The Integrity News
Vol. XII No. 26
September 18, 2003
"objective risk management services"
September 19, 2003
Numerous powerful organizations have
very strong opinions about, and large
vested interests in, various parts of these
potential amendments. The following is
the status of these proposed amendments
as we understand them today.
The Title of the House version of the FCRA
amendments (HR 2622 EH), which passed the
House on 9/10/03, and was sent to the Senate
on 9/11/03, is the:
"Fair and Accurate Credit Transactions Act of 2003"
The stated mission of the Act is "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."
Apparently, the driving force behind having this
legislation appear at this time is the fact that
"the national uniformity of key provisions in the
FCRA is currently scheduled to expire January 1,
The banking, insurance, stock brokerage, and other
industries want one national standard that cannot
be over-ridden by State laws on this issue. They
want Federal law to preempt State law. California
has just passed a tough new privacy law which would
be nullified, for instance, by the Federal law the way
that it is currently written.
These industry groups seem to have two major goals:
(1) they don't want to have to deal with the prospect
of 50 different sets of State privacy laws. However,
there are numerous organizations, and the States
themselves, that say the States should have the right
to regulate their own privacy standards. And, (2)
these industry groups want to be able to use a single,
more relaxed, national standard for their affiliate
Because of the momentum created by these industry
groups to get FCRA amendments yet this year on this
preemption issue, two other primary efforts appear to
have been rolled into this Act.
One of these other efforts is backed by all of the
advocates wanting tighter legislation to help prevent
Identity Theft. They have gotten their portion of
these amendments also. The States feel that by
having a State's right to create identity theft protections
permanently preempted, they would have their ability
to protect their citizens impaired.
The other primary effort is by the group of law firms
and investigators who want to be able to freely
investigate their client's employees who are suspected
of wrong-doing, without becoming Consumer Reporting
Agencies as defined under the FCRA, and without
being encumbered by certain privacy requirements of
the current FCRA law.
There are many other issues addressed by these
proposed amendments such as: fraud alerts, truncation
of credit and debit card account numbers, blocking
the use of information created by identity theft,
resolving consumer disputes, reasonable investigation,
accuracy of consumer reports, disputed information,
re-pollution of consumer reports with bad information,
consumer access to credit reports and credit scores,
unsolicited offers to consumers, sharing of medical
information, and consumer financial literacy, among
Then, there are the issues that are not addressed such
as: using credit scores for insurance purposes, debt
collection on consumers who were victims of identity
theft, notification to consumers of database security
breaches, protecting consumers against credit card
interest rates being tied to credit scores, the right of
a consumer to freeze access to their credit file, and
issues of disparate impact, among others.
The reason for this issue of
The Integrity News is to
give our subscribers a heads-up on this proposed new
legislation, especially Title VI - Protecting Employee
Misconduct Investigations. "A great deal of the
( original ) impetus for the FCRA was not errors in
credit reports, but abuses in investigative reports,
including reports relating to employment."
"This provision ( Title VI ) would exclude employer
investigations of sexual harassment or other workplace
violations from the FCRA's requirement that employees
(wrongdoers OR victims) be notified of third party
investigations of 'suspected misconduct' and be given
a copy of the consumer report if an adverse action is
taken." That is, notice, authorization, and giving the
accused the details of the resulting report, would not
be required for an adverse action resulting from an
Employee Misconduct Investigation.
It seems like Title VI in its current form would provide
plenty of room for serious abuses. A law this broad
could lead to the assumption that every investigated
employee is guilty. "The accusation against the
employee may: be malicious, be vindictive, be
discriminatory because of sex, reflect labor organization
bias, show minority discrimination, or show that the
employee is simply disliked by someone."
It further seems that not having to tell the accused who
their accusers are, nor give them the details of the
investigative report that resulted in the adverse action,
will lead to an un-ending series of legal actions against
STAY TUNED --- there is surely more to come !