The U.S. House of Representatives passed H.R. 3621, the Comprehensive CREDIT Act of 2020, on January 29th largely across party lines. The bill now heads to the U.S. Senate where it will face tougher opposition and will likely be defeated.
H.R. 3621 would amend the Fair Credit Reporting Act (FCRA) to prohibit Consumer Reporting Agencies (CRAs) such as Asurint from providing a credit report to be used for employment purposes unless there was an applicable exemption. The exemptions are narrow in scope including: (i) required to obtain the report in accordance with a federal, state or local law or regulation; (ii) information in the report is being used with respect to a national security investigation; or (iii) the report is necessary for a background check or related investigation of financial information as required by a federal, state or local law or regulation.
If an employer meets an exemption, they must make a specific disclosure to the candidate prior to obtaining such a credit report. This disclosure includes an explanation the report is being obtained for employment purposes, the reasons for obtaining the report and the citation to the applicable law or regulation being relied upon as the exemption. Arguably this provision could be interpreted to require a separate disclosure solely for credit check purposes beyond the disclosure employers already provide consumers.
Additionally, the bill includes adverse action requirements that would require inclusion of the following in a pre-adverse action letter: the name, address and telephone number of the CRA that furnished the report, the date on which the report was furnished and the specific factors from the report upon which the adverse action is based.
H.R. 3621 also includes a number of amendments to the FCRA including with respect to the reinvestigation process CRAs are required to follow in the event information on the consumer report is disputed by a consumer.
H.R. 3621 would amend the Fair Credit Reporting Act (FCRA) to prohibit Consumer Reporting Agencies (CRAs) such as Asurint from providing a credit report to be used for employment purposes unless there was an applicable exemption. The exemptions are narrow in scope including: (i) required to obtain the report in accordance with a federal, state or local law or regulation; (ii) information in the report is being used with respect to a national security investigation; or (iii) the report is necessary for a background check or related investigation of financial information as required by a federal, state or local law or regulation.
If an employer meets an exemption, they must make a specific disclosure to the candidate prior to obtaining such a credit report. This disclosure includes an explanation the report is being obtained for employment purposes, the reasons for obtaining the report and the citation to the applicable law or regulation being relied upon as the exemption. Arguably this provision could be interpreted to require a separate disclosure solely for credit check purposes beyond the disclosure employers already provide consumers.
Additionally, the bill includes adverse action requirements that would require inclusion of the following in a pre-adverse action letter: the name, address and telephone number of the CRA that furnished the report, the date on which the report was furnished and the specific factors from the report upon which the adverse action is based.
H.R. 3621 also includes a number of amendments to the FCRA including with respect to the reinvestigation process CRAs are required to follow in the event information on the consumer report is disputed by a consumer.