FCRA (Fair Credit Reporting Act)

The Fair Credit Reporting Act, passed in 1970 and codified at 15 U.S.C. 1681 and following sections, regulates the companies that collect and sell information about you, including the three major credit bureaus, tenant and employment screening companies, and specialty reporting agencies. It also regulates the businesses that use these reports and the companies that furnish data to them.

Key rights under the FCRA include access to your file, the right to dispute inaccurate information and have it investigated, limits on who can see your report, time limits on reporting most negative information, and notice when a report is used against you. Employers must follow special disclosure and consent rules before running background checks.

Under 15 U.S.C. 1681n, a person harmed by a willful FCRA violation can recover actual damages or statutory damages of $100 to $1,000, plus possible punitive damages and attorney fees. Negligent violations allow actual damages and fees under section 1681o. Statutory damages make class actions practical when a company's procedures affect many people the same way, such as reporting discharged debts as owed, mixing files, or using improper background check forms.

Before suing over an error, dispute it in writing with the credit bureau and keep copies; the dispute record is often key evidence. Read our FCRA guide, how to dispute a credit report error, and the credit report errors page. Related entries include FACTA and credit report.