Changes To Fair Credit Reporting Act

The Fair Credit Reporting Act requires users of credit reports to provide a “Summary of Consumer Rights” notice to consumers in certain limited circumstances, such as before taking adverse action based on a credit report for employment purposes.

The Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018 amended the Fair Credit Reporting Act to require, among other changes, that certain language be added to the Summary of Consumer Rights notice regarding a new security freeze right that the law provides to consumers.  The new change took effect on September 21, 2018.  Dealers should consult with their legal counsel concerning the requirement to issue the Summary of Consumer Rights notice and should also consult with their provider of this notice to ensure it includes the changes brought about by the new law. The duties of employers who use credit reports for employment purposes is further explained in the FTC publication Using Consumer Reports: What Employers Need to Know, which contains a link to a Summary of Rights notice.

Please also see FTC Issues Guidance to Businesses Regarding New Credit Freeze Law explaining free credit freezes and year-long fraud alerts. Security freezes, also known as credit freezes, restrict access to a consumer’s credit file, making it harder for identity thieves to open new accounts in the consumer’s name. Starting September 21, consumers can freeze and unfreeze their credit file for free. They also can get free freezes for their children.

If you have questions, please contact NADA’s Paul Metrey at pmetrey@nada.org.