Beginning the first of the year, the Consumer Financial Protection Bureau (CFPB) will administer the Fair Credit Reporting Act (FCRA). The FCRA governs substantive and procedural requirements for employers who use consumer reports and records for employment purposes, among other things.
In anticipation of this change, the CFPB issued an interim final rule in December 2011, which includes a variety of model forms. As a practical matter, these forms were substantively identical to previous iterations under the Federal Trade Commission (the entity responsible for enforcing FCRA prior to the CFPB). Last month, the CFPB issued corrections to the model forms in order to fix technical and typographical errors from the December 2011 release.
Updated forms, which can be found through the GPO website and the CFPB website, are summarized below:
Remedying the Effects of Identity Theft – Summarizes the rights given under FCRA to individuals who have or may have been the victim of identity theft.
A Summary of Your Rights Under the Fair Credit Reporting Act – Summarizes FCRA rights. Two key points for employers: 1) employers who take adverse employment action against applicants or employees based on a credit/consumer report must inform that person and provide the name, address, and phone number of the agency that provided the information; and 2) employers are not entitled to consumer report information unless and until an employee or prospective employee provides written consent to the employer.
Notice to Furnishers of Information: Obligations of Furnishers Under the FCRA – Sets forth guidelines regarding accuracy of information provided under the FCRA.
Notice to Users of Consumer Reports: Obligations of Users Under the FCRA – Advises users of consumer reports of their legal obligations and must be provided. Of particular importance, this Notice sets forth obligations of employers who use consumer reports for employment purposes.
Businesses relying on the December 2011 model forms have a temporary reprieve. The CFPB’s November 2012 correction states: “the Bureau will regard the use of those model forms to constitute compliance with the FCRA provisions requiring such forms and will regard those forms to be substantially similar to the corrected forms published today, until further notice.” A final rule is anticipated in 2013.