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Eric Dunn, Staff Attorney
Northwest Justice Project
401 Second Ave. S., Ste. 407
Seattle, Washington 98104
Tel. (206) 464-1519, ext. 234
EricD@nwjustice.org 1

Ermergerd. Mah permernernt rekerd!
Many people believe there exists, in
some mysterious place, a single,
meticulously updated “permanent
record” on each person that is
accessible to employers, housing
providers, educational institutions,
lenders, police and other government
agencies, et al.
2

Information is kept in disparate places. Data miners gather
information and generate “consumer reports.” Different
consumer reports come from different sources and contain
different types of information.

3

What is a “Consumer Report?”
“[A]ny written, oral, or other communication of
any information by a consumer reporting
agency bearing on a consumer’s credit
worthiness, credit standing, credit capacity,
character, general reputation, personal
15 USC 1681a(d) characteristics, or mode of living which is used
RCW 19.182.010(4)(a) or expected to be used or collected in whole or
in part for the purpose of serving as a factor in
establishing the consumer’s eligibility for— (A)
credit or insurance to be used primarily for
personal, family, or household purposes; (B)
employment purposes; or (C) any other
purpose authorized under [15 USC] 1681b.”

4

Consumer Report: Redux
Any written, oral, or other communication

By a consumer reporting agency

Of any information bearing on a consumer’s:
• Credit worthiness, standing, capacity,
• Character, reputation, characteristics, mode of living

Used or collected, wholly or partly, as factor for:
• Consumer credit, insurance, housing, employment
• License or other government benefit
• Other legitimate business need:
• Transaction initiated by consumer; or
• In connection with existing account
5

Investigative Consumer Reports
• Consumer report that includes information “obtained
through personal interviews with neighbors, friends,
or associates . . . or with others with whom the
consumer is acquainted or who may have knowledge”
– 15 USC 1681a(e); RCW 19.182.010(10)

Consumer Reports: Exclusions (RCW 19.182.010(4)(b))

Report solely concerning transactions or experiences between the consumer
and the person making the report

A report by a credit card (or similar device) issuer approving or authorizing a
specific extension of credit

A report to a third party, who requested a specific extension of credit directly to
a consumer, whether or not to extend the credit, if consumer is informed

A list compiled by a CRA for a client to use in direct marketing of goods or
services (but not offers of credit)

A report solely conveying a decision whether to guarantee a check in response
to a third party’s request

A report furnished in connection with commercial credit

Common Consumer Reports
Financial credit reports

Criminal background checks

Landlord/Employment verification

Reference interviews

Banking/checking account reports

Professional licensing reports
8

Most “specialty” screening reports, such
as employee background checks used in
hiring and promotion decisions, or
“tenant-screening reports” that
residential landlords use for choosing
tenants, are actually compilations that
combine multiple consumer reports into
a single package.

9

Eviction
Credit

Criminal

Tenant/Employment Screening Report
10

Fair Credit Reporting Act (X2)

• Federal: 15 USC 1681 et seq.
• State: RCW 19.182 et seq.
• To whom the FCRAs pertain:
• Consumer Reporting Agencies
• Users (of consumer reports)
• Furnishers (of consumer information)
• Federal only

• Who may obtain a
consumer report
What • When a consumer report
the may be procured
FCRAs • What consumer report
may contain
regulate • How CRAs must prepare
consumer reports

12

Consumer Reporting Agencies

“The term “consumer reporting agency” means any
person which, for monetary fees, dues, or on a
cooperative nonprofit basis, regularly engages in
whole or in part in the practice of assembling or
evaluating consumer credit information or other
information on consumers for the purpose of
furnishing consumer reports to third parties, and
which uses any means or facility of interstate
commerce for the purpose of preparing or
furnishing consumer reports.”
-- 15 USC 1681a(f)
-- RCW 19.182.010(5)

CRAs: Evil Private Corporations

“Big 3” Financial Tenant/EmploymentO Other specialty CRAs
On-Site Manger, HireRight,
Credit Reports FAS, Kroll Factual Data • Chexsystems, Fair
• Criminal Background
Isaacs, etc.
• Equifax, Experian,
TransUnion • Choicepoint
(LexisNexis), Intelius,
USIS

Furnishers
Public Other Specialty Screening
Records CRAs

Step 1: CRA obtains
information from
(private ) furnishers,
CRA public records, and
other CRAs

Step 2: CRA compiles
information into a
User report, transmits to
end users (such as
landlords, employers)
16

What does a consumer
report look like?

17

Miscellaneous
Disclaimers

Credit Information

ID Verification

Employment
Verification

Terrorist Database
Search

Public Records
Disclaimer 18

Reference Check

Criminal History

Sex Offender Check

19

Eviction History

Collection Accounts &
Civil Judgments

Recommendations

20

Outdated Information
• Both federal & state
FCRAs prohibit reporting
of certain records after a
period of time
• 15 USC 1681c(a)
• RCW 19.182.040(1)
– Certain exceptions apply
– State & federal statutes
are not the same

21

Time Limits: Federal (15 USC 1681c(a)

Bankruptcy • 10 years from adjudication

Collection, tax • 7 years from date of entry, or
lien, civil suit/
jdgmt, arrest • Limitations period expires

Any other adverse
information, • 7 years
except convictions

22

Time Limits: State (RCW 19.182.040)

Bankruptcy • 10 years from adjudication
Collections, tax liens,
civil suit/ jdgmt, adult • 7 years or limitations period
criminal record

Juvenile Record • Until subject is age 21

Any other adverse
information • 7 years

23

Federal: State:
Credit or life Credit or life
insurance with insurance with
$150k < principal $50K < principal

Employment Employment
application if application if
$75K < salary $20K < salary
24

“Whenever a consumer reporting agency
prepares a consumer report it shall follow
reasonable procedures to assure maximum
possible accuracy of the information concerning
the individual about whom the report relates.”
-- 15 USC 1681e(b);
RCW 19.182.060(2)

25

• Information one CRA
obtains from another
Resale of • Original CRA has duty to follow
Consumer reasonable procedures to assure
maximum possible accuracy
Reports • Reseller must accurately report
the original information
• 15 USC 1681e(e)

26

To be of “maximum
possible accuracy,”
information must be:
• True
• Complete
• Presented in a way
that is not misleading

27

Criminal Records – 1 Found!
State: WA County: King No 99-00000-0 D: GUILTY
Charge: Burglary 2° (Felony) Sentence: PROB 36 mo
Notes:

Hint: If this report was made in connection with a
2011 transaction, might it interest the user to know
that the offense and disposition occurred in 2000?

28

CRA not liable
for inaccurate
report alone
• Consumer must show
prima facie case:
Two-step inaccurate report
analysis: • CRA can avoid liability
by proving it followed
reasonable procedures

29

15 USC 1681i; RCW 19.182.090

30

Dispute Procedure: Summary

Consumer may dispute item with CRA

CRA must “reinvestigate” the disputed information
item within 30 days

CRA must correct or delete the disputed information
item unless verified

CRA must notify user(s) if information is changed or
deleted as a result of a dispute
31

FCRA Disputes (II)

CRA must use reasonable
procedures to reinvestigate,
verify disputed information CRA may not charge a fee
• Must consider information consumer
for reinvestigating
submits

CRA must notify furnisher of Dispute Statements
disputed item • If reinvestigation does not resolve
• Federal FCRA permits consumer to dispute, consumer may file “brief
lodge dispute directly with furnisher, 15 statement setting forth the nature of
USC 1681s-2 the dispute” for inclusion in future
reports

32

Automated Reinvestigation (e-Oscar)
• 15 USC 1681i(a)(5)(D):
“Any consumer reporting agency that compiles and maintains files on
consumers on a nationwide basis shall implement an automated
system through which furnishers of information to that consumer
reporting agency may report the results of a reinvestigation that finds
incomplete or inaccurate information in a consumer’s file to other such
consumer reporting agencies.”
– e-Oscar (www.e-Oscar.org)
• ACDVs initiated by a CRA on behalf of a consumer are routed to the
appropriate Data Furnisher [and] is returned to the initiating CRA with
updated information (if any) relating to the consumer's credit history. If an
account is modified or deleted, carbon copies are sent to each CRA with
whom the DF has a reporting relationship.
• Plain English: nationwide CRAs must subscribe to a system
that enables furnishers to automatically update consumer
information on file with the CRAs

Remedies: Federal FCRA
• Negligent Violations (15 USC 1681o)
– Actual damages
– Costs & Attorney Fees
• Willful Non-Compliance (15 USC 1681n)
– Actual or statutory damages ($100 to $1,000)
– Punitive damages (as determined by court)
– Costs & Attorney Fees
• Guimond v. Trans Union, 45 F.3d 1329 (9th Cir. 1995)
– Denial of credit not a prerequisite for actual damages
– Actual damages can be emotional distress/humiliation

Remedies: Washington CPA
• Violation of state FCRA is per se violation of
Wash. Consumer Protection Act, RCW 19.86
• Relief available:
– Actual damages
– Costs of action & Attorney Fees
– $1,000 “penalty” for a willful violation

End Users (of consumer reports)

Pre-screening • Employment: RCW 19.182.020(2)
disclosures • Housing: RCW 59.18.257(1)(a)

Content • Employment: RCW 19.182.020(2)(c) (credit info.)
restrictions • Housing: None (but see S.L. 6315 of 2012)

Pre-adverse • Employment only: RCW 19.182.020(2)(d)
action notice
Adverse • General: RCW 19.182.110
action notice • Housing only: RCW 59.18.257(1)(c)

36

Furnisher Duties
• 15 USC 1681s-2 (Federal FCRA Only)
– May not furnish information to a CRA if:
• Person “knows or has reasonable cause to believe that the
information is inaccurate;” or
• Information is inaccurate and consumer has notified the
furnisher of the inaccuracy
– Must correct and update information
• Person must regularly furnish information to CRAs
• Duty to promptly notify CRA of inaccurate information
– Must inform CRA if consumer disputes item
• Nelson v. Chase Manhattan Mtg. Corp., 282 F.3d 1057 (9th Cir. 2002)
– Private cause of action against furnisher for violation

Furnisher Disputes
• Consumers may dispute item directly with furnisher
– 15 USC 1681i(a)(8) will entitle
– Dispute must:
• Identify specific information disputed
• Explain basis for dispute & evidence
• Delivered to furnisher at proper address
– Furnisher must:
• Investigate (same basic procedures as CRA)
• Written notice of determination to consumer
• Promptly report any corrections to CRAs
– FTC regulations: 16 CFR 660.4

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