President Inks Reauthorization of Fair Credit Reporting Act

President Bush on Thursday signed the Fair and Accurate Credit Transactions Act of 2003, legislation that permanently reauthorizes seven expiring provisions of the federal Fair Credit Reporting Act (FCRA).

“Permanent reauthorization of the FCRA was one of our highest legislative priorities in 2003,” said Carl Parks, senior vice president, government relations for the National Association of Independent Insurers. “We are pleased that both Congress and President Bush recognized the importance of keeping in place a uniform national credit system that benefits both consumers and businesses.”

The Act renews current federal reporting preemptions that are the basis for the national credit reporting system. It also provides tools to enhance the accuracy of consumer credit information, ensures consumer access to such reports, and helps prevent fraud and identity theft. The measure also adds new provisions to the FCRA that allow consumers to opt out of marketing solicitations based on information shared between affiliated businesses.

“While insurers were not successful in amending all of the affiliate sharing provisions, we will continue to work with regulators to make certain that the best interests of companies and consumers are met as the new components of the law are implemented,” said Parks.

Also included in the new law is a provision calling for the Federal Trade Commission and the Federal Reserve Board, in conjunction with the Office of Fair Housing and Equal Opportunity of the Department of Housing and Urban Development, to conduct a study on the financial services industry’s use of credit scores. Specific details and definitions of study parameters were not included in the legislative language.

NAII will reportedly work with government officials responsible for designing and conducting the study to assure that such a project utilizes appropriate methodologies and information that will produce accurate and objective results.