2015),

https://files.consumerfinance.gov/f/201510_cfpb_consent-order_general-inf ormation-service-inc.pdf; Complaint a t

¶¶ 5-11, Consumer Fin. Prot. Bureau v. Sterling Infosys., Inc., No. 1:19-cv-10824 (S.D.N.Y. Nov. 22, 2019),

https://www.consumerfinance.gov/enforcement/actions/s

terling-infosystems-inc/.

Consent Order at ¶ 41, In re Hyundai Capital Am., 2022-CFPB-0005 (July 26, 2022),

https://files.consumerfinance.gov/f/documents/cfpb_hyundai-capital-america_consent-order_2022-07.pdf.

See 15 U.S.C. 1681-1681x.

15 U.S.C. 1681(b).

Guimond v. Trans Union Credit Info., 45 F.3d 1329, 1333 (9th Cir.1995) (citations omitted); see also S. Rep. No.

91-517, at 1 (1969) (explaining that the FCRA was intended to “prevent consumers from being unjustly damaged

because of inaccurate or arbitrary information in a credit report”).

consumer report, consumer reporting agencies “shall follow reasonable procedures to assure

maximum possible accuracy of the information concerning the individual about whom the report

relates.”

Inaccuracies in consumer reports can, in part, be attributed to consumer reporting

agencies failing to maintain reasonable procedures, such as business rules, to prevent the

inclusion of facially false data, including logical inconsistencies relating to consumer data and/or

the status or other information associated with consumer accounts, when preparing consumer

reports. Courts have recognized that in “certain instances, inaccurate credit reports by

themselves can fairly be read as evidencing unreasonable procedures[.]”

The Bureau is issuing

this advisory opinion to highlight that the legal requirement to follow reasonable procedures to

assure maximum possible accuracy of the information concerning the individuals about whom

the reports relate includes, but is not limited to, procedures to screen for and eliminate logical

inconsistencies to avoid including facially false data in consumer reports.

There are many logical inconsistencies that could result in inaccurate, facially false data

being included on consumer reports in violation of section 607(b). The following is a non-

exhaustive list of examples of some of the types of logical inconsistencies that reasonable

procedures to assure maximum possible accuracy would screen for and eliminate:

Inconsistent Account Information or Statuses

A consumer reporting agency’s policies and procedures should be sufficient to detect

tradelines with account statuses or codes that are plainly inconsistent with other information

reported for that same account, such that, if included in a consumer report, at least one item of

information therein would necessarily be inaccurate. Such inconsistencies may include:

15 U.S.C. 1681e(b).

Stewart v. Credit Bureau, Inc., 734 F.2d 47, 52 (D.C. Cir. 1984).

• An account whose status is paid in full, and thus has no balance due but nevertheless

reflects a balance due;

• An account that reflects an “Original Loan Amount” that increases over time, an

impossibility by definition;

and

• Derogatory information being reported on an account, although that derogatory

information predates an earlier report that did not include the derogatory information.

A consumer reporting agency’s policies and procedures should further identify and

prevent illogical reporting of a Date of First Delinquency in connection with an account.

Section 605(a) of the FCRA identifies categories of information that cannot be included in a

consumer report after a certain amount of time.

For example, a consumer reporting agency

may not include on a consumer report accounts placed for collection or charged to profit and loss

that antedate the report by more than seven years and 180 days.

This provision enables

consumers to move beyond their past and rebuild their credit following a delinquency. The Date

of First Delinquency provided by a furnisher must reflect the month and year on which the

Cf. Consent Order at ¶ 20, In re Santander Consumer USA Inc., 2022-BCFP-0027 (Dec. 20, 2020) (“Respondent

also reported in approximately 250,000 instances that accounts had a current balance a nd simultaneously furnished

contradictory information, such as also furnishing information indicating that the accounts were paid in full.”),

https://files.consumerfinance.gov/f/documents/cfpb_santander-consumer-usa-inc_consent-order_2020-12.pdf. The

Santander consent order, along with other CFPB consent orders cited herein, relate to furnisher obligations under

section 623 of the FCRA, but the underlying logical inconsistencies involved, as described herein, are illustrative

examples of the types of inconsistencies that a credit reporting a gency’s reasonable policies and procedures to assure

maximum possible accuracy should be designed to detect.

Cf. Consent Order at ¶ 41, In re Hyundai Capital Am., 2022-CFPB-0005 (July 26, 2022) (“After furnishing the

correct origina l loa n a mount (a field that should not change), Respondent furnished increased amounts for the

“origina l loa n amount,” making it a ppear that a consumer had taken out a larger loa n than they had a ctually taken

out.”), https://files.consumerfinance.gov/f/documents/cfpb_hyundai-capital-america_consent-order_2022-07.pdf.

Bryant v. TRW, Inc., 487 F. Supp. 1234, 1242 (E.D. Mich. 1980) (refusing to set a side a jury verdict finding that a

consumer reporting a gency failed to follow rea sonable procedures under FCRA section 607(b) for failing to detect

inconsistencies between a September report containing derogatory inf ormation a nd a n earlier Ma y report on which

such information did not appear even though at least one of the derogatory items predated the May report).

The Date of First Delinquency herein refers to the date furnished to a credit reporting agency by a furnisher that

purportedly reflects the month and year on which the delinquency being reported in connection with a consumer’s

account commenced.

15 U.S.C. 1681c(a).

15 U.S.C. 1681c(a)(4), (c).

delinquency being reported commenced.

When accurate, that date corresponds with the start of

the time period that, once elapsed, precludes the delinquency from remaining on a consumer

report under FCRA section 605(a). A Date of First Delinquency that is more recent than the start

of a delinquency may lead a report user to believe a consumer had financial difficulty more

recently than is the case. Similarly, a Date of First Delinquency reflected on a report where a

consumer is not in fact delinquent could cause a user to inaccurately believe that the consumer is

delinquent. Examples of an illogical Date of First Delinquency may include:

• A Date of First Delinquency reported for an account whose records reflect no

delinquency, such as through activity reflecting a current account (complete history of

timely payments, $0 amount overdue) or through a current account status code;

• A Date of First Delinquency that post-dates a charge-off date; and

• A Date of First Delinquency, or date of last payment, that predates the account open date

(for non-collection accounts).

Illogical Information Relating to Consumers

A consumer reporting agency’s policies and procedures should also identify logical

inconsistencies in consumer information, such that, if included in a consumer report, some of the

information therein would necessarily be inaccurate. Such inconsistencies may include:

15 U.S.C. 1681s-2(a)(5)(A). Under the FCRA, furnishers must report a Date of First Delinquency within 90 days

of furnishing information rega rding delinquent a ccounts being placed for collection, charged to profit or loss, or

subjected to a ny sim ila r a ction. Id.

Cf. Consent Order at ¶ 36, In re Hyundai Capital Am., 2022-CFPB-0005 (July 26, 2022) (“Respondent furnished

account data showing that the consumer account was current, such as reporting $0 amount overdue or full payments

made timely each month, but then also furnished a [Date of First Delinquency], a field that inaccurately indicated

tha t the a ccount wa s in a n ongoing delinquency.”); Consent Order at ¶ 17, In re Santander Consumer USA Inc.,

2020-BCFP-0027 (Dec. 20, 2020) (a lleging Sa ntander violated FCRA § 623(a)(1)(A) by inaccurately furnishing

“internally inconsistent” data, including reporting “[Da te of First Delinquencies] for accounts that were current, paid

in full (and not delinquent immediately beforehand), or previously delinquent but subsequently became current”).

• Impossible information about consumers – for example, a tradeline that includes a

relevant date, such as a date of account opening, account closing, date of last payment, or

date of first delinquency, for an account that is in the future—an obvious impossibility—

or for an individual account that either predates that consumer’s listed date of birth or that

is so far in the past (e.g., January 1, 1800) that it must predate every living consumers’

date of birth, as individuals cannot open an account before they are born;

and

• Information about consumer accounts that is plainly inconsistent with other reported

information, such that one piece of information must be inaccurate – for example, if

every other tradeline is reporting ongoing payment activity, while one tradeline contains

a “deceased” indicator, reasonable policies and procedures should identify the

inconsistency and the consumer reporting agency should prevent the inclusion of the

inaccurate information in consumer reports it generates.

A consumer reporting agency’s policies, procedures and internal controls should further

identify and prevent reporting of illegitimate credit transactions for a minor. Minors generally

cannot legally enter into contracts for credit except in certain limited circumstances. It is

logically inconsistent when a credit transaction is reported for a person who lacks capacity to

enter into a contract because they are a minor, unless there are indicia that the credit transaction

is legitimate, such as in the context of student loans, credit card authorized users, or emancipated

See, e.g., Sheffer v. Experian Information Solutions, Inc., 2003 WL 21710573, at *2 (E.D. Pa. 2003) (referencing

a consumer report that “indicated both that Plaintiff was born in 1969 and that the account was opened in 1965” a s

one of two “inconsistencies” that “provide[d] a basis from which a jury could infer that the procedures were

unrea sonable”).

Gohman v. Equifax Information Services, LLC, 395 F. Supp. 2d 822, 827 (D. Minn. 2005); see also Sheffer, 2003

WL 21710573, at *2 (referencing the fact that only one account of approximately two dozen on a consumer’s report

included the “deceased” notation a s one of two “inconsistencies” that “provide[d] a basis from which a jury could

infer that the procedures were unreasonable”).

minors.

The Bureau is aware of evidence showing that instances of identity theft are especially

prevalent for minors, suggesting that identity thieves may target minors due to the value of

unused Social Security numbers and a belief that there is a lower probability of discovery of the

fraud.

This risk may be even more acute for minors in the United States foster care system,

who often lack a permanent address and frequently have their personal information shared

among numerous adults and agency databases, making them particularly susceptible to identity

theft and inaccurate credit history information.

This heightened risk faced by minors

underscores the importance for consumer reporting agencies to maintain procedures designed to

identify illegitimate credit transactions reported for minors and prevent inclusion thereof when

preparing consumer reports.

The Bureau is issuing this advisory opinion to remind consumer reporting agencies that

the failure to maintain reasonable procedures to screen for and eliminate logical inconsistencies,

to prevent the inclusion of facially false data in consumer reports, is a violation of their FCRA

obligation to “follow reasonable procedures to assure maximum possible accuracy” under

section 607(b) of the FCRA.

This exa m ple is consistent with prior Federal Tra de Commission (FTC)’s 40 Years Report. See FTC, 40 YEARS

OF EXPERIENCE WITH THE FAIR CREDIT REPORTING ACT (July 2011) [hereinafter, the “FTC 40 Years Report”],

available at

https://www.ftc.gov/sites/default/files/documents/reports/40-years-experience-fair-credit-reporting-act-

ftc-staff-report-summary-interpretations/110720fcrareport.pdf, at 68, comment 8 (“A [consumer reporting agency]

must maintain procedures to avoid reporting information with obvious logical inconsistencies, such as a credit

account opened when the consumer wa s known to be a minor.”). FTC staff published the 40 Years Report, an

updated compilation of past FTC interpretations of the FCRA, to coincide with the transfer of authority to the

Bureau. Effective July 21, 2011, the Dodd-Frank Act transferred rulemaking authority related to most of the FCRA

to the Bureau, giving the Bureau the primary regulatory and interpretive roles under the FCRA.

See, e.g., Richard Power, Carnegie Mellon CyLab, CHILD IDENTITY THEFT: NEW EVIDENCE INDICATES IDENTITY

THIEVES ARE TARGETING CHILDREN FOR UNUSED SOCIAL SECURITY NUMBERS (2011), available at

https://www.cylab.cmu.edu/_files/pdfs/reports/2011/child-identity-theft.pdf

See Consumer Fin. Prot. Bureau, “CFPB Releases Tools to Protect Foster Care Children from Credit Reporting

Problems” (May 1, 2014), available at

https://www.consumerfinance.gov/about-us/newsroom/cfpb-releases-tools-

to-protect-foster-care-children-from-credit-reporting-

errors/#:~:text=To%20submit%20a%20complaint%2C%20consumers,1%2D855%2D237%2D2392.

B. Coverage

This advisory opinion applies to all consumer reporting agencies as defined in FCRA

section 603(f).

C. Legal Analysis

Section 607(b) of the FCRA provides that “[w]henever a consumer reporting agency

prepares a consumer report it shall follow reasonable procedures to assure maximum possible

accuracy of the information concerning the individual about whom the report relates.”

The

Bureau has interpreted this requirement in section 607(b) to include as an integral component

that consumer reporting agencies implement and maintain reasonable screening procedures, such

as business rules, designed to identify and prevent the inclusion of facially false data, such as

logical inconsistencies relating to consumer or account information, in the consumer reports they

prepare.

Courts have spoken on this topic. For example, in Bryant v. TRW, Inc., the court rejected

a consumer reporting agency’s assertion that it had “no obligation” to compare facially

inconsistent information contained in two of plaintiff’s consumer reports from different months

because such an interpretation would make the consumer reporting agency “simply a conduit and

eliminate from the [FCRA] its emphasis on the reasonableness of the procedures followed in

putting together a consumer report,” contrary to Congressional intent.

Courts have also

15 U.S.C. 1681a(f).

15 U.S.C. 1681e(b).

See Bryant v. TRW, Inc., 487 F. Supp. at 1242. See also McKeown v. Sears Roebuck & Co., 335 F. Supp. 2d 917,

930 (W.D. Wis. 2004) (“[R]eceiving a pparently inconsistent credit reports may trigger a n obliga tion to investiga te

on the part of the credit reporting a gency . . . . [because] a llowing credit reporting agencies to act as nothing more

than mere conduits of information would eviscerate the act’s emphasis on reasonable compila tion procedures.”)

(citing Bryant, 487 F. Supp. at 1242); Wright v. Experian Info. Sols., Inc., 805 F.3d 1232, 1239 (10th Cir. 2015)

(“Courts have held [consumer reporting agencies] must look beyond information furnished to them when it is

inconsistent with the [consumer reporting agencies’] own records, contains a facial inaccuracy, or comes from an

unreliable source.”).

indicated that the inclusion of facially false data inaccuracies on a consumer report may, in

certain circumstances, evidence the unreasonableness of a consumer reporting agency’s

procedures.

It continues to be the Bureau’s interpretation as outlined in this advisory opinion that

such procedures are required, consistent with the core purpose of the FCRA as described in

FCRA section 602—i.e., to require consumer reporting agencies to adopt reasonable procedures

for meeting the needs of commerce for consumer credit, personnel, insurance, and other

information in a manner that is fair and equitable to the consumer with regard to accuracy,

among other responsibilities.

This interpretation also aligns with the Federal Trade

Commission’s 40 Years Report, which states that pursuant to 607(b), a consumer reporting

agency “must maintain procedures to avoid reporting information with obvious logical

inconsistencies, such as a credit account opened when the consumer was known to be a minor.”

In addition to provisions authorizing Federal and State enforcement,

the FCRA contains

two provisions relating to civil liability to consumers for noncompliance. Section 617 provides

that “any person who is negligent in failing to comply with any requirement imposed under this

title with respect to any consumer is liable to that consumer in an amount equal to” the

consumer’s actual damages, and costs and reasonable attorney’s fees.

Section 616 provides

that “any person who willfully fails to comply with any requirement imposed under this title with

respect to any consumer is liable to that consumer in an amount equal to” actual or statutory

damages of up to $1,000 per violation, such punitive damages as the court allows, and costs and

See Stewart v. Credit Bureau, Inc., 734 F.2d at 52; Sheffer, 2003 WL 21710573, a t *2.

15 U.S.C. 1681(b); see also Guimond, 45 F.3d at 1333.

FTC 40 Years Report, a t 68, co mment 8.

15 U.S.C. 1681s.

15 U.S.C. 1681o (emphasis added).

reasonable attorney’s fees.

A violation is willful when it is inconsistent with “authoritative

guidance” from a relevant agency.

As with any guidance issued by the CFPB on the FCRA, or

predecessor agencies that were responsible for administering the FCRA prior to the CFPB’s

creation, consumer reporting agencies risk liability under Section 616 if they violate the FCRA

in a manner described in this Advisory Opinion, regardless of whether the consumer reporting

agencies were previously liable for willful violations prior to its issuance.

II. Regulatory Matters

This advisory opinion is an interpretive rule issued under the Bureau’s authority to

interpret the FCRA, including under section 1022(b)(1) of the Dodd-Frank Wall Street Reform

and Consumer Protection Act,

which authorizes guidance as may be necessary or appropriate

to enable the Bureau to administer and carry out the purposes and objectives of Federal

consumer financial laws.

The Bureau has determined that this advisory opinion does not impose any new or revise

any existing recordkeeping, reporting, or disclosure requirements on covered entities or members

of the public that would be collections of information requiring approval by the Office of

Management and Budget under the Paperwork Reduction Act.

Pursuant to the Congressional Review Act,

the Bureau will submit a report containing

this interpretive rule and other required information to the United States Senate, the United

States House of Representatives, and the Comptroller General of the United States prior to the

15 U.S.C. 1681n (emphasis added); Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 57-58 (2007) (construing

mea ning of “willful”).

Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 70 (2007); Fuges v. Sw. Fin. Servs., Ltd., 707 F.3d 241, 253 (3d Cir.

2012).

Dodd-Fra nk Wa ll Street Reform a nd Consumer Protection Act, Pub. L. 111-203, 124 Stat. 1376 (2010).

12 U.S.C. 5512(b)(1).

4 U.S.C. 3501-3521.

5 U.S.C. 801 et seq.

rule’s published effective date. The Office of Information and Regulatory Affairs has designated

this interpretive rule as not a “major rule” as defined by 5 U.S.C. 804(2).

Rohit Chopra,

Director, Consumer Financial Protection Bureau.