H.R. 2622 (108th): Fair and Accurate Credit Transactions Act of 2003

108th Congress, 2003–2004. Text as of Sep 04, 2003 (Reported by House Committee).

Status & Summary | PDF | Source: GPO

HR 2622 RH

Union Calendar No. 150

108th CONGRESS

1st Session

H. R. 2622

[Report No. 108-263]

To amend the Fair Credit Reporting Act, to prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, make improvements in the use of, and consumer access to, credit information, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

June 26, 2003

Mr. BACHUS (for himself, Ms. HOOLEY of Oregon, Mrs. BIGGERT, Mr. MOORE, Mr. LATOURETTE, Mr. KANJORSKI, Mr. CASTLE, Mrs. MALONEY, Mr. SHADEGG, Mr. FORD, Mr. TIBERI, Mr. HINOJOSA, Mr. HENSARLING, Mr. CROWLEY, Mr. SESSIONS, Mr. ROSS, Mr. MATHESON, Mr. DAVIS of Alabama, Mr. BAKER, Mr. KING of New York, Mr. LUCAS of Oklahoma, Mr. LUCAS of Kentucky, Mr. NEY, Mrs. KELLY, Mr. JONES of North Carolina, Mr. ISRAEL, Ms. HART, Mr. MILLER of North Carolina, Mrs. CAPITO, Mrs. MCCARTHY of New York, Mr. BARRETT of South Carolina, Mr. FEENEY, and Ms. HARRIS) introduced the following bill; which was referred to the Committee on Financial Services

September 4, 2003

Additional sponsors: Mr. KENNEDY of Minnesota, Mr. SCOTT of Georgia, Mr. BOYD, Mr. WELDON of Florida, Mr. ROGERS of Michigan, Mr. FROST, Mr. RAMSTAD, Mr. MURPHY, Mr. SMITH of Washington, Mr. CANTOR, Mr. BLUNT, Mr. ADERHOLT, Mr. TERRY, Mr. DAVIS of Florida, Mr. MICA, Mr. SHAYS, Mr. STRICKLAND, Mr. BURTON of Indiana, Mr. KIND, Mr. DEAL of Georgia, Mr. SCHROCK, Mr. REYNOLDS, Ms. PRYCE of Ohio, Mr. EMANUEL, Mr. BEAUPREZ, and Mr. BOEHLERT

September 4, 2003

Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in italic]

[For text of introduced bill, see copy of bill as introduced on June 26, 2003]


A BILL

To amend the Fair Credit Reporting Act, to prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, make improvements in the use of, and consumer access to, credit information, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) SHORT TITLE- This Act may be cited as the ‘Fair and Accurate Credit Transactions Act of 2003’.

    (b) TABLE OF CONTENTS- The table of contents for this Act are as follows:

      Sec. 1. Short title; table of contents.

      Sec. 2. Definitions.

      Sec. 3. Effective dates.

TITLE I--UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS

      Sec. 101. Uniform national consumer protection standards made permanent.

TITLE II--IDENTITY THEFT PREVENTION

      Sec. 201. Investigating changes of address and inactive accounts.

      Sec. 202. Fraud alerts.

      Sec. 203. Truncation of credit card and debit card account numbers.

      Sec. 204. Summary of rights of identity theft victims.

      Sec. 205. Blocking of information resulting from identity theft.

      Sec. 206. Establishment of procedures for depository institutions to identify possible instances of identity theft.

      Sec. 207. Study on the use of technology to combat identity theft.

TITLE III--IMPROVING RESOLUTION OF CONSUMER DISPUTES

      Sec. 301. Coordination of consumer complaint investigations.

      Sec. 302. Notice of dispute through reseller.

      Sec. 303. Reasonable investigation required.

      Sec. 304. Duties of furnishers of information.

      Sec. 305. Prompt investigation of disputed consumer information.

TITLE IV--IMPROVING ACCURACY OF CONSUMER RECORDS

      Sec. 401. Reconciling addresses.

      Sec. 402. Prevention of repollution of consumer reports.

      Sec. 403. Notice by users with respect to fraudulent information.

      Sec. 404. Disclosure to consumers of contact information for users and furnishers of information in consumer reports.

      Sec. 405. FTC study of the accuracy of consumer reports.

TITLE V--IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT INFORMATION

      Sec. 501. Free reports annually.

      Sec. 502. Disclosure of credit scores.

      Sec. 503. Simpler and easier method for consumers to use notification system.

      Sec. 504. Requirement to disclose communications to a consumer reporting agency.

      Sec. 505. Study of effects of credit scores and credit-based insurance scores on availability and affordability of financial products.

      Sec. 506. GAO study on disparate impact of credit system.

      Sec. 507. Analysis of further restrictions on offers of credit or insurance.

      Sec. 508. Study on the need and the means for improving financial literacy among consumers.

      Sec. 509. Disclosure of increase in APR under certain circumstances.

TITLE VI--PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS

      Sec. 601. Certain employee investigation communications excluded from definition of consumer report.

TITLE VII--LIMITING THE USE AND SHARING OF MEDICAL INFORMATION IN THE FINANCIAL SYSTEM

      Sec. 701. Protection of medical information in the financial system.

      Sec. 702. Confidentiality of medical information in credit reports.

SEC. 2. DEFINITIONS.

    Section 603 of the Fair Credit Reporting Act (15 U.S.C. 1681a) is amended by adding at the end the following new subsections:

    ‘(r) RESELLER- The term ‘reseller’ means a consumer reporting agency that--

      ‘(1) assembles and merges information contained in the database of another consumer reporting agency or multiple consumer reporting agencies concerning any consumer for purposes of furnishing such information to any third party, to the extent of such activities; and

      ‘(2) does not maintain a database of the assembled or merged information from which new consumer reports are produced.

    ‘(s) OTHER DEFINITIONS-

      ‘(1) BOARD; CREDIT; CREDITOR; CREDIT CARD- The terms ‘Board’, ‘credit’, ‘creditor’, and ‘credit card’ have the same meanings as in section 103 of the Truth in Lending Act.

      ‘(2) COMMISSION- The term ‘Commission’ means the Federal Trade Commission.

      ‘(3) DEBIT CARD- The term ‘debit card’ means any card issued by a financial institution to a consumer for use in initiating electronic fund transfers (as defined in section 903(6) of the Electronic Fund Transfer Act) from the account (as defined in such Act) of the consumer at such financial institution for the purpose of transferring money between accounts or obtaining money, property, labor, or services.

      ‘(4) ELECTRONIC FUND TRANSFER- The term ‘electronic fund transfer’ has the same meaning as in section 903 of the Electronic Fund Transfer Act.

      ‘(5) FEDERAL BANKING AGENCY- The term ‘Federal banking agency’ has the same meaning as in section 3 of the Federal Deposit Insurance Act.

      ‘(6) IDENTITY THEFT- The term ‘identity theft’ means a fraud committed using another person’s identifying information, subject to such further definition as the Commission and the Board may prescribe, jointly, by regulation.

      ‘(7) POLICE REPORT- The term ‘police report’ means a copy of any official valid report filed by a consumer with any appropriate Federal, State, or local government law enforcement agency, or any comparable official government document that the Board and the Commission shall jointly prescribe in regulations, that is subject to a criminal penalty for false statements.’.

SEC. 3. EFFECTIVE DATES.

    (a) IN GENERAL- Except as provided in subsections (b) and (c)--

      (1) before the end of the 2-month period beginning on the date of the enactment of this Act, the Board of Governors of the Federal Reserve System and the Federal Trade Commission shall jointly prescribe regulations in final form establishing effective dates for each provision of this Act (except as otherwise specified); and

      (2) the regulations prescribed under paragraph (1) shall establish effective dates that are as early as possible while allowing a reasonable time for the implementation of the provisions of this Act, but in no case shall the effective date be later than 10 months after the date of issuance of such regulations in final form.

    (b) IMMEDIATE EFFECTIVE DATE- The following provisions shall take effect on the date of the enactment of this Act:

      (1) Title I.

      (2) Section 201.

      (3) Section 609(d)(1) of the Fair Credit Reporting Act (as added by the amendment in section 204(a)).

      (4) Section 305.

      (5) Section 505.

      (6) Section 506.

      (7) Title VI.

    (c) EFFECTIVE DATE FOR PROTECTION OF MEDICAL INFORMATION IN THE FINANCIAL SYSTEM- Section 701 shall take effect at the end of the 180-day period beginning on the date of the enactment of this Act, except that paragraph (2) of section 604(g) of the Fair Credit Reporting Act (as added by section 701) shall take effect on the later of--

      (1) the end of the 90-day period beginning on the date the regulations required under paragraph (5)(B) of such section 604(g) (as added by section 701) are prescribed in final form; or

      (2) the date specified in the regulations referred to in paragraph (1).

TITLE I--UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS

SEC. 101. UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS MADE PERMANENT.

    Section 624(d) of the Fair Credit Reporting Act (15 U.S.C. 1681t(d)) is amended--

      (1) by striking ‘Subsections (b) and (c)’ and all that follows through ‘do not affect any settlement,’ and inserting ‘Subsections (b) and (c) do not affect any settlement,’; and

      (2) by striking ‘Consumer Credit Reporting Reform Act of 1996’ and all that follows through the period at the end of paragraph (2) and inserting ‘Consumer Credit Reporting Reform Act of 1996.’.

TITLE II--IDENTITY THEFT PREVENTION

SEC. 201. INVESTIGATING CHANGES OF ADDRESS AND INACTIVE ACCOUNTS.

    (a) IN GENERAL- Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by inserting after subsection (f), the following new subsection:

    ‘(g) ‘RED FLAG’ PATTERNS OF POSSIBLE IDENTITY THEFT-

      ‘(1) INVESTIGATION OF CHANGES OF ADDRESS- The Federal banking agencies and the National Credit Union Administration, in carrying out the responsibilities of such agencies and Administration under subsection (k), shall jointly prescribe regulations for credit card and debit card issuers to ensure that, if any such issuer receives a request for an additional or replacement card for an existing account within a short period of time after the issuer has received notification of a change of address for the same account, the issuer will follow reasonable policies and procedures that require, as appropriate, that the issuer not issue the additional or replacement card unless the issuer--

        ‘(A) notifies the cardholder of the request at the former address of the cardholder and provides

to the cardholder a means of promptly reporting incorrect address changes;

        ‘(B) notifies the cardholder of the request by such other means of communication as the cardholder and the card issuer previously agreed to; or

        ‘(C) uses other means of assessing the validity of the change of address, in accordance with reasonable policies and procedures established by the card issuer in accordance with the regulations prescribed under subsection (k).

      ‘(2) INACTIVE ACCOUNTS- The Federal banking agencies and the National Credit Union Administration, in carrying out the responsibilities of such agencies and Administration under subsection (k), shall consider including, as a possible ‘red flag’ pattern, reasonable guidelines providing that when a transaction occurs with respect to a credit or deposit account that has been inactive for more than 2 years, the creditor or depository institution shall follow reasonable policies and procedures that provide for notice to be given to a consumer in a manner reasonably designed to reduce the likelihood of identity theft with respect to such account.’.

    (b) CLERICAL AMENDMENTS-

      (1) The heading for section 605 of the Fair Credit Reporting Act is amended to read as follows:

‘Sec. 605. Requirements relating to information contained in consumer reports and to identity theft prevention.’.

      (2) The table of sections for title VI of the Consumer Credit Protection Act is amended by striking the item relating to section 605 and inserting the following new item:

      ‘605. Requirements relating to information contained in consumer reports and to identity theft prevention.’.

      (3) Section 624(b)(1)(E) of the Fair Credit Reporting Act (15 U.S.C. 1681t(b)(1)(E)) is amended by inserting ‘and to identity theft prevention’ after ‘consumer reports’.

SEC. 202. FRAUD ALERTS.

    Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by adding at the end the following new subsection:

    ‘(i) ONE-CALL FRAUD ALERTS-

      ‘(1) INITIAL ALERTS- Upon the direct request of a consumer, or an individual acting on behalf of or as a personal representative of a consumer, who asserts, in good faith, a suspicion that the consumer has been or is about to become a victim of fraud or related crime, including identity theft, a consumer reporting agency described in section 603(p) shall, if the agency maintains a file on the consumer who is making the request and has a reasonable belief that the agency knows the identity of the consumer--

        ‘(A) include a fraud alert in the file of that consumer for a period of not less than 90 days beginning on the date of such request, unless the consumer specifically requests that such fraud alert be removed before the end of such period;

        ‘(B) disclose to the consumer that the consumer may request a free copy of the file of the consumer and provide the consumer, upon request, a free disclosure of the consumer’s file (as described in section 609(a)) within 3 business days after such request;

        ‘(C) for 2 years after the date of such request, exclude the consumer from any list of consumers prepared by the agency and provided to any third party to offer credit or insurance to the consumer as part of a transaction that was not initiated by the consumer, unless the consumer subsequently requests that such exclusion be rescinded before the end of such period; and

        ‘(D) refer the information regarding the fraud alert to each of the other consumer reporting agencies described in section 603(p), as required under section 621(f)(1).

      ‘(2) EXTENDED ALERTS- Upon the direct request of a consumer, or an individual acting on behalf of or as a personal representative of a consumer, who contacts a consumer reporting agency described in section 603(p) to report details of an identity theft and submits evidence that provides the agency with reasonable cause to believe that such identity theft has occurred, the agency shall, if the agency maintains a file on the consumer who is making the request and has a reasonable belief that the agency knows the identity of the consumer--

        ‘(A) include a fraud alert in the file of that consumer and provide an opportunity for the consumer to extend the alert for a period of up to 7 years from the date of such request, unless the consumer subsequently requests that such fraud alert be removed before the end of such period;

        ‘(B) provide the consumer with the option of including more complete information in the consumer’s file, including a telephone number or some other reasonable means of communication that any person who requests the consumer’s report may utilize for authorization before establishing a new credit plan in the name of the consumer; and

        ‘(C) provide the consumer with at least 2 free disclosures of the information described in section 609(a) during the 12-month period beginning on the date of such request.

      ‘(3) ACTIVE DUTY ALERTS- Upon the direct request of an active duty military consumer, or an individual acting on behalf of or as a personal representative of an active duty military consumer, who contacts a consumer reporting agency described in section 603(p), the agency shall, if the agency maintains a file on the consumer who is making the request and has a reasonable belief that the agency knows the identity of the consumer--

        ‘(A) include an active duty alert in the file of that consumer during a period of not less than 12 months beginning on the date of the request, unless the consumer requests that such active duty alert be removed before the end of such period;

        ‘(B) for 2 years after the date of such request, exclude the consumer from any list of consumers prepared by the agency and provided to any third party to offer credit or insurance to the consumer as part of a transaction that was not initiated by the consumer, unless the consumer subsequently requests that such exclusion be rescinded before the end of such period; and

        ‘(C) refer the information regarding the active duty alert to each of the other consumer reporting agencies described in section 603(p), as required under section 621(f)(1).

      ‘(4) PROCEDURES- Each consumer reporting agency described in section 603(p) shall establish policies and procedures to comply with the obligations of paragraphs (1), (2), and (3), including procedures that allow consumers to request initial, extended, or active duty alerts in a simple and easy manner, including by telephone.

      ‘(5) NOTICE TO USERS- No person who obtains any information that includes a fraud alert under this section from a file of any consumer from a consumer reporting agency may establish a new credit plan in the name of the consumer for a person other than the consumer without utilizing reasonable policies and procedures described in paragraph (9).

      ‘(6) REFERRALS OF FRAUD ALERTS- Each consumer reporting agency described in section 603(p)

that receives a referral of a fraud alert from another such agency pursuant to paragraph (1)(D) or (3)(C) shall follow the procedures required under subparagraphs (A), (B), and (C) of paragraph (1), in the case of a referral under paragraph (1)(D), and subparagraphs (A) and (B), in the case of a referral under paragraph (3)(C), as if the agency received the request from the consumer directly.

      ‘(7) DUTY OF RESELLER TO RECONVEY ALERT- A reseller that is notified of the existence of a fraud alert in a consumer’s consumer report shall communicate to each person procuring a consumer report with respect to such consumer the existence of a fraud alert in effect for such consumer.

      ‘(8) DUTY OF OTHER CONSUMER REPORTING AGENCIES TO PROVIDE CONTACT INFORMATION- If a consumer contacts any consumer reporting agency that is not a consumer reporting agency described in section 603(p) to communicate a suspicion that the consumer has been or is about to become a victim of fraud or related crime, including identity theft, the agency shall provide the consumer with information on how to contact the Commission and the consumer reporting agencies described in section 603(p) to obtain more detailed information and request alerts under this subsection.

      ‘(9) FRAUD ALERT-

        ‘(A) DEFINITION- For purposes of this subsection, the term ‘fraud alert’ means, at a minimum, a statement--

          ‘(i) in the file of a consumer that the consumer may be a victim of fraud, including identity theft, or is a consumer described in paragraph (3); and

          ‘(ii) that is transmitted in a manner that facilitates a clear and conspicuous view of the statement by any person requesting such file.

        ‘(B) OTHER INFORMATION- A fraud alert shall include information that notifies all prospective users of a consumer report on the consumer to which the alert relates that the consumer does not authorize establishing any new credit plan in the name of the consumer, unless the user utilizes reasonable policies and procedures to form a reasonable belief that the user knows the identity of the person for whom such new plan is established, which may include obtaining authorization or preauthorization of the consumer at a telephone number designated by the consumer or by such other reasonable means agreed to.

      ‘(10) OTHER DEFINITIONS- For purposes of this subsection, the following definitions shall apply:

        ‘(A) ACTIVE DUTY MILITARY CONSUMER- The term ‘active duty military consumer’ means a consumer in military service who--

          ‘(i) is on active duty (as defined in section 101(d)(1) of title 10, United States Code) or is a reservist performing duty under a call or order to active duty under a provision of law referred to in section 101(a)(13) of title 10, United States Code; and

          ‘(ii) is assigned to service away from the consumer’s usual duty station.

        ‘(B) NEW CREDIT PLAN- The term ‘new credit plan’ means a new account under an open end credit plan (as defined in section 103(i) of this Act) or a new credit transaction not under an open end credit plan.’.

SEC. 203. TRUNCATION OF CREDIT CARD AND DEBIT CARD ACCOUNT NUMBERS.

    (a) IN GENERAL- Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by inserting after subsection (k) (as added by section 206 of this title) the following new subsection:

    ‘(l) TRUNCATION OF CREDIT CARD AND DEBIT CARD ACCOUNT NUMBERS-

      ‘(1) IN GENERAL- Except as provided in this subsection, no person that accepts credit cards or debit cards for the transaction of business shall print the expiration date or more than the last 5 digits of the card number upon any receipt provided to the cardholder at the point of the sale or transaction.

      ‘(2) LIMITATION- This section shall apply only to receipts that are electronically printed, and shall not apply to transactions in which the sole means of recording the person’s credit card or debit card number is by handwriting or by an imprint or copy of the card.’.

    (b) EFFECTIVE DATE- The amendments made by subsection (a) shall apply after the end of--

      (1) the 3-year period beginning on the date of the enactment of this Act, with respect to any cash register or other machine or device that electronically

prints receipts for credit card or debit card transactions that is in use before January 1, 2005; and

      (2) the 1-year period beginning on the date of the enactment of this Act, with respect to any cash register or other machine or device that electronically prints receipts for credit card or debit card transactions that is first put into use on or after January 1, 2005.

SEC. 204. SUMMARY OF RIGHTS OF IDENTITY THEFT VICTIMS.

    (a) IN GENERAL- Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681g) is amended by adding at the end the following new subsection:

    ‘(d) SUMMARY OF RIGHTS OF IDENTITY THEFT VICTIMS-

      ‘(1) IN GENERAL- The Commission, in consultation with the Federal banking agencies and the National Credit Union Administration, shall prepare a model summary of the rights of consumers under this title with respect to the procedures for remedying the effects of fraud or identity theft involving credit, electronic fund transfers, or accounts or transactions at or with a financial institution.

      ‘(2) SUMMARY OF RIGHTS AND CONTACT INFORMATION- If any consumer contacts a consumer reporting agency and expresses a belief that the consumer is a victim of fraud or identity theft involving credit, electronic fund transfers, or accounts or transactions at or with a financial institution, the consumer reporting agency shall, in addition to any other action the agency may take, provide the consumer with the model summary of rights prepared by the Commission under paragraph (1) and information on how to contact the Commission to obtain more detailed information.’.

    (b) TECHNICAL AND CONFORMING AMENDMENT- Section 624(b)(3) of the Fair Credit Reporting Act (15 U.S.C. 1681t(b)(3)) is amended by striking ‘section 609(c)’ and inserting ‘subsection (c) or (d) of section 609’.

SEC. 205. BLOCKING OF INFORMATION RESULTING FROM IDENTITY THEFT.

    Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by inserting after subsection (i) (as added by section 202 of this title) the following new subsection:

    ‘(j) BLOCK OF INFORMATION RESULTING FROM IDENTITY THEFT-

      ‘(1) BLOCK- Except as provided in paragraph (3), a consumer reporting agency shall block the reporting of any information in the file of a consumer that the consumer identifies as information that resulted from an alleged identity theft and confirms is not information relating to any transaction by the consumer not later than 5 business days after the date of receipt by such agency of--

        ‘(A) appropriate proof of the identity of a consumer;

        ‘(B) a police report evidencing the claim of the consumer of identity theft;

        ‘(C) the identification of the information by the consumer; and

        ‘(D) confirmation by the consumer that the information is not information relating to any transaction by the consumer.

      ‘(2) NOTIFICATION- A consumer reporting agency shall promptly notify the furnisher of information identified by the consumer under paragraph (1)--

        ‘(A) that the information may be a result of identity theft;

        ‘(B) that a police report has been filed;

        ‘(C) that a block has been requested under this subsection; and

        ‘(D) of the effective date of the block.

      ‘(3) AUTHORITY TO DECLINE OR RESCIND-

        ‘(A) IN GENERAL- A consumer reporting agency may decline to block, or may rescind any block, of consumer information under this subsection if the consumer reporting agency reasonably determines that--

          ‘(i) the information was blocked in error or a block was requested by the consumer in error;

          ‘(ii) the information was blocked, or a block was requested by the consumer, on the basis of a misrepresentation of fact by the consumer relevant to the request to block; or

          ‘(iii) the consumer knowingly obtained possession of goods, services, or moneys as a result of the blocked transaction or transactions, or the consumer should have known that the consumer obtained possession of goods, services, or moneys as a result of the blocked transaction or transactions.

        ‘(B) NOTIFICATION TO CONSUMER- If the block of information is declined or rescinded under this paragraph, the affected consumer shall be notified promptly, in the same manner as consumers are notified of the reinsertion of information under section 611(a)(5)(B).

        ‘(C) SIGNIFICANCE OF BLOCK- For purposes of this paragraph, if a consumer reporting agency rescinds a block, the presence of information in the file of a consumer prior to the blocking of such information is not evidence of whether the consumer knew or should have known that the consumer obtained possession of any goods, services, or monies as a result of the block.

      ‘(4) EXCEPTIONS-

        ‘(A) VERIFICATION COMPANIES- This subsection shall not apply to--

          ‘(i) a check services company, which issues authorizations for the purpose of approving or processing negotiable instruments, electronic funds transfers, or similar methods of payments; or

          ‘(ii) a deposit account information service company, which issues reports regarding account closures due to fraud, substantial overdrafts, automated teller machine abuse, or similar negative information regarding a consumer, to inquiring banks or other financial institutions for use only in reviewing a consumer request for a deposit account at the inquiring bank or financial institution.

        ‘(B) RESELLERS-

          ‘(i) NO RESELLER FILE- This subsection shall not apply to a consumer reporting agency if the consumer reporting agency--

            ‘(I) is a reseller;

            ‘(II) is not, at the time of the request of the consumer under paragraph (1), otherwise furnishing or reselling a consumer report concerning the information identified by the consumer; and

            ‘(III) informs the consumer, by any means, that the consumer may report the identity theft to the Commission to obtain consumer information regarding identity theft.

          ‘(ii) RESELLER WITH FILE- The sole obligation of the consumer reporting agency under this subsection, with regard to any request of a consumer under this subsection, shall be to block the consumer report maintained by the consumer reporting agency from any subsequent use if--

            ‘(I) the consumer, in accordance with the provisions of paragraph (1), identifies, to a consumer reporting agency, information in the file of the consumer that resulted from identity theft; and

            ‘(II) the consumer reporting agency is a reseller of the identified information.

          ‘(iii) NOTICE- In carrying out its obligation under clause (ii), the reseller shall promptly provide a notice to the consumer of the decision to block the file. Such notice shall contain the name, address, and telephone number of each consumer reporting agency from which the

consumer information was obtained for resale.

      ‘(5) ACCESS TO BLOCKED INFORMATION BY LAW ENFORCEMENT AGENCIES- No provision of this subsection shall be construed as requiring a consumer reporting agency to prevent a Federal, State, or local law enforcement agency from accessing blocked information in a consumer file to which the agency could otherwise obtain access under this title.’.

SEC. 206. ESTABLISHMENT OF PROCEDURES FOR DEPOSITORY INSTITUTIONS TO IDENTIFY POSSIBLE INSTANCES OF IDENTITY THEFT.

    (a) IN GENERAL- Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by inserting after subsection (j) (as added by section 205 of this title) the following new subsection:

    ‘(k) ‘RED FLAG’ GUIDELINES REQUIRED-

      ‘(1) IN GENERAL- The Federal banking agencies and the National Credit Union Administration, in consultation with the Commission, shall jointly establish and maintain guidelines for use by insured depository institutions in identifying patterns, practices, and specific forms of activity that indicate the possible existence of identity theft with respect to accounts, and update such guidelines as often as necessary.

      ‘(2) REGULATIONS- The Federal banking agencies and the National Credit Union Administration, in consultation with the Commission, shall jointly prescribe regulations requiring insured depository institutions to establish and adhere to reasonable policies and procedures for implementing the guidelines established pursuant to paragraph (1) to identify possible risks to customer accounts or to the safety and soundness of the institutions.

      ‘(3) CONSISTENCY WITH VERIFICATION REQUIREMENTS- Policies and procedures established pursuant to paragraph (2) shall not be inconsistent with, or duplicative of, the policies and procedures required under section 5318(l) of title 31, United States Code.

      ‘(4) INSURED DEPOSITORY INSTITUTION DEFINED- For purposes of this subsection, the term ‘insured depository institution’--

        ‘(A) has the meaning given to such term in section 3 of the Federal Deposit Insurance Act; and

        ‘(B) includes an insured credit union (as defined in section 101 of the Federal Credit Union Act).’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect at the end of the 1-year period beginning on the date of the enactment of this Act.

SEC. 207. STUDY ON THE USE OF TECHNOLOGY TO COMBAT IDENTITY THEFT.

    (a) STUDY REQUIRED- The Secretary of the Treasury shall conduct a study of the use of biometrics and other similar technologies to reduce the incidence and costs of identity theft by providing convincing evidence of who actually performed a given financial transaction.

    (b) CONSULTATION- The Secretary of the Treasury shall consult with Federal banking agencies, the Federal Trade Commission, and representatives of financial institutions, credit reporting agencies, Federal, State, and local government agencies that issue official forms or means of identification, State prosecutors, law enforcement agencies, and the biometric industry and other representatives of the general public, in formulating and conducting the study required by subsection (a).

    (c) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to the Secretary of the Treasury for fiscal year 2004 such sums as may be necessary to carry out the provisions of this section.

    (d) REPORT REQUIRED- Before the end of the 180-day period beginning on the date of the enactment of this Act, the Secretary shall submit a report to Congress containing the findings and conclusions of the study required under subsection (a), together with such recommendations for legislative or administrative actions as may be appropriate.

TITLE III--IMPROVING RESOLUTION OF CONSUMER DISPUTES

SEC. 301. COORDINATION OF CONSUMER COMPLAINT INVESTIGATIONS.

    Section 621 of the Fair Credit Reporting Act (15 U.S.C. 1681s) is amended by adding at the end the following new subsection:

    ‘(f) COORDINATION OF CONSUMER COMPLAINT INVESTIGATIONS-

      ‘(1) IN GENERAL- The consumer reporting agencies described in section 603(p) shall develop and maintain procedures for the referral, to each such agency, of any consumer complaint received by any such agency alleging any identity theft or requesting a block or a fraud alert.

      ‘(2) MODEL FORM AND PROCEDURE FOR REPORTING IDENTITY THEFT- The Commission, in consultation with the Federal banking agencies and the National Credit Union Administration, shall develop a model form and model procedures to be used by consumers who are victims of identity theft for contacting and informing creditors and consumer reporting agencies of the fraud.

      ‘(3) ANNUAL SUMMARY REPORTS- Each consumer reporting agency described in section 603(p) shall submit an annual summary report to the Commission on consumer complaints received by the agency on identity theft or fraud alerts.’.

SEC. 302. NOTICE OF DISPUTE THROUGH RESELLER.

    (a) REQUIREMENT FOR REINVESTIGATION OF DISPUTED INFORMATION UPON NOTICE FROM A RESELLER- Section 611(a) of the Fair Credit Reporting Act (15 U.S.C. 1681i(a)(1)(A)) is amended--

      (1) in subparagraph (A) of paragraph (1)--

        (A) by striking ‘If the completeness’ and inserting ‘Subject to subsection (e), if the completeness’;

        (B) by inserting ‘, or indirectly through a reseller,’ after ‘notifies the agency directly’; and

        (C) by inserting ‘or reseller’ before the period at the end of such subparagraph;

      (2) in subparagraph (A) of paragraph (2)--

        (A) by inserting ‘or a reseller’ after ‘dispute from any consumer’; and

        (B) by inserting ‘or reseller’ before the period at the end of such subparagraph; and

      (3) in subparagraph (B) of paragraph (2), by inserting ‘or the reseller’ after ‘from the consumer’.

    (b) REINVESTIGATION REQUIREMENT APPLICABLE TO RESELLERS- Section 611 of the Fair Credit Reporting Act (15 U.S.C. 1681i) is amended by adding at the end the following new subsection:

    ‘(e) REINVESTIGATION REQUIREMENT APPLICABLE TO RESELLERS-

      ‘(1) EXEMPTION FROM GENERAL REINVESTIGATION REQUIREMENT- Except as provided in paragraph (2), a reseller shall be exempt from the requirements of this section.

      ‘(2) ACTION REQUIRED UPON RECEIVING NOTICE OF A DISPUTE- If a reseller receives a notice from a consumer of a dispute concerning the completeness or accuracy of any item of information contained in a consumer report on such consumer produced by the reseller, the reseller shall, within 5 business days of receiving the notice and free of charge--

        ‘(A) determine whether the item of information is incomplete or inaccurate as a result of an act or omission of the reseller; and

        ‘(B) if--

          ‘(i) the reseller determines that the item of information is incomplete or inaccurate as a result of an act or omission of the reseller, correct the information in the consumer report or delete it; or

          ‘(ii) if the reseller determines that the item of information is not incomplete or inaccurate as a result of an act or omission of the reseller, convey the notice of the dispute, together with all relevant information provided by the consumer, to each consumer reporting agency that provided the reseller with the information that is the subject of the dispute.

      ‘(3) RESELLER REINVESTIGATIONS- No provision of this subsection shall be construed as prohibiting a reseller from conducting a reinvestigation of a consumer dispute directly.’.

    (c) TECHNICAL AND CONFORMING AMENDMENT- The heading for paragraph (2)(B) of section 611(a) of the Fair Credit Reporting Act (15 U.S.C. 1681i(a)(2)(B)) is amended by striking ‘FROM CONSUMER’.

SEC. 303. REASONABLE REINVESTIGATION REQUIRED.

    Section 611(a)(1)(A) of the Fair Credit Reporting Act (15 U.S.C. 1681i(a)(1)(A)) is amended by striking ‘shall reinvestigate free of charge’ and inserting ‘shall, free of charge, conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate’.

SEC. 304. DUTIES OF FURNISHERS OF INFORMATION.

    (a) IN GENERAL- Section 623(a) of the Fair Credit Reporting Act (15 U.S.C. 1681s-2(a)) is amended--

      (1) in paragraph (1)(A), by striking ‘knows or consciously avoids knowing that the information is inaccurate’ and inserting ‘knows or has reasonable cause to believe that the information is inaccurate’;

      (2) in paragraph (1)--

        (A) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively;

        (B) by inserting after subparagraph (A), the following new subparagraph:

        ‘(B) REASONABLE PROCEDURES TO ENSURE ACCURACY- A person that regularly furnishes information relating to consumers to a consumer reporting agency described in section 603(p) shall maintain reasonable procedures designed to ensure that the information furnished is accurate.’; and

        (C) by adding at the end the following new subparagraph:

        ‘(F) DEFINITION- For purposes of subparagraph (A), the term ‘reasonable cause to believe that the information is inaccurate’ means, based on the procedures described in subparagraph (B), has knowledge, other than solely allegations by the consumer, that would cause a reasonable person to have substantial doubts about the accuracy of the information.’; and

      (3) by adding at the end the following new paragraph:

      ‘(6) ABILITY OF CONSUMER TO DISPUTE INFORMATION DIRECTLY WITH FURNISHER-

        ‘(A) IN GENERAL- A consumer may dispute directly with a person the accuracy of information that--

          ‘(i) is contained in a consumer report on the consumer prepared by a consumer reporting agency described in section 603(p); and

          ‘(ii) was provided by the person to that consumer reporting agency in accordance with paragraph (1)(B).

        ‘(B) SUBMITTING A NOTICE OF DISPUTE- A consumer who seeks to dispute the accuracy of information with a person under subparagraph (A) shall provide a dispute notice directly to such person at the address specified by the person for such notices that--

          ‘(i) identifies the specific information that is being disputed; and

          ‘(ii) explains the basis for the dispute.

        ‘(C) DUTY OF PERSON AFTER RECEIVING NOTICE OF DISPUTE- After receiving a notice of dispute from a consumer pursuant to subparagraph (B), the person that provided the information in dispute to a consumer reporting agency referred to in subparagraph (A) shall--

          ‘(i) conduct an investigation with respect to the disputed information;

          ‘(ii) review all relevant information provided by the consumer with the notice;

          ‘(iii) complete such person’s investigation of the dispute and report the results of the investigation to the consumer before the expiration of the period under section 611(a)(1) within which a consumer reporting agency would be required to complete its action if the consumer had elected to dispute the information under that section; and

          ‘(iv) if the investigation finds that the information reported was inaccurate, promptly thereafter report correct information to each consumer reporting agency described in section 603(p) to which the person furnished the inaccurate information.’.

    (b) TECHNICAL AND CONFORMING AMENDMENTS-

      (1) Section 621(c)(5)(A) of the Fair Credit Reporting Act (15 U.S.C. 1681s(c)(5)(A)) is amended by striking ‘section 623(a)(1)’ and inserting ‘paragraph (1) or (6) of section 623(a)’.

      (2) The heading for section 621(c)(5) of the Fair Credit Reporting Act (15 U.S.C. 1681s(c)(5)) is amended by striking ‘VIOLATION OF SECTION 623(a)(1)’ and inserting ‘CERTAIN VIOLATIONS OF SECTION 623(a)’.

SEC. 305. PROMPT INVESTIGATION OF DISPUTED CONSUMER INFORMATION.

    (a) STUDY REQUIRED- The Board of Governors of the Federal Reserve System and the Federal Trade Commission shall jointly study the extent to which, and the manner in which, consumer reporting agencies and furnishers of consumer information to consumer reporting agencies are complying with the procedures, time lines, and requirements under the Fair Credit Reporting Act for the prompt investigation of the disputed accuracy of any consumer information, the completeness of the information provided to consumer reporting agencies, and the prompt correction or deletion, in accordance with such Act, of any inaccurate or incomplete information or information that cannot be verified.

    (b) REPORT REQUIRED- Before the end of the 6-month period beginning on the date of the enactment of this Act, the Board of Governors of the Federal Reserve System and the Federal Trade Commission shall jointly submit a progress report to the Congress on the results of the study required under subsection (a).

    (c) RECOMMENDATIONS- The report under subsection (b) shall include such recommendations as the Board and the Commission jointly determine to be appropriate for legislative or administrative action to ensure that--

      (1) consumer disputes with consumer reporting agencies over the accuracy or completeness of information in a consumer’s file are promptly and fully investigated and any incorrect, incomplete, or unverifiable information is corrected or deleted immediately thereafter;

      (2) furnishers of information to consumer reporting agencies maintain full and prompt compliance with the duties and responsibilities established under section 623 of the Fair Credit Reporting Act; and

      (3) consumer reporting agencies establish and maintain appropriate internal controls and management review procedures for maintaining full and continuous compliance with the procedures, time lines, and requirements under the Fair Credit Reporting Act for the prompt investigation of the disputed accuracy of any consumer information and the prompt correction or deletion, in accordance with such Act, of any inaccurate or incomplete information or information that cannot be verified.

    (d) DEFINITIONS- For purposes of this section, the terms ‘consumer’, ‘consumer report’, and ‘consumer reporting agency’ have the same meaning as in the Fair Credit Reporting Act.

TITLE IV--IMPROVING ACCURACY OF CONSUMER RECORDS

SEC. 401. RECONCILING ADDRESSES.

    Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is amended by inserting after subsection (g) (as added by section 201 of this Act) the following new subsection.

    ‘(h) NOTICE OF DISCREPANCY-

      ‘(1) IN GENERAL- If a person has requested a consumer report relating to a consumer from a consumer reporting agency described in section 603(p), the request includes an address for the consumer that

substantially differs from the addresses in the file of the consumer, and the agency provides a consumer report in response to the request, the consumer reporting agency shall notify the requester of the existence of the discrepancy.

      ‘(2) REGULATIONS-

        ‘(A) REGULATIONS REQUIRED- The Federal banking agencies and the National Credit Union Administration shall jointly prescribe regulations providing guidance regarding reasonable policies and procedures a user of a consumer report should employ when such user has received a notice of discrepancy under paragraph (1).

        ‘(B) POLICIES AND PROCEDURES TO BE INCLUDED- The regulations prescribed under subparagraph (A) shall describe reasonable policies and procedures for use by a user of a consumer report--

          ‘(i) to form a reasonable belief that the user knows the identity of the person to whom the consumer report pertains; and

          ‘(ii) if the user establishes a continuing relationship with the consumer, and the user regularly and in the ordinary course of business furnishes information to the consumer reporting agency from which the notice of discrepancy pertaining to the consumer was obtained, to reconcile the consumer’s address with the consumer reporting agency by furnishing such address to such consumer reporting agency as part of information regularly furnished by the user for the period in which the relationship is established.’.

SEC. 402. PREVENTION OF REPOLLUTION OF CONSUMER REPORTS.

    Section 623(a)(1) of the Fair Credit Reporting Act (15 U.S.C. 1681s-2(a)(1)) is amended by inserting after subparagraph (D) (as so redesignated by section 304(2)(A)) the following new subparagraph:

        ‘(E) INFORMATION ALLEGED TO RESULT FROM IDENTITY THEFT- If a consumer submits a police report to a person who furnishes information to a consumer reporting agency that states that information maintained by such person that purports to relate to the consumer resulted from identity theft, the person may not furnish such information that purports to relate to the consumer to any consumer reporting agency, unless the person subsequently knows or is informed by the consumer that the information is correct.’.

SEC. 403. NOTICE BY USERS WITH RESPECT TO FRAUDULENT INFORMATION.

    Section 615 of the Fair Credit Reporting Act (15 U.S.C. 1681m) is amended by adding at the end the following new subsection:

    ‘(e) NOTICE OF FRAUDULENT INFORMATION RELATING TO IDENTITY THEFT- If an agent acting as a debt collector (as defined in title VIII) of a person who furnishes information to any consumer reporting agency uses information contained in a consumer report on any consumer and learns that any such information so used is the result of identity theft or otherwise is fraudulent, the agent shall--

      ‘(1) if such information--

        ‘(A) originated from the person for whom the debt collector is acting as agent, notify the person of the fraudulent information; or

        ‘(B) originated from a person other than the person for whom the debt collector is acting as agent, notify the consumer reporting agency (that provided the consumer report) of the fraudulent information, either directly or through the person for whom the debt collector is acting as agent; and

      ‘(2) upon the request of the consumer, provide the consumer with all information which the consumer would be entitled to receive if the information related to the consumer other than by reason of identity theft.’.

SEC. 404. DISCLOSURE TO CONSUMERS OF CONTACT INFORMATION FOR USERS AND FURNISHERS OF INFORMATION IN CONSUMER REPORTS.

    Section 609(a) of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)) is amended--

      (1) in paragraph (2), by inserting ‘, including addresses of the sources, and (if provided by the sources of information) the telephone numbers identified for customer service for the sources of information’ after ‘sources of information’ the 1st place such term appears in such paragraph; and

      (2) in paragraph (3)(B) by striking clause (ii) and inserting the following new clause:

          ‘(ii) the address and (if provided) the telephone numbers identified for customer service of the person.’.

SEC. 405. FTC STUDY OF THE ACCURACY OF CONSUMER REPORTS.

    (a) STUDY REQUIRED- Until the final report is submitted under subsection (b)(2), the Federal Trade Commission shall conduct an ongoing study of the accuracy and completeness of information contained in consumer reports prepared or maintained by consumer reporting agencies and methods for improving the accuracy and completeness of such information.

    (b) BIENNIAL REPORTS REQUIRED-

      (1) INTERIM REPORTS- The Federal Trade Commission shall submit an interim report to the Congress on the study conducted under subsection (a) at the end of the 6-month period beginning on the date of the enactment of this Act and biennially thereafter for 8 years.

      (2) FINAL REPORT- The Federal Trade Commission shall submit a final report to the Congress on the study conducted under subsection (a) at the end of the 2-year period beginning on the date the final interim report is submitted to the Congress under paragraph (1).

      (3) CONTENTS- Each report submitted under this subsection shall contain a detailed summary of the findings and conclusions of the Commission with respect to the study required under subsection (a) and such recommendations for legislative and administrative action as the Commission may determine to be appropriate.

TITLE V--IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT INFORMATION

SEC. 501. FREE REPORTS ANNUALLY.

    (a) FREE REPORTS ANNUALLY FROM NATIONWIDE CONSUMER REPORTING AGENCIES- Section 612 of the Fair Credit Reporting Act (15 U.S.C. 1681j) is amended by adding at the end the following new subsection:

    ‘(e) FREE ANNUAL DISCLOSURE- Upon the direct request of the consumer, a consumer reporting agency described in section 603(p) shall make all disclosures pursuant to section 609 once during any 12-month period without charge to the consumer.’.

    (b) TECHNICAL AND CONFORMING AMENDMENT- Section 612(c) of the Fair Credit Reporting Act (15 U.S.C. 1681j(c)) is amended by inserting ‘that is not a consumer reporting agency described in section 603(p)’ after ‘consumer reporting agency’.

SEC. 502. DISCLOSURE OF CREDIT SCORES.

    (a) STATEMENT ON AVAILABILITY OF CREDIT SCORES- Section 609(a) of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)) is amended by adding at the end the following new paragraph:

      ‘(6) If the consumer requests the credit file and not the credit score, a statement that the consumer may request and obtain a credit score.’.

    (b) DISCLOSURE OF CREDIT SCORES- Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681g) is amended by inserting after subsection (d) (as added by section 204 of this Act) the following new subsection:

    ‘(e) DISCLOSURE OF CREDIT SCORES-

      ‘(1) IN GENERAL- Upon the consumer’s request for a credit score, a consumer reporting agency shall supply to a consumer a statement indicating that the information and credit scoring model may be different than the credit score that may be used by the lender, and a notice which shall include the following information:

        ‘(A) The consumer’s current credit score or the consumer’s most recent credit score that was previously calculated by the credit reporting agency for a purpose related to the extension of credit.

        ‘(B) The range of possible credit scores under the model used.

        ‘(C) All the key factors that adversely affected the consumer’s credit score in the model used, the total number of which shall not exceed four, subject to paragraph (9).

        ‘(D) The date the credit score was created.

        ‘(E) The name of the person or entity that provided the credit score or credit file upon which the credit score was created.

      ‘(2) DEFINITIONS- For purposes of this section, the following definitions shall apply:

        ‘(A) CREDIT SCORE- The term ‘credit score’--

          ‘(i) means a numerical value or a categorization derived from a statistical tool or modeling system used by a person who makes or arranges a loan to predict the likelihood of certain credit behaviors, including default (and the numerical value or the categorization derived from this analysis may also be referred to as a ‘risk predictor’ or ‘risk score’); and

          ‘(ii) does not include--

            ‘(I) any mortgage score or rating of an automated underwriting system that considers one or more factors in

addition to credit information, including the loan to value ratio, the amount of down payment, or a consumer’s financial assets; or

            ‘(II) any other elements of the underwriting process or underwriting decision.

        ‘(B) KEY FACTORS- The term ‘key factors’ means all relevant elements or reasons adversely affecting the credit score for the particular individual listed in the order of their importance based on their effect on the credit score.

      ‘(3) TIMEFRAME AND MANNER OF DISCLOSURE- The information required by this subsection shall be provided in the same timeframe and manner as the information described in subsection (a).

      ‘(4) APPLICABILITY TO CERTAIN USES- This subsection shall not be construed so as to compel a consumer reporting agency to develop or disclose a score if the agency does not--

        ‘(A) distribute scores that are used in connection with residential real property loans; or

        ‘(B) develop scores that assist credit providers in understanding a consumer’s general credit behavior and predicting the future credit behavior of the consumer.

      ‘(5) APPLICABILITY TO CREDIT SCORES DEVELOPED BY ANOTHER PERSON-

        ‘(A) IN GENERAL- This subsection shall not be construed to require a consumer reporting agency that distributes credit scores developed by another person or entity to provide a further explanation of them, or to process a dispute arising pursuant to section 611, except that the consumer reporting agency shall provide the consumer with the name and address and website for contacting the person or entity who developed the score or developed the methodology of the score.

        ‘(B) EXCEPTION- This paragraph shall not apply to a consumer reporting agency that develops or modifies scores that are developed by another person or entity.

      ‘(6) MAINTENANCE OF CREDIT SCORES NOT REQUIRED- This subsection shall not be construed to require a consumer reporting agency to maintain credit scores in its files.

      ‘(7) COMPLIANCE IN CERTAIN CASES- In complying with this subsection, a consumer reporting agency shall--

        ‘(A) supply the consumer with a credit score that is derived from a credit scoring model that is widely distributed to users by that consumer reporting agency in connection with residential real property loans or with a credit score that assists the consumer in understanding the credit scoring assessment of the credit behavior of the consumer and predictions about the future credit behavior of the consumer; and

        ‘(B) a statement indicating that the information and credit scoring model may be different than that used by the lender.

      ‘(8) REASONABLE FEE- A consumer reporting agency may charge a reasonable fee for providing the information required under this subsection.

      ‘(9) USE OF ENQUIRIES AS A KEY FACTOR- If a key factor that adversely affects a consumer’s credit score consists of the number of enquiries made with respect to a consumer report, that factor shall be included in the disclosure pursuant to paragraph (1)(C) without regard to the numerical limitation in such paragraph.’.

    (c) DISCLOSURE OF CREDIT SCORES BY CERTAIN MORTGAGE LENDERS- Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681g) is amended by inserting after subsection (e) (as added by subsection (b) of this section) the following new subsection:

    ‘(f) DISCLOSURE OF CREDIT SCORES BY CERTAIN MORTGAGE LENDERS-

      ‘(1) IN GENERAL- Any person who makes or arranges loans and who uses a consumer credit score as defined in subsection (e) in connection with an application initiated or sought by a consumer for a closed end loan or establishment of an open end loan for a consumer purpose that is secured by 1 to 4 units of residential real property (hereafter in this subsection referred to as the ‘lender’) shall provide the following to the consumer as soon as reasonably practicable:

        ‘(A) INFORMATION REQUIRED UNDER SUBSECTION(e)-

          ‘(i) IN GENERAL- A copy of the information identified in subsection (e) that was obtained from a consumer reporting agency or was developed and used by the user of the information.

          ‘(ii) NOTICE UNDER SUBPARAGRAPH (D)- In addition to the information provided to it by a third party that provided the credit score or scores, a lender is only required to provide the notice contained in subparagraph (D).

        ‘(B) DISCLOSURES IN CASE OF AUTOMATED UNDERWRITING SYSTEM-

          ‘(i) IN GENERAL- If a person who is subject to this section uses an automated underwriting system to underwrite a loan, that person may satisfy the obligation to provide a credit score by disclosing a credit score and associated key factors supplied by a consumer reporting agency.

          ‘(ii) NUMERICAL CREDIT SCORE- However, if a numerical credit score is generated by an automated underwriting system used by an enterprise, and that score is disclosed to the person, the score shall be disclosed to the consumer consistent with subparagraph (C).

          ‘(iii) ENTERPRISE DEFINED- For purposes of this subparagraph, the term ‘enterprise’ shall have the same meaning as in paragraph (6) of section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992.

        ‘(C) DISCLOSURES OF CREDIT SCORES NOT OBTAINED FROM A CONSUMER REPORTING AGENCY- A person subject to the provisions of this subsection who uses a credit score other than a credit score provided by a consumer reporting agency may satisfy the obligation to provide a credit score by disclosing a credit score and associated key factors supplied by a consumer reporting agency.

        ‘(D) NOTICE TO HOME LOAN APPLICANTS- A copy of the following notice, which shall include the name, address, and telephone number of each consumer reporting agency providing a credit score that was used:

‘notice to the home loan applicant

    ‘In connection with your application for a home loan, the lender must disclose to you the score that a consumer reporting agency distributed to users and the lender used in connection with your home loan, and the key factors affecting your credit scores.

    ‘The credit score is a computer generated summary calculated at the time of the request and based on information a consumer reporting agency or lender has on file. The scores are based on data about your credit history and payment patterns. Credit scores are important because they are used to assist the lender in determining whether you will obtain a loan. They may also be used to determine what interest rate you may be offered on the mortgage. Credit scores can change over time, depending on your conduct, how your credit history and payment patterns change, and how credit scoring technologies change.

    ‘Because the score is based on information in your credit history, it is very important that you review the credit-related information that is being furnished to make sure it is accurate. Credit records may vary from one company to another.

    ‘If you have questions about your credit score or the credit information that is furnished to you, contact the consumer reporting agency at the address and telephone number provided with this notice, or contact the lender, if the lender developed or generated the credit score. The consumer reporting agency plays no part in the decision to take any action on the loan application and is unable to provide you with specific reasons for the decision on a loan application.

      ‘If you have questions concerning the terms of the loan, contact the lender.’.

        ‘(E) ACTIONS NOT REQUIRED UNDER THIS SUBSECTION- This subsection shall not require any person to do any of the following:

          ‘(i) Explain the information provided pursuant to subsection (e).

          ‘(ii) Disclose any information other than a credit score or key factor, as defined in subsection (e).

          ‘(iii) Disclose any credit score or related information obtained by the user after a loan has closed.

          ‘(iv) Provide more than 1 disclosure per loan transaction.

          ‘(v) Provide the disclosure required by this subsection when another person has made the disclosure to the consumer for that loan transaction.

        ‘(F) NO OBLIGATION FOR CONTENT-

          ‘(i) IN GENERAL- Any person’s obligation pursuant to this subsection shall be limited solely to providing a copy of the information that was received from the consumer reporting agency.

          ‘(ii) LIMIT ON LIABILITY- No person has liability under this subsection for the

content of that information or for the omission of any information within the report provided by the consumer reporting agency.

        ‘(G) PERSON DEFINED AS EXCLUDING ENTERPRISE- As used in this subsection, the term ‘person’ does not include an enterprise (as defined in paragraph (6) of section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992).

      ‘(2) PROHIBITION ON DISCLOSURE CLAUSES NULL AND VOID-

        ‘(A) IN GENERAL- Any provision in a contract that prohibits the disclosure of a credit score by a person who makes or arranges loans or a consumer reporting agency is void.

        ‘(B) NO LIABILITY FOR DISCLOSURE UNDER THIS SUBSECTION- A lender shall not have liability under any contractual provision for disclosure of a credit score pursuant to this subsection.’.

    (d) INCLUSION OF KEY FACTOR IN CREDIT SCORE INFORMATION IN CONSUMER REPORT- Section 605(d) of the Fair Credit Reporting Act (15 U.S.C. 1681c(d)) is amended--

      (1) by striking ‘DISCLOSED- Any consumer reporting agency’ and inserting ‘DISCLOSED-

      ‘(1) TITLE 11 INFORMATION- Any consumer reporting agency’; and

      (2) by adding at the end the following new paragraph:

      ‘(2) KEY FACTOR IN CREDIT SCORE INFORMATION- Any consumer reporting agency that furnishes a consumer report that contains any credit score or any other risk score or predictor on any consumer shall include in the report a clear and conspicuous statement that a key factor (as defined in section 609(e)(2)(B)) that adversely affected such score or predictor was the number of enquiries, if such a predictor was in fact a key factor that adversely affected such score.’.

SEC. 503. SIMPLER AND EASIER METHOD FOR CONSUMERS TO USE NOTIFICATION SYSTEM.

    (a) IN GENERAL- Section 604(e)(5)(A)(i) of the Fair Credit Reporting Act (15 U.S.C. 1681b(e)(5)(A)(i)) is amended by inserting ‘in a simple and easy manner and’ after ‘notify the agency,’.

    (b) SIMPLIFIED NOTICE AND RESPONSE FORMAT FOR USERS- Section 615(d) of the Fair Credit Reporting Act (15 U.S.C. 1681m(d)) is amended--

      (1) by redesignating paragraphs (2), (3), and (4), as paragraphs (3), (4) and (5); and

      (2) by inserting after paragraph (1) the following new paragraph:

      ‘(2) SIMPLE AND EASY NOTIFICATION- Any statement given the consumer under paragraph (1)(E) shall be in a simple and easy to understand format and shall describe the simple and easy method established under section 604(e)(5)(A)(i) for the consumer to respond.’.

SEC. 504. REQUIREMENT TO DISCLOSE COMMUNICATIONS TO A CONSUMER REPORTING AGENCY.

    (a) IN GENERAL- Section 623(a) of the Fair Credit Reporting Act (15 U.S.C. 1681s-2(a)) is amended by inserting after paragraph (6) (as added by section 304(3)) the following new paragraph:

      ‘(7) NEGATIVE INFORMATION-

        ‘(A) NOTICE TO CONSUMER REQUIRED-

          ‘(i) IN GENERAL- If any financial institution that extends credit and regularly and in the ordinary course of business furnishes information to a consumer reporting agency described in section 603(p) furnishes negative information to such an agency regarding credit extended to a customer, the financial institution shall provide a notice of such furnishing of negative information, in writing, to the customer.

          ‘(ii) NOTICE EFFECTIVE FOR SUBSEQUENT SUBMISSIONS- After providing such notice, the financial institution may submit additional negative information to a consumer reporting agency described in section 603(p) with respect to the same transaction, extension of credit, account, or customer without providing additional notice to the customer.

        ‘(B) TIME OF NOTICE-

          ‘(i) IN GENERAL- The notice required under subparagraph (A) shall be provided to the customer prior to, or no later than 30 days after, furnishing the negative information to a consumer reporting agency described in section 603(p).

          ‘(ii) COORDINATION WITH NEW ACCOUNT DISCLOSURES- If the notice is provided to the customer prior to furnishing the negative information to a consumer reporting agency, the notice may not be included in the initial disclosures provided

under section 127(a) of the Truth in Lending Act.

        ‘(C) COORDINATION WITH OTHER DISCLOSURES- The notice required under subparagraph (A)--

          ‘(i) may be included on or with any notice of default, any billing statement, or any other materials provided to the customer; and

          ‘(ii) must be clear and conspicuous.

        ‘(D) MODEL DISCLOSURE-

          ‘(i) DUTY OF BOARD TO PREPARE- The Board shall prescribe a brief model disclosure a financial institution may use to comply with subparagraph (A), which shall not exceed 30 words.

          ‘(ii) USE OF MODEL NOT REQUIRED- No provision of this paragraph shall be construed as requiring a financial institution to use any such model form prescribed by the Board.

          ‘(iii) COMPLIANCE USING MODEL- A financial institution shall be deemed to be in compliance with subparagraph (A) if the financial institution uses any such model form prescribed by the Board, or the financial institution uses any such model form and rearranges its format.

        ‘(E) USE OF NOTICE WITHOUT SUBMITTING NEGATIVE INFORMATION- No provision of this paragraph shall be construed as requiring a financial institution that has provided a customer with a notice described in subparagraph (A) to furnish negative information about the customer to a consumer reporting agency.

        ‘(F) SAFE HARBOR- A financial institution shall not be liable for failure to perform the duties required by this paragraph if, at the time of the failure, the financial institution maintained reasonable policies and procedures to comply with this paragraph.

        ‘(G) DEFINITIONS- For purposes of this paragraph, the following definitions shall apply:

          ‘(i) NEGATIVE INFORMATION- The term ‘negative information’ means information concerning a customer’s delinquencies, late payments, insolvency, or any form of default.

          ‘(ii) CUSTOMER; FINANCIAL INSTITUTION- The terms ‘customer’ and ‘financial institution’ have the same meaning as in section 509 of the Gramm-Leach-Bliley Act.’.

    (b) MODEL DISCLOSURE FORM- Before the end of the 6-month period beginning on the date of the enactment of this Act, the Board of Governors of the Federal Reserve System shall adopt the model disclosure required under the amendment made by subsection (a) after notice duly given in the Federal Register and an opportunity for public comment in accordance with section 553 of title 5, United States Code.

SEC. 505. STUDY OF EFFECTS OF CREDIT SCORES AND CREDIT-BASED INSURANCE SCORES ON AVAILABILITY AND AFFORDABILITY OF FINANCIAL PRODUCTS.

    (a) STUDY REQUIRED- The Federal Trade Commission, in consultation with the Office of Fair Housing and Equal Opportunity of the Department of Housing and Urban Development, shall conduct a study of--

      (1) the effects of the use of credit scores and credit-based insurance scores on the availability and affordability of financial products and services, including credit cards, mortgages, auto loans, and property and casualty insurance;

      (2) the degree of causality between the factors considered by credit score systems and the quantifiable risks and actual losses experienced by businesses, including the extent to which, if any, each of the factors considered or otherwise taken into account by such systems are accurate predictors of risk or loss, and where the means square error of a scoring model’s predictions are considered in the evaluation of accuracy;

      (3) the extent to which, if any, the use of credit scoring models, credit scores and credit-based insurance scores result in disparate impact by geography, income, ethnicity, race, color, religion, national origin, age, sex or marital status, and creed, including the extent to which the consideration or lack of consideration of certain factors by credit scoring systems could result in disparate effects and the extent to which, if any, the use of underwriting systems relying on these models could achieve comparable results through the use of factors with less disparate impact; and

      (4) the extent to which credit scoring systems are used by businesses, the factors considered by such systems, and the effects of variables which are not considered by such systems.

    (b) PUBLIC PARTICIPATION- The Commission shall seek public input about the prescribed methodology and research design of the study required in subsection (a).

    (c) REPORT REQUIRED-

      (1) IN GENERAL- Before the end of the 18-month period beginning on the date of the enactment of this Act, the Federal Trade Commission shall submit a detailed report on the study conducted pursuant to subsection (a) to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate.

      (2) CONTENTS OF REPORT- The report submitted under paragraph (1) shall include the findings and conclusions of the Commission, together with such recommendations for legislative or administrative action as the Commission may determine to be necessary to ensure that credit and credit-based insurances score are used appropriately and fairly to avoid disparate effects.

    (d) CREDIT SCORE DEFINED- For purposes of this section, the term ‘credit score’ means a numerical value or a categorization derived from a statistical tool or modeling system used to predict the likelihood of certain credit or insurance behaviors, including default.

SEC. 506. GAO STUDY ON DISPARATE IMPACT OF CREDIT SYSTEM.

    (a) STUDY REQUIRED- The Comptroller General shall conduct a study of the credit system to determine the extent to which, if any, discrimination exists with regard to the availability and the terms of credit which has a disparate impact on the basis of race, color, income and education level, geographic location, age, sex, sexual orientation, national origin, or marital status and the nature of any such discriminatory effect.

    (b) REPORT REQUIRED- Before the end of the 2-year period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress on the findings and conclusions of the Comptroller General pursuant to the study conducted under subsection (a), together with such recommendations for legislative or administrative action as the Comptroller General may determine to be appropriate.

SEC. 507. ANALYSIS OF FURTHER RESTRICTIONS ON OFFERS OF CREDIT OR INSURANCE.

    (a) IN GENERAL- The Board of Governors of the Federal Reserve System shall conduct a study of--

      (1) the ability of consumers to avoid receiving written offers of credit or insurance in connection with transactions not initiated by the consumer; and

      (2) the potential impact any further restrictions on providing consumers with such written offers of credit or insurance would have on consumers.

    (b) REPORT- The Board of Governors of the Federal Reserve System shall submit a report summarizing the results of the study required under subsection (a) to the Congress no later than 12 months after the date of the enactment of this Act, together with such recommendatioons for legislative or administrative action as the Board may determine to be appropriate.

    (c) CONTENT OF REPORT- The report described in subsection (b) shall address the following issues:

      (1) The current statutory or voluntary mechanisms that are available to a consumer to notify lenders and insurance providers that the consumer does not wish to receive written offers of credit or insurance.

      (2) The extent to which consumers are currently utilizing existing statutory and voluntary mechanisms to avoid receiving offers of credit or insurance.

      (3) The benefits provided to consumers as a result of receiving written offers of credit or insurance.

      (4) Whether consumers incur significant costs or are otherwise adversely affected by the receipt of written offers of credit or insurance.

      (5) Whether further restricting the ability of lenders and insurers to provide written offers of credit or insurance to consumers would affect--

        (A) the cost consumers pay to obtain credit or insurance;

        (B) the availability of credit or insurance;

        (C) consumers’ knowledge about new or alternative products and services;

        (D) the ability of lenders or insurers to compete with one another; and

        (E) the ability to offer credit or insurance products to consumers who have been traditionally underserved.

SEC. 508. STUDY ON THE NEED AND THE MEANS FOR IMPROVING FINANCIAL LITERACY AMONG CONSUMERS.

    (a) STUDY REQUIRED- The Comptroller General shall conduct a study to assess the extent of consumers’ knowledge and awareness of credit reports, credit scores, and the dispute resolution process, and on methods for improving financial literacy among consumers.

    (b) FACTORS TO BE INCLUDED- The study required under subsection (a) shall include the following issues:

      (1) The number of consumers who view their credit reports.

      (2) Under what conditions and for what purposes do consumers primarily obtain a copy of their consumer report (such as for the purpose of ensuring the completeness and accuracy of the contents, to protect against fraud, in response to an adverse action based on the report, or in response to suspected identity theft) and approximately what percentage of the total number of consumers who obtain a copy of their consumer report do so for each such primary purpose.

      (3) The extent of consumers’ knowledge of the data collection process.

      (4) The extent to which consumers know how to get a copy of a consumer report.

      (5) The extent to which consumers know and understand the factors that positively or negatively impact credit scores.

    (c) REPORT REQUIRED- Before the end of the 9-month period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress on the findings and conclusions of the Comptroller General pursuant to the study conducted under subsection (a), together with such recommendations for legislative or administrative action as the Comptroller General may determine to be appropriate, including recommendations on methods for improving financial literacy among consumers.

SEC. 509. DISCLOSURE OF INCREASE IN APR UNDER CERTAIN CIRCUMSTANCES.

    Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681m) is amended by inserting after subsection (f) (as added by section 502(c) of this title) the following new subsection:

    ‘(g) DISCLOSURE TO CONSUMER-

      ‘(1) IN GENERAL- The ability of a credit card issuer to increase any annual percentage rate applicable to a credit card account, or to remove or increase any introductory annual percentage rate of interest applicable to such account, for reasons other than actions or omissions of the card holder that are directly related to such account shall be clearly and conspicuously disclosed to the consumer by the credit card issuer in any disclosure or statement required to be made to the consumer under this title in connection with a credit card solicitation that is not initiated by the consumer.

      ‘(2) REGULATIONS AND MODEL STATEMENTS- The Board, in consultation with the Federal banking agencies and the National Credit Union Administration, shall develop such guidelines in regulations as necessary to assure that the information to be disclosed to consumers pursuant to paragraph (1) is clearly and conspicuously provided in a prominent location in any credit card solicitation that is not initiated by the consumer, and shall include model disclosure statements to be used by credit card issuers in making the disclosures required to be provided to the consumer by paragraph (1).’.

TITLE VI--PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS

SEC. 601. CERTAIN EMPLOYEE INVESTIGATION COMMUNICATIONS EXCLUDED FROM DEFINITION OF CONSUMER REPORT.

    (a) IN GENERAL- Section 603 of the Fair Credit Reporting Act (15 U.S.C. 1681a) is amended by inserting after subsection (p) the following new subsection:

    ‘(q) EXCLUSION OF CERTAIN COMMUNICATIONS FOR EMPLOYEE INVESTIGATIONS-

      ‘(1) COMMUNICATIONS DESCRIBED IN THIS SUBSECTION- A communication is described in this subsection if--

        ‘(A) but for subsection (d)(2)(D), the communication would be a consumer report;

        ‘(B) the communication is made to an employer in connection with an investigation of--

          ‘(i) suspected misconduct relating to employment; or

          ‘(ii) compliance with Federal, State, or local laws and regulations, the rules of a self-regulatory organization, or any preexisting written policies of the employer;

        ‘(C) the communication is not made for the purpose of investigating a consumer’s credit worthiness, credit standing, or credit capacity; and

        ‘(D) the communication is not provided to any person except--

          ‘(i) to the employer or an agent of the employer;

          ‘(ii) to any Federal or State officer, agency, or department, or any officer, agency, or department of a unit of general local government;

          ‘(iii) to any self-regulatory organization with regulatory authority over the activities of the employer or employee;

          ‘(iv) as otherwise required by law; or

          ‘(v) pursuant to section 608.

      ‘(2) SUBSEQUENT DISCLOSURE- After taking any adverse action based in whole or in part on a communication described in paragraph (1), the employer shall disclose to the consumer a summary containing the nature and substance of the communication upon which the adverse action is based, except that the sources of information acquired solely for use in preparing what would be but for subsection (d)(2)(D) an investigative consumer report need not be disclosed.

      ‘(3) SELF-REGULATORY ORGANIZATION DEFINED- For purposes of this subsection, the term ‘self-regulatory organization’ includes any self-regulatory organization (as defined in section 3(a)(26) of the Securities Exchange Act of 1934), any entity established under title I of the Sarbanes-Oxley Act of 2002, any board of trade designated by the Commodity Futures Trading Commission, and any futures association registered with such Commission.’.

    (b) TECHNICAL AND CONFORMING AMENDMENT- Section 603(d)(2)(D) of the Fair Credit Reporting Act (15 U.S.C. 1681a(d)(2)(D)) is amended by inserting ‘or (q)’ after ‘subsection (o)’.

TITLE VII--LIMITING THE USE AND SHARING OF MEDICAL INFORMATION IN THE FINANCIAL SYSTEM

SEC. 701. PROTECTION OF MEDICAL INFORMATION IN THE FINANCIAL SYSTEM

    (a) IN GENERAL- Section 604(g) of the Fair Credit Reporting Act (15 U.S.C. 1681b(g)) is amended to read as follows:

    ‘(g) PROTECTION OF MEDICAL INFORMATION-

      ‘(1) LIMITATION ON CONSUMER REPORTING AGENCIES- A consumer reporting agency shall not furnish for employment purposes, or in connection with a credit or insurance transaction, a consumer report that contains medical information about a consumer, unless--

        ‘(A) if furnished in connection with an insurance transaction, the consumer affirmatively consents to the furnishing of the report;

        ‘(B) if furnished for employment purposes or in connection with a credit transaction--

          ‘(i) the information to be furnished is relevant to process or effect the employment or credit transaction; and

          ‘(ii) the consumer provides specific written consent for the furnishing of the report that describes in clear and conspicuous language the use for which the information will be furnished; or

        ‘(C) such information is restricted or reported using codes that do not identify, or provide information sufficient to infer, the specific provider or the nature of such services, products, or devices to a person other than the consumer, unless the report is being provided to an insurance company for a purpose relating to engaging in the business of insurance other than property and casualty insurance.

      ‘(2) LIMITATION ON CREDITORS- Except as permitted pursuant to paragraph (3)(C) or regulations prescribed under paragraph (5)(A), a creditor shall not obtain or use medical information pertaining to a consumer in connection with any determination of the consumer’s eligibility, or continued eligibility, for credit.

      ‘(3) ACTIONS AUTHORIZED BY FEDERAL LAW, INSURANCE ACTIVITIES AND REGULATORY DETERMINATIONS- Section 603(d)(3) shall not be construed so as to treat information or any communication of information as a consumer report if the information or communication is disclosed--

        ‘(A) in connection with the business of insurance or annuities, including the activities described in section 18B of the model Privacy of Consumer Financial and Health Information Regulation issued by the National Association of Insurance Commissioners (as in effect on January 1, 2003);

        ‘(B) for any purpose permitted without authorization under the Standards for Individually Identifiable Health Information promulgated by the Department of Health and Human Services pursuant to the Health Insurance Portability and Accountability Act of 1996, or referred to under section 1179 of such Act, or described in section 502(e) of Public Law 106-102; or

        ‘(C) as otherwise determined to be necessary and appropriate, by regulation or order and subject to paragraph (6), by the Commission, any Federal banking agency or the National Credit Union Administration (with respect to any financial institution subject to the jurisdiction of such agency or Administration under paragraph (1), (2), or (3) of section 621(b), or the applicable State insurance authority (with respect to any person engaged in providing insurance or annuities).

      ‘(4) LIMITATION ON REDISCLOSURE OF MEDICAL INFORMATION- Any person that receives medical information pursuant to paragraphs (1) or (3) shall not disclose such information to any other person except as necessary to carry out the purpose for which the information was initially disclosed, or as otherwise permitted by statute, regulation, or order.

      ‘(5) REGULATIONS AND EFFECTIVE DATE FOR PARAGRAPH (2)-

        ‘(A) REGULATIONS REQUIRED- Each Federal banking agency and the National Credit Union Administration shall, subject to paragraph (6) and after notice and opportunity for comment, prescribe regulations that permit transactions under paragraph (2) that are determined to be necessary and appropriate to protect legitimate operational, transactional, risk, consumer, and other needs, consistent with the intent of paragraph (2) to restrict the use of medical information for inappropriate purposes.

        ‘(B) FINAL REGULATIONS REQUIRED- The Federal banking agencies and the National Credit Union Administration shall prescribe the regulations required under subparagraph (A) in final form before the end of the 6-month period beginning on the date of the enactment of the Fair and Accurate Credit Transactions Act of 2003.

      ‘(6) COORDINATION WITH OTHER LAWS- No provision of this subsection shall be construed as altering, affecting, or superseding the applicability of any other provision of Federal law relating to medical confidentiality.’.

    (b) RESTRICTION ON SHARING OF MEDICAL INFORMATION- Section 603(d) of the Fair Credit Reporting Act (15 U.S.C. 1681a(d)) is amended--

      (1) in paragraph (2), by striking ‘The term’ and inserting ‘Except as provided in paragraph (3), the term’; and

      (2) by adding at the end the following new paragraph:

      ‘(3) RESTRICTION ON SHARING OF MEDICAL INFORMATION- Except for information or any communication of information disclosed as provided in section 604(g)(3), the exclusions in paragraph (2) shall not apply with respect to information disclosed to

any person related by common ownership or affiliated by corporate control if--

        ‘(A) the information is medical information; or

        ‘(B) the information is an individualized list or description based on a consumer’s payment transactions for medical products or services, or an aggregate list of identified consumers based on payment transactions for medical products or services.’.

SEC. 702. CONFIDENTIALITY OF MEDICAL CONTACT INFORMATION IN CREDIT REPORTS.

    (a) DUTIES OF MEDICAL INFORMATION FURNISHERS- Section 623(a) of the Fair Credit Reporting Act (15 U.S.C. 1681s-2(a)) is amended by inserting after paragraph (7) (as added by section 504(a)) the following new paragraph:

      ‘(8) DUTY TO PROVIDE NOTICE OF STATUS AS MEDICAL INFORMATION FURNISHER- A person whose primary business is providing medical services, products, or devices, or the person’s agent or assignee, who furnishes information to a consumer reporting agency on a consumer shall be considered a medical information furnisher for the purposes of this title and shall notify the agency of such status.’.

    (b) RESTRICTION OF DISSEMINATION OF MEDICAL CONTACT INFORMATION- Section 605(a) of the Fair Credit Reporting Act (15 U.S.C. 1681c(a)) is amended by adding the following new paragraph:

      ‘(6) The name, address, and telephone number of any medical information furnisher that has notified the agency of its status, unless--

        ‘(A) such name, address, and telephone number are restricted or reported using codes that do not identify, or provide information sufficient to infer, the specific provider or the nature of such services, products, or devices to a person other than the consumer; or

        ‘(B) the report is being provided to an insurance company for a purpose relating to engaging in the business of insurance other than property and casualty insurance.’.

    (c) NO EXCEPTIONS ALLOWED FOR DOLLAR AMOUNTS- Section 605(b) of the Fair Credit Reporting Act (15 U.S.C. 1681c(b)) is amended by striking ‘The provisions of subsection (a)’ and inserting ‘The provisions of paragraphs (1) through (5) of subsection (a)’.

    (d) COORDINATION WITH OTHER LAWS- No provision of any amendment made by this section shall be construed as altering, affecting, or superseding the applicability of any other provision of Federal law relating to medical confidentiality.

    (e) FTC REGULATION OF CODING OF TRADE NAMES- Section 621 of the Fair Credit Reporting Act (15 U.S.C. 1681s) is amended by inserting after subsection (f) (as added by section 301 of this Act) the following new subsection:

    ‘(g) FTC REGULATION OF CODING OF TRADE NAMES- If the Commission determines that a person described in paragraph (8) of section 623(a) has not met the requirements of such paragraph, the Commission shall take action to ensure the person’s compliance with such paragraph, which may include issuing model guidance or prescribing reasonable policies and procedures as necessary to ensure that such person complies with such paragraph.’.

    (f) TECHNICAL AND CONFORMING AMENDMENTS- Section 604(g) of the Fair Credit Reporting Act (15 U.S.C. 1681b(g)) (as amended by section 701) is amended--

      (1) in paragraph (1) by inserting ‘(other than medical contact information treated in the manner required under section 605(a)(6))’ after ‘a consumer report that contains medical information’; and

      (2) in paragraph (2) by inserting ‘(other than medical information treated in the manner required under section 605(a)(6))’ after ‘a creditor shall not obtain or use medical information’.

    (g) EFFECTIVE DATE- The amendments made by this section shall take effect at the end of the 15-month period beginning on the date of the enactment of this Act.

Union Calendar No. 150

108th CONGRESS

1st Session

H. R. 2622

[Report No. 108-263]

A BILL

To amend the Fair Credit Reporting Act, to prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, make improvements in the use of, and consumer access to, credit information, and for other purposes.


September 4, 2003

Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed