Handle With Care

Excerpt from: {see} Digital Magazine - Issue #4
Published: July 15, 2008



HANDLE WITH CARE

How the Fair Credit Reporting Act Impacts the Way You Use Consumer Information

For the last three decades there has been an ever-increasing reliance by companies on consumer data for the purposes of conducting business.

The government, through legislation, has been setting standards to create a common and fair system for the handling of consumer information. This has become increasingly important as the availability of data has grown with the Internet and other technologies.

To that end, Fair Credit Report Act is a consumer protection law that affects any business that uses (or furnishes) consumer credit information. The purpose of the FCRA is to set standards of compliance regarding the use, retention and dissemination of consumer information. It is important for businesses to understand The Fair Credit Reporting Act as there can be steep penalties for non-compliance. The FCRA addresses three primary areas of consumer protection.

These are:

Accuracy of Information
The FCRA does not mandate absolute accuracy. Instead, it requires reasonable procedures and practical steps to assure best efforts are made to achieve accuracy.

Privacy of the Individual
The FCRA contains a number of provisions intended to protect a consumer's privacy by limiting the purposes for which a consumer's report can be disclosed.

Fairness toward the individual
Certain provisions in the Fair Credit Reporting Act are intended to make the system fair to consumers.

If your business uses consumer information for decisioning around hiring, leasing, or the selling of goods, you must abide by the stipulations of the FCRA. Failure to do so, or other abuses to the use of consumer information can lead to fines of $2500 per breach or more - enough to cripple many smaller businesses. In extreme cases of intentional misuse, criminal litigation can even lead to prison sentences.

To learn more about the Fair Credit Reporting Act visit the Federal Trade Commission website.

More Inside {see} Digital Magazine

View Our Other Articles From This Issue of {see} Magazine

SIDESTEPPING AN "IDENTITY" CRISIS

I’LL JUST PAY CASH

FUNNY, YOU DON’T SOUND TEXAN

TAPPING THE CREDIT UNDERSERVED MARKET

ALTERNATIVE DATA REPOSITORY

FAIR CREDIT REPORTING RISK-BASED PRICING REGULATIONS

 
 
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