Most of the human resources world is familiar with the Fair Credit Reporting Act (FCRA) as it relates to the background screening process. But are you aware of which agency oversees the FCRA? Historically, the Federal Trade Commission was responsible for interpreting FCRA rules and forms. Recent legislation has transferred that role to another agency, and is making way for changes effective January 1, 2013.
The Dodd-Frank Wall Street Reform and Consumer Protection Act transferred rulemaking authority for the FCRA to the newly-created Consumer Financial Protection Board (CFPB). The CFPB has now become the agency primarily responsible for interpreting the FCRA.
First among the mandates for the new agency, CFPB has modified the following forms:
- Summary of Consumer Rights under the FCRA – This is the standard notice to be used by Credit Reporting Agencies (CRAs) and employers. CRAs must provide this form to employers, and employers must in turn provide this form to applicants and employees when such individuals will be subject to a consumer report or when a pre-adverse action notice is sent to the applicant or employee.
- Notice to Users of Consumer Reports of their Obligations under the FCRA—The FCRA requires that CRAs provide employer clients or users with a copy of this notice.
- Notice to Furnishers of Information of their Obligations under the FCRA—The FCRA requires that CRAs provide this notice to certain furnishers of information in specific situations.
The main difference between the old forms and the new forms is informing consumers may now obtain information about their rights under the FCRA from the CFPB, instead of the FTC.
Given the recent and ongoing changes to these regulations, and their impacts at the local, state and federal level, employers are encouraged to stay abreast of changes to the FCRA, and begin using the new forms by the new year.