Terms and Conditions for Requesters

1. Acceptance of Terms

These Terms and Conditions (“Agreement”) govern the use of our employment verification service (“Service”) by persons or businesses (“you” and ”your”) that would like to verify the employment information of an employee. You agree that by creating an account with Zethos, Inc. (“we”, “us” and “our”), or accessing or using our Service, you agree to this Agreement.

Your use of our Service is subject to this Agreement.

2. General Use

You will be granted the authority to access our Service to request employment reports. You will not have any ownership, or other rights of use of our Service, including the sale or resale, licensing, assembling or evaluation of our Service. You are not permitted to give access to our Service to any person other than your designated officer who uses our Service on your behalf. The actions and omissions of your designated officer are deemed to be your own actions and omissions. You are responsible for all the actions or omissions of your designated officer. You will not compile store or in any way create your own database of information obtained via our Service. You certify that you will hold this information in strict confidence and not disclose the information obtained from our Service to any person other than your designated officer.

3. Requester License

We grant to you a revocable, nonexclusive, nontransferable, royalty free, limited license during the term of this Agreement to use our Service to request employment reports, subject to the terms and conditions of this Agreement and our policies and procedures. We may at any time terminate this license. Requesters and their employers shall have no implied license. We reserve any rights not expressly granted in this Agreement.

Your obligations and the Fair Credit Reporting Act

You agree that your use of our Service will be in compliance with applicable law, including the Fair Credit Reporting Act (“FCRA”).

As a user of our Service, you understand that the employment report provided by us is a “consumer report” as defined by the FCRA, and you certify that you will request an employment report from our Service only when you intend to use the report in compliance with the FCRA and any applicable state law governing consumer reports.

You understand that you must have a permissible purpose under the FCRA to obtain an employment report. You represent that you have a permissible purpose under the FCRA to obtain an employment report. Section 604 of FCRA contains a list of the permissible purposes under FCRA. These are:

(a) As ordered by a court or a federal grand jury subpoena.

(b) In accordance with the written instructions of the employee.

(c) In connection with a credit transaction involving the employee or the review or collection of an employee’s account.

(d) For employment purposes, including hiring and promotion decisions, where the employee has given prior written consent.

(e) For the underwriting of insurance as a result of an application from an employee.

(f) To review an employee’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant’s financial responsibility or status.

(g) For use by a potential investor or servicer, or current insurer, in a valuation or assessment of the credit or prepayment risks associated with an existing credit obligation.

(h) When there is a legitimate business need, in connection with a business transaction that is initiated by the employee.

(i) When there is a legitimate business need to review an account to determine if the employee continues to meet the terms of the account.

(i) For use by state and local officials in connection with the assessment of child support obligations.

You must designate and provide us with the particular permissible purpose for which the employment report is being obtained and certify that the employment report will not be used for any other purpose.

You also are required by the FCRA to notify employees when adverse action is taken based in whole or in part on any information in the employment report. Adverse action includes all business, credit, insurance and employment actions that have an adverse or unfavorable impact on the employee, such as denying a loan, denying or cancelling credit insurance, or denying employment or promotion. Adverse action also includes denying an apartment lease application based on the employment report.

FCRA also requires that we provide to you as a user of a consumer report a prescribed notice on the FCRA responsibilities of users of consumer reports. The Notice to Users is attached to this Agreement and provided to you with each employment report you receive, , and you acknowledge that you received and read and understood the notice provided to you. The Notice to Users describes your obligations as a user of an employment report, and you should be aware that when taking adverse action for employment purposes, there are additional disclosures required before adverse action is taken. You agree that you will comply with these additional requirements.

5. No warranty

WE DO NOT WARRANT THAT OUR SERVICE WILL BE UNINTERRUPTED OR ERROR FREE. WE DO NOT MAKE ANY WARRANTY AS TO THE RESULTS THAT MAY BE OBTAINED FROM USE OF OUR SERVICE. OUR SERVICE IS PROVIDED “AS IS” AND WE DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT.

6. Limitation of liability

WE AND OUR AFFILIATES AND ANY OF OUR AND OUR AFFILIATES’ RESPECTIVE OWNERS, DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, AND REPRESENTATIVESWILL NOT BE RESPONSIBLE OR LIABLE UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY FOR: (A) ERROR OR INTERRUPTION OF USE OR FOR LOSS OR INACCURACY OR CORRUPTION OF DATA OR COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR TECHNOLOGY OR LOSS OF BUSINESS; (B) ANY INDIRECT, EXEMPLARY, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS); (C) ANY MATTER BEYOND OUR REASONABLE CONTROL; OR (D) ANY AMOUNTS THAT, TOGETHER WITH AMOUNTS ASSOCIATED WITH ALL OTHER CLAIMS, EXCEED THE GREATER OF THE AGGREGATE FEES PAID BY YOU TO US FOR OUR SERVICE IN THE 12 MONTHS PRIOR TO THE ACT THAT GAVE RISE TO THE LIABILITY OR $100.

SOME JURISDICTIONS DO NOT ALLOW THE DISCLAIMER OR EXCLUSION OF CERTAIN WARRANTIES OR THE LIMITATION OR EXCLUSION OF LIABILITY FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES. ACCORDINGLY, SOME OF THE ABOVE LIMITATIONS SET FORTH ABOVE MAY NOT APPLY TO YOU OR BE ENFORCEABLE WITH RESPECT TO YOU. IF YOU ARE A USER FROM NEW JERSEY, THE FOREGOING SECTIONS TITLED “NO WARRANTY” AND “LIMITATION OF LIABILITY” ARE INTENDED TO BE ONLY AS BROAD AS IS PERMITTED UNDER THE LAWS OF THE STATE OF NEW JERSEY. IF ANY PORTION OF THESE SECTIONS IS HELD TO BE INVALID UNDER THE LAWS OF THE STATE OF NEW JERSEY, THE INVALIDITY OF SUCH PORTION SHALL NOT AFFECT THE VALIDITY OF THE REMAINING PORTIONS OF THE APPLICABLE SECTIONS.

6. Your indemnification of us

You agree to defend, indemnify and hold harmless us and our affiliates and our and our affiliates’ respective owners, directors, officers, employees, agents and representatives from and against all claims, suits, actions, proceedings, losses, liabilities, damages, penalties, fines, fees (including attorneys’ fees) costs and expenses, whether in tort, contract, or otherwise, that arise out of or relate to any breach of this Agreement by you or your use of our Service.

7. Amendments

This Agreement may be updated from time to time. You should check our website (www.truework.com/terms/requesters) regularly for updates to this Agreement. Modifications take effect as soon as they are posted to this website, delivered to you, or made available to you. We may, in our discretion, modify or discontinue our Service at any time with or without notice.

8. Governing law and arbitration

California law will govern this Agreement without regard to its conflicts of laws provisions.

ANY DISPUTE OR CLAIM RELATING IN ANY WAY TO THE SERVICE OR THIS AGREEMENT WILL BE RESOLVED BY BINDING ARBITRATION, RATHER THAN IN COURT, except that you may assert claims in small claims court if your claims qualify. The Federal Arbitration Act governs the interpretation and enforcement of this provision; the arbitrator will apply California law to all other matters. Any party to the arbitration may at any time seek injunctions or other forms of equitable relief from any court of competent jurisdiction. WE EACH AGREE THAT ANY AND ALL DISPUTES MUST BE BROUGHT IN THE PARTIES' INDIVIDUAL CAPACITY AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. BY ENTERING INTO THIS AGREEMENT AND AGREEING TO ARBITRATION, YOU AGREE THAT YOU AND US ARE EACH WAIVING THE RIGHT TO FILE A LAWSUIT AND THE RIGHT TO A TRIAL BY JURY. IN ADDITION, YOU AGREE TO WAIVE THE RIGHT TO PARTICIPATE IN A CLASS ACTION OR LITIGATE ON A CLASS-WIDE BASIS. YOU AGREE THAT YOU HAVE EXPRESSLY AND KNOWINGLY WAIVED THESE RIGHTS.

Before beginning arbitration, you or we must first send a claim notice requesting arbitration. Claims will be referred to the American Arbitration Association (“AAA”). Arbitration will be conducted by the AAA, before a single AAA arbitrator and under the AAA’s commercial arbitration rules, which are available at www.adr.org or by calling 1-800-778-7879. Payment of all filing, administration and arbitrator fees and costs will be governed by the AAA's commercial arbitration rules. You or we may choose to have the arbitration conducted by telephone, based on written submissions, or in person in San Francisco, California. The decision of the arbitrator will be final and not appealable, and judgment on the arbitration award may be entered in any court having jurisdiction.

9. Fees

We charge a fee for each employment report, and this fee will be listed on the screen from which a report may be ordered online.

10. Termination; survival

We may suspend or terminate your use of our Service if we determine in our sole discretion that you are not complying with this Agreement or for any other reason. The terms of this Agreement will survive suspension or termination of this Agreement.

All users of consumer reports must comply with all applicable regulations, including regulations promulgated after this notice was first prescribed in 2004. Information about applicable regulations currently in effect can be found at the Consumer Financial Protection Bureau’s website, www.consumerfinance.gov/learnmore.

NOTICE TO USERS OF CONSUMER REPORTS: OBLIGATIONS OF USERS UNDER THE FCRA

The Fair Credit Reporting Act (FCRA), 15 U.S.C. §1681-1681y, requires that this notice be provided to inform users of consumer reports of their legal obligations. State law may impose additional requirements. The text of the FCRA is set forth in full at the Bureau of Consumer Financial Protection’s website at www.consumerfinance.gov/learnmore.

At the end of this document is a list of United States Code citations for the FCRA. Other information about user duties is also available at the Bureau’s website. Users must consult the relevant provisions of the FCRA for details about their obligations under the FCRA.

The first section of this summary sets forth the responsibilities imposed by the FCRA on all users of consumer reports. The subsequent sections discuss the duties of users of reports that contain specific types of information, or that are used for certain purposes, and the legal consequences of violations. If you are a furnisher of information to a consumer reporting agency (CRA), you have additional obligations and will receive a separate notice from the CRA describing your duties as a furnisher.

I.  OBLIGATIONS OF ALL USERS OF CONSUMER REPORTS

 

A.  Users Must Have a Permissible Purpose

 

Congress has limited the use of consumer reports to protect consumers’ privacy. All users must have a permissible purpose under the FCRA to obtain a consumer report. Section 604 contains a list of the permissible purposes under the law. These are:

 

    As ordered by a court or a federal grand jury subpoena. Section 604(a)(1)

    As instructed by the consumer in writing. Section 604(a)(2)

    For the extension of credit as a result of an application from a consumer, or the review or collection of a

consumer’s account. Section 604(a)(3)(A)

    For employment purposes, including hiring and promotion decisions, where the consumer has given written permission. Sections 604(a)(3)(B) and 604(b)

    For the underwriting of insurance as a result of an application from a consumer. Section 604(a)(3)(C)

    When there is a legitimate business need, in connection with a business transaction that is initiated by the consumer. Section 604(a)(3)(F)(i)

    To review a consumer’s account to determine whether the consumer continues to meet the terms of the

account. Section 604(a)(3)(F)(ii)

    To determine a consumer’s eligibility for a license or other benefit granted by a governmental

instrumentality required by law to consider an applicant’s financial responsibility or status. Section 604(a)(3)(D)

    For use by a potential investor or servicer, or current insurer, in a valuation or assessment of the credit or prepayment risks associated with an existing credit obligation. Section 604(a)(3)(E)

    For use by state and local officials in connection with the determination of child support payments, or modifications and enforcement thereof. Sections 604(a)(4) and 604(a)(5)

 

In addition, creditors and insurers may obtain certain consumer report information for the purpose of making “prescreened” unsolicited offers of credit or insurance. Section 604(c). The particular obligations of users of “prescreened” information are described in Section VII below.

 

B.  Users Must Provide Certifications

 

Section 604(f) prohibits any person from obtaining a consumer report from a consumer reporting agency (CRA) unless the person has certified to the CRA the permissible purpose(s) for which the report is being obtained and certifies that the report will not be used for any other purpose.


C. Users Must Notify Consumers When Adverse Actions Are Taken

 

The term “adverse action” is defined very broadly by Section 603. “Adverse actions” include all business, credit, and employment actions affecting consumers that can be considered to have a negative impact as defined by Section 603(k) of the FCRA – such as denying or canceling credit or insurance, or denying employment or promotion. No adverse action occurs in a credit transaction where the creditor makes a counteroffer that is accepted by the consumer.

 

1. Adverse Actions Based on Information Obtained From a CRA

 

If a user takes any type of adverse action as defined by the FCRA that is based at least in part on information contained in a consumer report, Section 615(a) requires the user to notify the consumer. The notification may be done in writing, orally, or by electronic means. It must include the following:

 

    The name, address, and telephone number of the CRA (including a toll-free telephone number, if it is a nationwide CRA) that provided the report.

    A statement that the CRA did not make the adverse decision and is not able to explain why the decision was made.

    A statement setting forth the consumer’s right to obtain a free disclosure of the consumer’s file from the

CRA if the consumer makes a request within 60 days.

    A statement setting forth the consumer’s right to dispute directly with the CRA the accuracy or

completeness of any information provided by the CRA.

 

2. Adverse Actions Based on Information Obtained From Third Parties Who Are Not Consumer Reporting Agencies

 

If a person denies (or increases the charge for) credit for personal, family, or household purposes based either wholly or partly upon information from a person other than a CRA, and the information is the type of consumer information covered by the FCRA, Section 615(b)(1) requires that the user clearly and accurately disclose to the consumer his or her right to be told the nature of the information that was relied upon if the consumer makes a written request within 60 days of notification. The user must provide the disclosure within a reasonable period of time following the consumer’s written request.

 

3. Adverse Actions Based on Information Obtained From Affiliates

 

If a person takes an adverse action involving insurance, employment, or a credit transaction initiated by the consumer, based on information of the type covered by the FCRA, and this information was obtained from an entity affiliated with the user of the information by common ownership or control, Section 615(b)(2) requires the user to notify the consumer of the adverse action. The notice must inform the consumer that he or she may obtain a disclosure of the nature of the information relied upon by making a written request within 60 days of receiving the adverse action notice. If the consumer makes such a request, the user must disclose the nature of the information not later than 30 days after receiving the request. If consumer report information is shared among affiliates and then used for an adverse action, the user must make an adverse action disclosure as set forth in I.C.1 above.

 

D. Users Have Obligations When Fraud and Active Duty Military Alerts are in Files

 

When a consumer has placed a fraud alert, including one relating to identify theft, or an active duty military alert with a nationwide consumer reporting agency as defined in Section 603(p) and resellers, Section 605A(h) imposes limitations on users of reports obtained from the consumer reporting agency in certain circumstances, including the establishment of a new credit plan and the issuance of additional credit cards. For initial fraud alerts and active duty alerts, the user must have reasonable policies and procedures in place to form a belief that the user knows the identity of the applicant or contact the consumer at a telephone number specified by the consumer; in the case of extended fraud alerts, the user must contact the consumer in accordance with the contact information provided in the consumer’s alert.

 

E. Users Have Obligations When Notified of an Address Discrepancy

 

Section 605(h) requires nationwide CRAs, as defined in Section 603(p), to notify users that request reports when the address for a consumer provided by the user in requesting the report is substantially different from the addresses in


the consumer’s file. When this occurs, users must comply with regulations specifying the procedures to be followed, which will be issued by the Consumer Financial Protection Bureau and the banking and credit union regulators.

 

The Consumer Financial Protection Bureau regulations will be available at www.consumerfinance.gov/learnmore/.

 

F.  Users Have Obligations When Disposing of Records

 

Section 628 requires that all users of consumer report information have in place procedures to properly dispose of records containing this information. The Consumer Financial Protection Bureau, the Securities and Exchange Commission, and the banking and credit union regulators have issued regulations covering disposal. The Consumer Financial Protection Bureau regulations may be found at www.consumerfinance.gov/learnmore/.

 

II.  CREDITORS MUST MAKE ADDITIONAL DISCLOSURES

 

If a person uses a consumer report in connection with an application for, or a grant, extension, or provision of, credit to a consumer on material terms that are materially less favorable than the most favorable terms available to a substantial proportion of consumers from or through that person, based in whole or in part on a consumer report, the person must provide a risk-based pricing notice to the consumer in accordance with regulations prescribed by the Consumer Financial Protection Bureau.

 

Section 609(g) requires a disclosure by all persons that make or arrange loans secured by residential real property (one to four units) and that use credit scores. These persons must provide credit scores and other information about credit scores to applicants, including the disclosure set forth in Section 609(g)(1)(D) (“Notice to the Home Loan

Applicant”).

 

III.  OBLIGATIONS OF USERS WHEN CONSUMER REPORTS ARE OBTAINED FOR EMPLOYMENT PURPOSES

 

A.  Employment Other Than in the Trucking Industry

 

If the information from a CRA is used for employment purposes, the user has specific duties, which are set forth in Section 604(b) of the FCRA. The user must:

 

    Make a clear and conspicuous written disclosure to the consumer before the report is obtained, in a document that consists solely of the disclosure, that a consumer report may be obtained.

    Obtain from the consumer prior written authorization. Authorization to access reports during the term of employment may be obtained at the time of employment.

    Certify to the CRA that the above steps have been followed, that the information being obtained will not be used in violation of any federal or state equal opportunity law or regulation, and that, if any adverse action is to be taken based on the consumer report, a copy of the report and a summary of the consumer’s rights will be provided to the consumer.

Before taking an adverse action, the user must provide a copy of the report to the consumer as well as the summary of consumer’s rights (The user should receive this summary from the CRA.) A Section 615(a) adverse action notice should be sent after the adverse action is taken.

 

An adverse action notice also is required in employment situations if credit information (other than transactions and experience data) obtained from an affiliate is used to deny employment. Section 615(b)(2).

 

The procedures for investigative consumer reports and employee misconduct investigations are set forth below.

 

B.  Employment in the Trucking Industry

 

Special rules apply for truck drivers where the only interaction between the consumer and the potential employer is by mail, telephone, or computer. In this case, the consumer may provide consent orally or electronically, and an adverse action may be made orally, in writing, or electronically. The consumer may obtain a copy of any report relied upon by the trucking company by contacting the company.


IV.  OBLIGATIONS WHEN INVESTIGATIVE CONSUMER REPORTS ARE USED

 

Investigative consumer reports are a special type of consumer report in which information about a consumer’s character, general reputation, personal characteristics, and mode of living is obtained through personal interviews by an entity or person that is a consumer reporting agency. Consumers who are the subjects of such reports are given special rights under the FCRA. If a user intends to obtain an investigative consumer report, Section 606 requires the following:

 

    The user must disclose to the consumer that an investigative consumer report may be obtained. This must be done in a written disclosure that is mailed, or otherwise delivered, to the consumer at some time before or not later than three days after the date on which the report was first requested. The disclosure must include a statement informing the consumer of his or her right to request additional disclosures of the nature and scope of the investigation as described below, and the summary of consumer rights required by Section 609 of the FCRA. (The summary of consumer rights will be provided by the CRA that conducts the investigation.)

    The user must certify to the CRA that the disclosures set forth above have been made and that the user will make the disclosure described below.

    Upon the written request of a consumer made within a reasonable period of time after the disclosures required above, the user must make a complete disclosure of the nature and scope of the investigation. This must be made in a written statement that is mailed or otherwise delivered, to the consumer no later than five days after the date on which the request was received from the consumer or the report was first requested, whichever is later in time.

 

V.  SPECIAL PROCEDURES FOR EMPLOYMEE INVESTIGATIONS

 

Section 603(x) provides special procedures for investigations of suspected misconduct by an employee or for compliance with Federal, state or local laws and regulations or the rules of a self-regulatory organization, and compliance with written policies of the employer. These investigations are not treated as consumer reports so long as the employer or its agent complies with the procedures set forth in Section 603(x), and a summary describing the nature and scope of the inquiry is made to the employee if an adverse action is taken based on the investigation.

 

VI.  OBLIGATIONS OF USERS OF MEDICAL INFORMATION

 

Section 604(g) limits the use of medical information obtained from consumer reporting agencies (other than payment information that appears in a coded form that does not identify the medical provider). If the information is to be used for an insurance transaction, the consumer must give consent to the user of the report or the information must be coded.  If the report is to be used for employment purposes – or in connection with a credit transaction (except as provided in regulations issued by the banking and credit union regulators) – the consumer must provide specific written consent and the medical information must be relevant. Any user who receives medical information shall not disclose the information to any other person (except where necessary to carry out the purpose for which the information was disclosed, or a permitted by statute, regulation, or order).

 

VII.  OBLIGATIONS OF USERS OF “PRESCREENED” LISTS

 

The FCRA permits creditors and insurers to obtain limited consumer report information for use in connection with unsolicited offers of credit or insurance under certain circumstances. Sections 603(1), 604(c), 604(e), and 614(d). This practice is known as “prescreening” and typically involves obtaining a list of consumers from a CRA who meet certain preestablished criteria. If any person intends to use prescreened lists, that person must (1) before the offer is made, establish the criteria that will be relied upon to make the offer and grant credit or insurance, and (2) maintain such criteria on file for a three-year period beginning on the date on which the offer is made to each consumer. In addition, any user must provide with each written solicitation a clear and conspicuous statement that:

 

    Information contained in a consumer’s CRA file was used in connection with the transaction.

    The consumer received the offer because he or she satisfied the criteria for credit worthiness or insurability used to screen for the offer.

    Credit or insurance may not be extended if, after the consumer responds, it is determined that the consumer does not meet the criteria used for screening or any applicable criteria bearing on credit worthiness or insurability, or the consumer does not furnish required collateral.


The consumer may prohibit the use of information in his or her file in connection with future prescreened offers of credit or insurance by contacting the notification system established by the CRA that provided the report. The statement must include the address and toll-free telephone number of the appropriate notification system.

 

In addition, the Consumer Financial Protection Bureau has established the format, type size, and manner of the disclosure required by Section 615(d), with which users must comply. The regulation is 12 CFR 1022.54.

 

VIII.  OBLIGATIONS OF RESELLERS

 

A.  Disclosure and Certification Requirements

 

Section 607(e) requires any person who obtains a consumer report for resale to take the following steps:

 

    Disclose the identity of the end-user to the source CRA.

    Identify to the source CRA each permissible purpose for which the report will be furnished to the end-user.

    Establish and follow reasonable procedures to ensure that reports are resold only for permissible purposes, including procedures to obtain:

(1)  the identify of all end-users;

(2)  certifications from all users of each purpose for which reports will be used; and

(3)  certifications that reports will not be used for any purpose other than the purpose(s) specified to the reseller. Resellers must make reasonable efforts to verify this information before selling the report.

 

B.  Reinvestigations by Resellers

 

Under Section 611(f), if a consumer disputes the accuracy or completeness of information in a report prepared by a reseller, the reseller must determine whether this is a result of an action or omission on its part and, if so, correct or delete the information. If not, the reseller must send the dispute to the source CRA for reinvestigation. When any CRA notifies the reseller of the results of an investigation, the reseller must immediately convey the information to the consumer.

 

C. Fraud Alerts and Resellers

 

Section 605A(f) requires resellers who receive fraud alerts or active duty alerts from another consumer reporting agency to include these in their reports.

 

IX.  LIABILITY FOR VIOLATIONS OF THE FCRA

 

Failure to comply with the FCRA can result in state government or federal government enforcement actions, as well as private lawsuits. Sections 616, 617, and 621. In addition, any person who knowingly and willfully obtains a consumer report under false pretenses may face criminal prosecution. Section 619.

 

The Consumer Financial Protection Bureau website, www.consumerfinance.gov/learnmore, has more information about the FCRA.


Citations for FCRA sections in the U.S. Code, 15 U.S.C. § 1618 et seq.:

 


 

Section 603


15 U.S.C. 1681

15 U.S.C. 1681a


Section 604                      15 U.S.C. 1681b

Section 605                      15 U.S.C. 1681c

Section 605A                    15 U.S.C. 1681c-1

Section 605B                    15 U.S.C. 1681c-2

Section 606                      15 U.S.C. 1681d

Section 607                      15 U.S.C. 1681e

Section 608                      15 U.S.C. 1681f

Section 609                      15 U.S.C. 1681g

Section 610                      15 U.S.C. 1681h

Section 611                      15 U.S.C. 1681i

Section 612                      15 U.S.C. 1681j

Section 613                      15 U.S.C. 1681k

Section 614                      15 U.S.C. 1681l

Section 615                      15 U.S.C. 1681m

Section 616                      15 U.S.C. 1681n

Section 617                      15 U.S.C. 1681o

Section 618                      15 U.S.C. 1681p

Section 619                      15 U.S.C. 1681q

Section 620                      15 U.S.C. 1681r

Section 621                      15 U.S.C. 1681s

Section 622                      15 U.S.C. 1681s-1

Section 623                      15 U.S.C. 1681s-2

Section 624                      15 U.S.C. 1681t

Section 625                      15 U.S.C. 1681u

Section 626                      15 U.S.C. 1681v

Section 627                      15 U.S.C. 1681w

Section 628                      15 U.S.C. 1681x

Section 629                      15 U.S.C. 1681y


All furnishers of consumer reports must comply with all applicable regulations, including regulations promulgated after this notice was first prescribed in 2004. Information about applicable regulations currently in effect can be found at the Consumer Financial Protection Bureau’s website, www.consumerfinance.gov/learnmore.

 

NOTICE TO FURNISHERS OF INFORMATION: OBLIGATIONS OF FURNISHERS UNDER THE FCRA

 

The federal Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681-1681y, imposes responsibilities on all persons who furnish information to consumer reporting agencies (CRAs). These responsibilities are found in Section 623 of the FCRA, 15 U.S.C. § 1681s-2. State law may impose additional requirements on furnishers. All furnishers of information to CRAs should become familiar with the applicable laws and may want to consult with their counsel to ensure that they are in compliance. The text of the FCRA is set forth in full at the Bureau of Consumer Financial Protection’s website at www.consumerfinance.gov/learnmore. A list of the sections of the FCRA cross-referenced to the U.S. Code is at the end of this document.

 

Section 623 imposes the following duties:

 

Accuracy Guidelines

 

The banking and credit union regulators and the CFPB will promulgate guidelines and regulations dealing with the accuracy of information provided to CRAs by furnishers. The regulations and guidelines issued by the CFPB will be available at www.consumerfinance.gov/learnmore when they are issued. Section 623(e).

 

General Prohibition on Reporting Inaccurate Information

The FCRA prohibits information furnishers from providing information to a CRA that they know or have reasonable cause to believe is inaccurate. However, the furnisher is not subject to this general prohibition if it clearly and conspicuously specifies an address to which consumers may write to notify the furnisher that certain information is inaccurate. Sections 623(a)(1)(A) and (a)(1)(C).

 

Duty to Correct and Update Information

 

If at any time a person who regularly and in the ordinary course of business furnishes information to one or more CRAs determines that the information provided is not complete or accurate, the furnisher must promptly provide complete and accurate information to the CRA. In addition, the furnisher must notify all CRAs that received the information of any corrections, and must thereafter report only the complete and accurate information. Section 623(a)(2).

 

Duties After Notice of Dispute from Consumer

 

If a consumer notifies a furnisher, at an address specified by the furnisher for such notices, that specific information is inaccurate, and the information is, in fact, inaccurate, the furnisher must thereafter report the correct information to CRAs. Section 623(a)(1)(B).

If a consumer notifies a furnisher that the consumer disputes the completeness or accuracy of any information reported by the furnisher, the furnisher may not subsequently report that information to a CRA without providing notice of the dispute. Section 623(a)(3).

 

The federal banking and credit union regulators and the CFPB will issue regulations that will identify when an information furnisher must investigate a dispute made directly to the furnisher by a consumer. Once these regulations are issued, furnishers must comply with them and complete an investigation within 30 days (or 45 days, if the consumer later provides relevant additional information) unless the dispute is frivolous or irrelevant or comes from a “credit repair organization.” The CFPB regulations will be available at www.consumerfinance.gov. Section 623(a)(8).

 

Duties After Notice of Dispute from Consumer Reporting Agency

 

If a CRA notifies a furnisher that a consumer disputes the completeness or accuracy of information provided by the furnisher, the furnisher has a duty to follow certain procedures. The furnisher must:


    Conduct an investigation and review all relevant information provided by the CRA, including information given to the CRA by the consumer. Sections 623(b)(1)(A) and (b)(1)(B).

    Report the results to the CRA that referred the dispute, and, if the investigation establishes that the information was, in fact, incomplete or inaccurate, report the results to all CRAs to which the furnisher provided the information that compile and maintain files on a nationwide basis. Sections 623(b)(1)(C) and (b)(1)(D).

    Complete the above steps within 30 days from the date the CRA receives the dispute (or 45 days, if the consumer later provides relevant additional information to the CRA). Section 623(b)(2).

    Promptly modify or delete the information, or block its reporting. Section 623(b)(1)(E).

 

Duty to Report Voluntary Closing of Credit Accounts

 

If a consumer voluntarily closes a credit account, any person who regularly and in the ordinary course of business furnishes information to one or more CRAs must report this fact when it provides information to CRAs for the time period in which the account was closed. Section 623(a)(4).

 

Duty to Report Dates of Delinquencies

 

If a furnisher reports information concerning a delinquent account placed for collection, charged to profit or loss, or subject to any similar action, the furnisher must, within 90 days after reporting the information, provide the CRA with the month and the year of the commencement of the delinquency that immediately preceded the action, so that the agency will know how long to keep the information in the consumer’s file. Section 623(a)(5).

 

Any person, such as a debt collector, that has acquired or is responsible for collecting delinquent accounts and that reports information to CRAs may comply with the requirements of Section 623(a)(5) (until there is a consumer dispute) by reporting the same delinquency date previously reported by the creditor. If the creditor did not report this date, they may comply with the FCRA by establishing reasonable procedures to obtain and report delinquency dates, or, if a delinquency date cannot be reasonably obtained, by following reasonable procedures to ensure that the date reported precedes the date when the account was placed for collection, charged to profit or loss, or subjected to any similar action. Section 623(a)(5).

 

Duties of Financial Institutions When Reporting Negative Information

 

Financial institutions that furnish information to “nationwide” consumer reporting agencies, as defined in Section 603(p), must notify consumers in writing if they may furnish or have furnished negative information to a CRA. Section 623(a)(7). The Consumer Financial Protection Bureau has prescribed model disclosures, 12 CFR Part 1022, App. B.

 

Duties When Furnishing Medical Information

 

A furnisher whose primary business is providing medical services, products, or devices (and such furnisher’s agents or assignees) is a medical information furnisher for the purposes of the FCRA and must notify all CRAs to which it reports of this fact. Section 623(a)(9). This notice will enable CRAs to comply with their duties under Section 604(g) when reporting medical information.

 

Duties when ID Theft Occurs

 

All furnishers must have in place reasonable procedures to respond to notifications from CRAs that information furnished is the result of identity theft, and to prevent refurnishing the information in the future. A furnisher may not furnish information that a consumer has identified as resulting from identity theft unless the furnisher subsequently knows or is informed by the consumer that the information is correct. Section 623(a)(6). If a furnisher learns that it has furnished inaccurate information due to identity theft, it must notify each consumer reporting agency of the correct information and must thereafter report only complete and accurate information. Section 623(a)(2).  When any furnisher of information is notified pursuant to the procedures set forth in Section 605B that a debt has resulted from identity theft, the furnisher may not sell, transfer, or place for collection the debt except in certain limited circumstances. Section 615(f).


The Consumer Financial Protection Bureau website, www.consumerfinance.gov/learnmore, has more information about the FCRA.

 

Citations for FCRA sections in the U.S. Code, 15 U.S.C. § 1681 et seq.:

 

 

15 U.S.C. 1681

Section 615

15 U.S.C. 1681m

Section 603

15 U.S.C. 1681a

Section 616

15 U.S.C. 1681n

Section 604

15 U.S.C. 1681b

Section 617

15 U.S.C. 1681o

Section 605

15 U.S.C. 1681c

Section 618

15 U.S.C. 1681p

Section 605A

15 U.S.C. 1681c-1

Section 619

15 U.S.C. 1681q

Section 605B

15 U.S.C. 1681c-2

Section 620

15 U.S.C. 1681r

Section 606

15 U.S.C. 1681d

Section 621

15 U.S.C. 1681s

Section 607

15 U.S.C. 1681e

Section 622

15 U.S.C. 1681s-1

Section 608

15 U.S.C. 1681f

Section 623

15 U.S.C. 1681s-2

Section 609

15 U.S.C. 1681g

Section 624

15 U.S.C. 1681t

Section 610

15 U.S.C. 1681h

Section 625

15 U.S.C. 1681u

Section 611

15 U.S.C. 1681i

Section 626

15 U.S.C. 1681v

Section 612

15 U.S.C. 1681j

Section 627

15 U.S.C. 1681w

Section 613

15 U.S.C. 1681k

Section 628

15 U.S.C. 1681x

Section 614

15 U.S.C. 1681l

Section 629

15 U.S.C. 1681y

 

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