[Congressional Record (Bound Edition), Volume 149 (2003), Part 16]
[House]
[Pages 21742-21789]
[From the U.S. Government Publishing Office, www.gpo.gov]




           FAIR AND ACCURATE CREDIT TRANSACTIONS ACT OF 2003

  The Committee resumed its sitting.
  Mr. OXLEY. Mr. Chairman, I am pleased to yield 2 minutes to the 
gentleman from the First State of Delaware (Mr. Castle), a valuable 
member of the Committee on Financial Services.
  Mr. CASTLE. Mr. Chairman, I thank the distinguished chairman of the 
committee and both the ranking member from Massachusetts for this good 
piece of legislation. Obviously I support the bill before us.
  This bipartisan legislation passed the House Committee on Financial 
Services by a vote of 61 to 3 in July of this year. We do not have a 
lot of votes with those kinds of numbers in it, an overwhelming 
endorsement which should obviously be noted by all of us.
  The legislation is a good, bipartisan bill. It is a result of six 
hearings, nearly 100 witnesses and months of deliberations. Through 
this very thorough process, the Committee on Financial Services has 
produced a bill that will protect the financial privacy and access to 
credit for all consumers, and it will help our economic recovery by 
ensuring businesses have access to accurate information which provides 
prompt credit to American consumers.
  As my colleagues know, one of the forces that has helped sustain our 
economy in recent years is consumer spending. A critical factor in 
enabling American consumers to purchase products when they need them 
and want them is our strong system of consumer credit. That system is 
supported by the Fair Credit Reporting Act which ensures the factual 
information is available on which to base the extension of credit. 
Virtually every business in this Nation and every consumer that has 
ever used credit depends on this system.
  One of my constituents, Michael Uffner, president, chairman and CEO 
of AutoTeam Delaware, testified before the committee this year. Mike 
Uffner stressed the importance of access to accurate credit information 
to serve customers in a timely and fair manner. Americans want to be 
able to walk into an automobile showroom and purchase an automobile 
that day based on a prompt approval of a loan based on their credit.
  In December, the national uniform consumer protection standards in 
the Fair Credit Reporting Act will expire. Without this legislation, 
there would be no national standards for consumer protections and 
credit availability. This will negatively affect consumer access to 
credit and the economy as a whole. A failure to pass this legislation 
would mean higher costs to consumers, who will be paying more for their 
credit without this legislation. In today's economy, in which we rely 
on instant credit available to us across the country, we need to have 
this legislation. This is uniformity, not a state-by-sate issue; and as 
Congress we must protect the consumers.
  Mr. Chairman, again, I want to express my strong support for this 
bill and urge my colleagues on both sides of the aisle to join the 63 
bipartisan members of the House Committee on Financial Services who 
worked together to craft the bill to protect consumers and give 
confidence to businesses. This is a proper step to ensure that all of 
our constituents have access to fair and reasonable credit information.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield 5 minutes to the 
gentleman from Pennsylvania (Mr. Kanjorski), the second-ranking member 
of the committee, the ranking member of our Subcommittee on Capital 
Markets, Insurance and Government Sponsored Enterprises, and one of the 
leaders in shaping this legislation.
  Mr. KANJORSKI. Mr. Chairman, I rise in strong support of H.R. 2622, 
the Fair and Accurate Credit Transactions Act of 2003.
  If we fail to extend the expiring provisions of the Fair Credit 
Reporting Act before the end of this year, conflicting State laws could 
place financial institutions in a difficult compliance position, and 
the current efficiencies in obtaining credit could significantly 
decrease. We would, moreover, create more difficulties for our already-
struggling economy. For example, according to a recent report 
commissioned by the Financial Services Roundtable, the loss of national 
uniform credit reporting standards would produce a 2 percent drop in 
the gross domestic product of this Nation.
  The Fair Credit Reporting Act in its 1996 amendments, in my view, 
have created a nationwide consumer credit system that works 
increasingly well. This law has expanded access to credit, lowered the 
price of credit, and accelerated decisions to grant credit. One reason 
that the law works so well is the establishment of the uniform system 
that preempts States from enacting miscellaneous and potentially 
conflicting requirements regarding credit reporting.
  As my colleagues may recall, Mr. Chairman, I strongly supported 
creating these preemptions in the 102nd, 103rd and 104th Congresses. I 
also believe that we should extend them now. I do not, however, think 
that they should be made permanent. Consequently, I will offer an 
amendment later today to address this issue.
  In addition to extending the expiring preemptions of State law, H.R. 
2622 will make a number of important improvements in current law with 
respect to consumer protection. These provisions, among other things, 
will improve the accuracy of and correction process for credit reports 
and establish strong privacy protections for consumers' sensitive 
medical information.
  Furthermore, identity theft is a growing problem in our country. A 
recent report by the Federal Trade Commission found that 27.3 million 
Americans have been victims of identity theft in the last 5 years. I 
am, therefore, particularly pleased that H.R. 2622 includes several 
provisions designed to combat these crimes and aid consumers.
  Mr. Chairman, I think this legislation is a high mark for this 
Congress, and I want to compliment the gentleman from Ohio (Mr. Oxley), 
chairman of the committee; the gentleman from Massachusetts (Mr. 
Frank), the ranking member of the committee; the gentleman from Alabama 
(Mr. Bachus), the chairman of the Subcommittee of the Financial 
Institutions and Consumer Credit; and the gentleman from Vermont (Mr. 
Sanders), our ranking member on that subcommittee.
  This legislation is a perfect example that good, spirited, bipartisan 
activity can accomplish much for this Congress and for this Nation. We 
have worked to try and work out all the efforts of so many individuals 
who would like favoritism or special interest reports and, in fact, 
have worked for the common good of both industry and the consumer; and 
I think, Mr. Chairman, we have accomplished that.
  So I congratulate my several Members that I mentioned and the full 
committee and this Congress. This is an extraordinarily successful 
piece of legislation that we should be proud of on a bipartisan basis.
  Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Georgia (Mr. Isakson).
  Mr. ISAKSON. Mr. Chairman, I thank the chairman for yielding me the 
time, and I want to commend the gentleman from Ohio (Mr. Oxley), the 
chairman, and the gentleman from Massachusetts (Mr. Frank), the ranking 
member, for the outstanding work

[[Page 21743]]

they have done on a bill that is critical to American business and 
enterprise and American consumers.
  I want to particularly thank the chairman for incorporating within 
the manager's amendment a provision that directs the FTC and the 
Treasury to promulgate rules and regulations for an orderly 
implementation and transition to the free credit reports called for in 
section 501.
  Mr. Chairman, the Fair Credit Reporting Act is critical to business 
in America. Identity theft and the protection of consumers from 
identity theft is critical, but time is also critical.
  By allowing the provision of free credit reports without an orderly 
transition for their seeking and a safe way for them to be sought could 
spike demand on the crediting reporting agencies and delay the reports 
of credit on those consumers seeking credit. For example, 2 weeks ago 
when home loans spiked in one day by a half a percent, a delay in the 
receipt of a credit report by a prospective home buyer seeking a 
mortgage could have cost them 10, 20, $50,000 over the life of the 
loan.
  I encourage the chairman to continue work with the Members and then 
later as this is implemented with the FTC to ensure that we have a safe 
way for the free credit report to be sought specifically either by the 
Internet or in writing, and secondly, for us to manage the flow so that 
the spikes in those requests do not damage the timeliness with which 
paying customers seeking credit in this country can receive an orderly 
report on their credit.
  The committee is doing America's consumers and the consistency of 
credit reporting in this country a great service by the bill. I commend 
the chairman for the manager's amendment, and I intend to support the 
bill fully.
  Mr. KANJORSKI. Mr. Chairman, I yield 3 minutes to the gentlewoman 
from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the gentleman very 
much for yielding me the time, and I rise to add my appreciation to the 
chairman of this committee and the ranking member. The chairman and the 
ranking member have truly evidenced the importance of the Committee on 
Financial Services and its bipartisan effort. These are issues I 
believe that really cross partisan lines and, more particularly, impact 
the humanity of those who may be facing some of the disasters that may 
come through the lack of fair credit reporting and as well the whole 
issue of identity theft.
  I thank both the ranking member and the chairman of the subcommittees 
that were relevant to this particular legislation; and I rise to 
support it and to highlight a particular aspect of the legislation that 
I am very proud of, and I want to congratulate the committee for its 
astuteness and wisdom on this very important issue.
  Title VI, protecting employees' misconduct and investigation, tracks 
the legislation that I cosponsored along with the gentleman from Texas 
(Mr. Sessions), the gentleman from Massachusetts (Mr. Frank), and other 
Members of this body that frankly deals with a question that is minute 
maybe but is large in terms of the needs that it covers.
  The legislation was called the Civil Rights and Employee 
Investigation Clarification Act, and I am very delighted that title VI 
in this legislation really responds to the concerns that are raised, 
and that is, that the Fair Credit Reporting Act, as interpreted by the 
Federal Trade Commission, sometimes impedes investigations of workplace 
misconduct.
  Mr. Chairman, in particular, it deals with or undermines or did 
undermine the ability of employers to use experienced, outside 
organizations or individuals to investigate allegations of drug use or 
sales, violence, sexual harassment, other types of harassment, 
employment discrimination, job safety and health violations, as well as 
criminal activity, including theft, fraud, embezzlement, sabotage or 
arson, patient or elder abuse, child abuse and other types of 
misconduct related to employment. This was not the intention of the 
Fair Credit Reporting Act, but by its interpretation this is what 
occurred.
  Employers have been advised by agencies and courts to utilize such 
experienced outside organizations and individuals in many cases to 
assure compliance with civil rights laws and other laws, as well as 
written workplace policies. That was crafted in order to give privacy 
to the employees and to the relationships that would help cure the 
problem so that there was a bridge or a firewall between the employers 
and the employees that might be caught up in the malfeasance or might 
be caught up in providing some insight in how do we correct these 
problems.
  Employees and consumers are put at risk because the Fair Credit 
Reporting Act frustrates or impedes employers in their efforts to 
maintain a safe and productive workforce and to create that firewall in 
order to protect those who would tell and those who would help remedy 
versus those who were creating the problem.
  This is an important piece of legislation, and title VI is 
particularly important in creating that firewall to ensure that not 
only do we have fair credit reporting, not only do we provide a 
protection for those suffering from identity theft, but we also provide 
the opportunity for truth and clarity in making sure that we have safe 
workforces and using the right kind of talent to do so.
  Mr. Chairman, I rise in support of the Fair and Accurate Credit 
Transactions Act of 2003 (``FACT Act''), only insofar as its adoption 
includes the full and unamended text of Title VI: ``Protecting Employee 
Misconduct Investigations.''


                          overbroad provision

  On April 5, 1999, the Federal Trade Commission (FTC) issued an 
opinion letter (the Vail letter), which stated that if an employer used 
experienced outside organizations to investigate employee misconduct, 
the investigation must comply with the notice and disclosure 
requirements of the Fair Credit Reporting Act (FCRA). Because it is 
virtually impossible to conduct an investigation while complying with 
these requirements, and because employers and investigators face 
unlimited liability, including punitive damages, for failing to comply 
with FCRA, the Vail letter effectively deters employers from using 
experienced and objective outside organizations to investigate 
workplace misconduct. Yet, in many cases, an employer must do so in 
order to comply with obligations under other laws. Thus, the Vail 
letter often places employers in the untenable position of having to 
choose between two legal obligations.


                           fcra requirements

  The pertinent FCRA requirements include:
  (1) Notice to the consumer (in this case, the employee) of the 
investigation;
  (2) The employee's consent prior to the investigation;
  (3) A description of the nature and scope of the proposed 
investigation, if the employee requests it;
  (4) A release of a full, un-redacted investigative report to the 
employee; and
  (5) Notice to the employee of his or her rights under FCRA prior to 
taking any adverse employment action.
  Any mistake in compliance with these or any of the FCRA's other 
numerous technical requirements may expose employers and investigators 
to unlimited liability for compensatory and punitive damages.
  However, Title VI of H.R. 2622, remedies this problem without 
tampering with FCRA's consumer credit protections. Title VI of H.R. 
2622 is an incorporation of a bill that I co-sponsored, along with 
Representatives Sessions, Baker, Paul, Moore, Shays, Frank, and Royce, 
H.R. 1543, to amend the FCRA to exempt certain communications from the 
definition of ``consumer report,'' and for other purposes.
  The Vail letter places many businesses in an extremely difficult 
position. While an employer may avoid running afoul of Vail by 
performing the investigation itself, there are many instances where a 
company has no choice but to use an outside investigator. For example, 
the technical nature of the alleged misconduct may require an expert 
investigator, such as where the misconduct involves securities fraud. 
In other instances, such as corporate governance cases, the 
investigation may involve misconduct by a high-level official and 
outside objectivity is necessary. In other cases, the employer may 
simply lack the resources to conduct an in-house investigation. Even 
where outside investigators are not necessary, they may be preferred. 
Indeed, both the courts and administrative agencies have strongly 
encouraged employers to use experienced outside organizations to 
investigate

[[Page 21744]]

suspected workplace violence, employment discrimination and harassment, 
securities violations. theft or other workplace misconduct. As 
Assistant Attorney General James K. Robinson said in his May 4, 2000 
Congressional Testimony, ``[t]he Department [of Justice] and other 
agencies often strongly encourage companies, as part of their 
compliance programs to retain outsider counsel to conduct certain 
internal investigations, on the theory that an outsider is less subject 
to retaliation or intimidation by supervisors or co-workers and is less 
likely to be biased by concerns for the company's business with 
existing or future customers.''
  While the letter impacts all businesses, it is particularly damaging 
to small and medium sized companies that do not have the in-house 
resources to conduct their own investigations. Even the FTC has 
recognized that ``there is considerable tension between [the FCRA 
requirements] and certain public policy aims of statutes and 
regulations that, directly or indirectly compel or encourage 
investigations of various forms of workplace misconduct . . . [and the 
situation is] particularly troubling for small employers.''
  Although the FTC recognizes the problem it, nonetheless, has refused 
to reverse its position and rescind the letter, claiming that a 
legislative fix is necessary. Title VI of H.R. 2622 is that legislative 
fix. It remedies the problems created by FTC's letter by excluding 
employment investigations that are not for the purpose of investigating 
the employee's credit worthiness from the FCRA requirements. The bill 
is essentially a narrow technical correction that does not tamper with 
FCRA protections for any investigations into credit-worthiness. In 
addition, the bill does not leave those suspected of misconduct without 
protection: it still requires that employers who take adverse action 
against an employee based on information from an investigation provide 
the employee with a summary of the nature and substance of any 
investigative report.


                         benefits of h.r. 2622

  This bill, along with an intact Title VI exclusion of workplace 
investigations, will preserve the continuity of our credit system and 
will include comprehensive identity theft, dispute resolution, and 
credit report accuracy provisions. Additionally, this legislation 
proposes to take the important step of providing all Americans with 
access to a free credit report every year in order to empower consumers 
to take control of their financial records.
  This legislation will prove crucial to the protection of consumers 
from the dangers of identity theft, the fastest growing white-collar 
crime in America. The following important steps toward protecting our 
consumers from identity theft are proposed within relevant provisions:
  Creating a duty for furnishers to investigate change of addresses, 
which can be indicators of identity theft;
  Creating a multi-level fraud alert system for victims of identity 
theft to protect their credit information;
  Requiring all credit and debit card receipts to be truncated to 
protect these valuable identifiers;
  Providing a summary of rights for all potential victims of identity 
theft;
  Allowing consumers to block all credit information resulting from 
identity theft;
  Establishing ``Red Flag'' procedures so that government regulators 
may help furnishers to eradicate identity theft before it occurs 
(preventative); and
  Requiring a study on how technology can help solve identity theft.
  In addition, this legislation will take steps to improve dispute 
resolution procedures and improve the accuracy of credit reports. The 
legislation proposes to take the following steps towards these goals:
  Require a reasonable reinvestigation of disputes and requires a 
prompt reinvestigation;
  Require CRA's and furnishers to reconcile differences in addresses on 
requests;
  Prevent repollution of data that is a result of identity theft; and
  Require credit reports to disclose contact information of furnishers 
to resolve disputes.
  This legislation will also provide consumers with more access than 
ever before to their credit information in order to empower these 
consumers with the information to protect themselves. The legislation 
proposes to create this access by:
  Providing free credit reports annually to all consumers; and
  Disclosing credit scores for a reasonable fee, as well as important 
factors that make the score.
  Finally, this legislation also contains important provisions to 
protect medical information that is present in financial services' 
systems and provide for confidentiality of medical data in all credit 
reports.
  Taken together, the above ``facts'' as to the FACT Act will protect 
the privacy rights of Americans; however, in crafting this bill, the 
Committee on Financial Services failed to put a limitation on the scope 
of the notice and disclosure requirements with respect to 
investigations into workplace misconduct. In 1999 and 2000, the Federal 
Trade Commission (FTC) issued several staff opinion letters which 
concluded that if an employer hires an experienced and objective 
outside organization to investigate suspected workplace misconduct, 
i.e., sexual or racial harassment, workplace violence, theft, fraud, 
SEC violations, or other improprieties, the investigation would qualify 
as a ``consumer report'' subject to the Fair Credit Reporting Act 
(FCRA). As such, employers and the investigators hired by them to 
handle alleged harassment cases would be subject to the cumbersome and 
over-reaching notice and disclosure requirements of FCRA.
  Mr. Chairman and Ranking Member, I therefore support this bill only 
insofar as it is accepted with the inclusion of Title VI in its 
entirety and as drafted.

                              {time}  1515

  Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentlewoman from 
New York (Mrs. Kelly), the chairwoman of the Subcommittee on Oversight 
and Investigations of the Committee on Financial Services.
  Mrs. KELLY. Mr. Chairman, I thank the gentleman for yielding me this 
time, and I want to applaud both the chairman and the ranking member of 
the Committee on Financial Services for acting on this important 
legislation with the kind of thoroughness and deliberation that they 
did take.
  The legislation before us, the FACT Act, is the result of half a 
dozen hearings, 75 witnesses, and months of deliberation by my 
colleagues from both sides of the aisle. The construction of the 
legislation is the permanent reauthorization of the Fair Credit 
Reporting Act, or the FCRA. It has provided a national uniform 
reporting system that has effectively lowered the cost of credit and 
increased choices and convenience for consumers across the country.
  In our hearings, we heard extensive testimony from many diverse 
witnesses with different interests. But there was a common message that 
the FCRA has lowered the cost of credit and helped fuel our economy. 
And this extension of low-cost credit has created new opportunities for 
populations who have never before had access to credit. That is why 
this legislation has overwhelming bipartisan support.
  The Fair Credit Reporting Act has also helped address other important 
security provisions, such as combating identity theft and the blocking 
of terrorist financing under the USA PATRIOT Act, both issues which I 
have held a number of hearings on in my oversight subcommittee. 
Combating identity theft and drying up terrorist financing requires the 
collaborative effort of law enforcement and regulatory agencies, 
consumers and financial institutions, all with access to appropriate 
information.
  FCRA improves our ability to combat identity theft and help law 
enforcement officials track down illicit money under the PATRIOT Act. 
The information sharing under this legislation is essential to 
protecting the American people by detecting suspicious activity and 
weeding out wrongdoers.
  The national reform standards under FCRA have also facilitated the 
financial institution's ability to utilize additional authentications 
and identity verifications to protect consumer security. And the 
increased protections incorporated in this legislation are critically 
important in enabling victims to correct the damage to their credit 
histories created by identity thefts. This legislation will further 
help law enforcement combat financial fraud and track down criminals 
and terrorists. It adds new protections that are important to achieving 
these goals.
  We have also made other important improvements to the FCRA in order 
to protect the sanctity of privacy of the American people throughout 
the credit-granting process. I believe that medical information of 
consumers should be kept private and does not need to be shared or 
distributed to others by creditors listed on credit reports. 
Individuals should know their personal medical information belongs to 
them

[[Page 21745]]

and is not released for other purposes, whether it is for the credit-
granting process or employee background checks. And we have done this 
with our legislation by coding this information.
  Mr. Chairman, I would like to thank the gentleman from North Carolina 
(Mr. Watt) and the gentleman from Arkansas (Mr. Ross) for working with 
me on an amendment in full committee that will protect the medical 
information of individuals without disrupting access to low-cost credit 
and the security of information. By allowing consumers to benefit from 
reporting the financial aspects of their transactions to credit bureaus 
while maintaining the sanctity of their medical privacy, this 
legislation is a real win for Americans.
  Mr. Chairman, I strongly support this legislation. It is crucial to 
the economy and the security of the American people. I thank the 
chairman for addressing these important issues, and I urge my 
colleagues to vote for this legislation.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield 3 minutes to the 
gentleman from Texas (Mr. Hinojosa), another diligent member of the 
committee who made a great contribution to this bill.
  Mr. HINOJOSA. Mr. Chairman, I am an original cosponsor of the Fair 
and Accurate Credit Transactions Act, and I support it strongly. H.R. 
2622, known as the FACT Act, provides for a strong national credit 
system. It preserves consumers access to affordable credit, enhances 
consumer protections, and will ensure that Hispanics will continue to 
have access to credit.
  From the beginning of this process, my new Democrat colleagues and I 
have been deeply involved in crafting this bipartisan bill, which 
passed the Committee on Financial Services by a 61 to 3 vote. The bill 
preserves the continuity of our credit system and includes 
comprehensive identity theft, dispute resolution, and credit report 
accuracy provisions that will increase and strengthen people's control 
over their own financial records.
  Identity theft is one of the fastest growing white collar crimes in 
the United States, especially in my State of Texas. This legislation, 
H.R. 2622, will help reduce those crimes and help the victims of 
identity theft regain their identity and restore their credit. The FACT 
Act addresses all these important issues and more. It will benefit 
consumers in our economy, and it will help improve financial literacy 
in the United States.
  I commend my Republican colleagues, especially the chairman, the 
gentleman from Ohio (Mr. Oxley), and the subcommittee chairman, the 
gentleman from Alabama (Mr. Bachus), for working with us in a 
bipartisan manner to develop this legislation. I also applaud the 
ranking member, the gentleman from Massachusetts (Mr. Frank), and 
another ranking member, the gentleman from Vermont (Mr. Sanders), for 
guiding us through this process.
  Finally, Mr. Chairman, I want to give special thanks to the 
gentlewoman from Oregon (Ms. Hooley), the gentleman from Kansas (Mr. 
Moore), and the other 10 new Democrats who worked so diligently to 
compromise and help us forge this bipartisan compromise. I strongly 
encourage my colleagues to support this important legislation, H.R. 
2622.
  Mr. OXLEY. Mr. Chairman, I am pleased to yield 5 minutes to the 
gentleman from Alabama (Mr. Bachus), the author of this important 
legislation and the chairman of the Subcommittee on Financial 
Institutions and Consumer Credit.
  Mr. BACHUS. Mr. Chairman, I thank the chairman of the committee, the 
gentleman from Ohio (Mr. Oxley), for yielding me this time and who was 
certainly instrumental in making this a priority and in allowing the 
committee to take as much time as it did to consider this issue, 
because it was an important issue.
  We have received a statement from the Executive Office of the 
President, which arrived here today, concerning this legislation; and I 
want to read from it. It says the administration strongly supports 
House passage of H.R. 2622. The bill includes many of the 
administration's proposed consumer protections, including new tools to 
help fight identity theft. The national credit reporting system has 
proven critical to the resilience of consumer spending and the overall 
economy.
  That is one thing we heard over and over, that the national credit 
reporting system was essential to maintain the overall economy and 
consumer spending. So I am pleased that Chairman Oxley has received 
this important endorsement from the President.
  It has been said that I was the author of this legislation, and, in 
fact, I would sort of like to claim that, but it is truly a bipartisan 
bill. We had a blueprint to start with, however, on our ID theft 
provision, and I would like to recognize at this time and thank the 
gentleman from Ohio (Mr. LaTourette) for all his work on identifying 
the theft provision that needed to be in this legislation.
  Actually, he introduced, with the gentlewoman from Oregon (Ms. 
Hooley), the original number of provisions which were taken and put in 
this bill verbatim. So we did not have to start from scratch. It was a 
big help that we had a bipartisan bill that the gentleman from Ohio and 
the gentlewoman from Oregon had worked on. What he brought to the table 
from the start was a piece of legislation that has since evolved over 
time, been updated, and I think improved with the help of consumers and 
the industries and the administration and Members of this Congress to 
serve as a valuable protection against identity theft, and I commend 
him on that.
  I want to run over some of those protections if time permits. Here 
are some of the important consumer protection tools. It allows 
consumers to place fraud alerts in their credit reports to prevent 
identity thieves from opening accounts in their names, including a 
special provision to protect active duty military personnel, who we 
found, sadly, had been particularly susceptible to ID theft. It allows 
consumers to block fraudulent information from being given to a credit 
bureau and from being reported by a credit bureau if that information 
results from identity theft. It provides ID theft victims with a 
summary of their rights. It gives consumers the right to see not only 
their credit reports but their credit scores.
  Now, that is an important new right which will help people. And I 
think there was unanimous agreement on this from industry, from 
consumers, and Members of Congress. This will actually help people save 
money with lower interest rates. One estimate I have read is $21 
billion in savings in home mortgages alone.
  It restricts access to consumer-sensitive health information. That is 
something people said: we do not want our health information to be 
shared without our permission. It empowers consumers by making it 
easier to limit unsolicited marketing offers. And it ensures improved 
accuracy of credit report procedures. It is very important that the 
information that is shared between creditors and credit bureaus is 
accurate. It provides consumers with a one-call-for-all protection by 
requiring credit bureaus to share consumer calls on ID theft, including 
reporting fraud alerts with other credit bureaus. One call does it all. 
Important suggestion.
  With that, Mr. Chairman, I would also like to commend Wayne 
Abernathy, Assistant Secretary of the Treasury, and Secretary of 
Treasury Snow. And once again, I wish to commend the chairman, the 
gentleman from Ohio (Mr. LaTourette), the gentleman from Massachusetts 
(Mr. Frank), and all of the 58 cosponsors of this original legislation.
  Mr. HINOJOSA. Mr. Chairman, I reserve the balance of my time.
  Mr. OXLEY. Mr. Chairman, I am pleased to yield 2 minutes to my good 
friend, the gentleman from the great Buckeye State of Ohio (Mr. 
LaTourette), a former prosecutor, and one of the real leaders in the 
identity theft provisions, along with the gentlewoman from Oregon (Ms. 
Hooley).
  Mr. LaTOURETTE. Mr. Chairman, I thank both the gentleman from Ohio 
(Mr. Oxley) and the gentleman from Alabama (Mr. Bachus) for their very 
kind words.
  Mr. Chairman, when I travel back to Ohio, I have to admit that folks 
up

[[Page 21746]]

there are not telling me how important it is that we reauthorize the 
Fair Credit Reporting Act. They are not telling me how this legislation 
helped them drive home the new minivan the same day they went to the 
dealership, or how the convenience of the national credit granting 
system allowed them to charge a trip with the kids to Disneyland on 
their MasterCard. What is ironic, Mr. Chairman, is that this lack of 
interest from the average American consumer demonstrates to me very 
clearly that the amendments the Congress passed in 1996 to create the 
national credit system that we all take for granted today is working 
exceptionally well and it is a perfect illustration of why we need to 
support this legislation.
  The bill before us today not only makes that system of the national 
standard for our country, but it also, as has been mentioned, tackles 
the problem of identity theft. During the committee's extensive hearing 
process on this legislation, we heard from a number of experts on the 
issue. We also heard from a number of victims. One of them came from my 
hometown, a woman by the name of Maureen Mitchell. And it was the 
severity of Maureen's case that inspired me to work with my friend, the 
gentlewoman from Oregon (Ms. Hooley), who has really been dogged in the 
pursuit of this part of the legislation for years, and my hat's off to 
the gentlewoman from Oregon.
  It was the severity of that case, and, basically, she and her husband 
had their identities stolen, and they racked up $100,000 in bills. In 
Chicago, the thieves went and got $45,000 in loans in the span of 2 
hours, and they were horrified to learn that they were the ``proud 
owners'' of two sport utility vehicles that they, of course, did not 
purchase.
  Anytime the Congress debates the issue of preempting State law, we 
have to question whether or not the Federal Government knows better 
than the States on how to pass a law that affects our citizens. When 
the question relates to access to credit and identity theft, I strongly 
believe the answer is in this legislation. Creating a set of uniform 
national standards will benefit people across the economic spectrum and 
is the perfect vehicle to fight the crime of identity theft.
  I would urge my colleagues on both sides of the aisle to think of all 
the times we take for granted the ability to gain fast access to credit 
in our day-to-day activities. As a parent, it was terrifying when my 
daughter got her first credit card in the mail. But when that envelope 
arrived and she proudly stuck that piece of plastic in her wallet, she 
began building a credit history that will one day allow her to buy a 
home or take that vacation to Disneyland.

                              {time}  1530

  Mr. Chairman, I would like to thank very much the gentleman from Ohio 
(Chairman Oxley), the gentleman from Massachusetts (Mr. Frank), and the 
gentleman from Alabama (Chairman Bachus) for this nice piece of 
legislation.
  Mr. Chairman, when I travel back home to Madison, Ohio, I'll admit 
it--the folks up there aren't telling me how important reauthorizing 
the Fair Credit Reporting Act is to them. They're not telling me how 
this legislation helped them drive a new minivan home the same day they 
went to the dealership, or how the convenience of our national credit 
granting system allowed them to charge a trip with the kids to 
Disneyland on their Matercard. What's ironic, Mr. Chairman, is that 
this lack of interest from average American consumers demonstrates to 
me very clearly that the amendments Congress passed in 1996 to create 
the national credit system that we all take for granted today is 
working exceptionally well, and is a perfect illustration of why we 
need to support this legislation.
  The bill before us today not only makes that system the national 
standard for our country, but also tackles the issue of identity theft. 
During the Committee's extensive hearing process on this legislation, 
we heard from a number of experts on this issue, and we also heard the 
testimony of a number of victims, one of whom--Maureen Mitchell--is 
from my hometown. The severity of Maureen's case is what inspired me in 
the 106th Congress to work with my friend Congresswoman Darleen Hooley 
to draft what have now become the critical ID theft provisions in the 
bill before us today. To give you some idea of the enormity and extent 
of the Mitchell family's identity theft saga, all told, Maureen and her 
husband Ray have been victimized to the tune of well over $100,000. 
Their identities have been used to apply in a two-hour period for 
$45,000 worth of personal loans at three different banks in Chicago. 
And they are the ``owners'' of two luxury Sport Utility Vehicles that 
they never purchased.
  Any time Congress debates the issue of pre-empting State law, we have 
to question whether or not the Federal Government knows better than the 
States how to pass a law that affects our citizens. When the question 
relates to access to credit and identity theft, I strongly believe that 
the answer is in this legislation: creating a set of uniform national 
standards will benefit people across the economic spectrum, and is the 
perfect vehicle to fight the crime of identity theft.
  That said, it would be wrong of us to tie consumers and industry down 
with very specific operating guidelines and regulations. It would be 
foolish to believe that there is one cure-all that will completely 
prevent cases of identity theft, but with the options and flexibility 
provided by this legislation, consumers, creditors, and law enforcement 
will be able to stay ahead of the identity thieves as they find new 
technologies and methods of carrying out this crime.
  Again, I urge my colleagues on both sides of the aisle to consider 
all the times we take for granted the ability to get fast access to 
credit in our day-to-day activities. As a parent, yes, it was a 
terrifying thing when my oldest daughter got her first credit card. But 
when that envelope arrived in the mail and she proudly stuck that piece 
of plastic in her wallet, she began building a credit history that will 
one day allow her to buy a home and take that vacation to Disneyland 
with her family. With the Fair Credit Reporting Act set to expire at 
the end of the year, this Congress is in a unique position to have a 
tremendous impact on every American consumer. If we do not act today 
and support this legislation, we will be denying future generations of 
Americans the same financial luxuries we have all enjoyed for the last 
eight years.
  Finally, I would like to thank Chairman Oxley and Subcommittee 
Chairman Bachus for their strong leadership on this legislation.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as 
I may consume to engage in a colloquy with the chairmen of the full 
committee and the subcommittee.
  Mr. Chairman, as part of this colloquy, I would say to my friends the 
chairmen of the full committee and subcommittee that many Members are 
concerned about the scope of the preemption that was just referred to, 
particularly with regards to identity theft.
  So I want to clarify with the author of the bill, the committee 
chairman, what we are intending and how we have underscored that 
intention in the manager's amendment which will be coming forward.
  Does this bill or this amendment allow the preemption of any State 
law on identity theft, such as limits on Social Security number use, 
criminal penalties for identity theft perpetrators, or other identity 
theft protections that are not specific subject matters addressed by 
this bill.
  Mr. OXLEY. Mr. Chairman, will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from Ohio.
  Mr. OXLEY. Mr. Chairman, the answer is no. The Member from 
Massachusetts is correct. The identity theft protections in this bill 
amend section 605 of the Fair Credit Reporting Act. The uniform 
standard for section 605 is contained in section 624(b)(1)(e) which 
states that, ``No requirement or prohibition may be imposed under the 
laws of any State with respect to any subject matter regulated under 
section 605.''
  The section goes on to describe section 605 saying that it relates to 
information contained in consumer reports, and now to identity theft 
prevention. That means that 605 is the section for identity theft 
protections, but the uniform standard requirement is still limited to 
the subject matters that our provisions actually address such as 
investigating address changes, fraud alerts, truncating credit card 
account numbers, blocking bad credit information, establishing red flag 
guidelines for identity theft prevention, and reconciling address 
changes.

[[Page 21747]]

  State identity theft laws that address different issues such as 
limiting Social Security number use or criminal penalties on identity 
theft perpetrators are not preempted. We have agreed with the gentleman 
from Massachusetts (Mr. Frank) to clarify this in the manager's 
amendment to underscore in the uniform standards provision that 
describes section 605 that it only relates to the specific identity 
theft prevention subjects covered and not to other identity theft 
issues outside of the subject matters covered in the uniform standard.
  Mr. BACHUS. Mr. Chairman, will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from Alabama.
  Mr. BACHUS. Mr. Chairman, I would like to affirm the understanding 
between the gentleman from Ohio (Mr. Oxley) and the gentleman from 
Massachusetts (Mr. Frank).
  In this bill we built upon the amendments that the gentleman from 
Ohio (Mr. LaTourette) and the gentlewoman from Oregon (Ms. Hooley) had 
first offered along with the gentleman from New York (Mr. Ackerman) and 
also the gentleman from Massachusetts (Mr. Frank) to flesh out existing 
uniform standards.
  The bill of the gentleman from Ohio (Mr. LaTourette) and the 
gentlewoman from Oregon (Ms. Hooley) that we used as our base text 
expanded on the uniform standards for identity theft. But in that bill, 
as in ours, there is no intent to go beyond the specific subjects 
identified in the bill.
  So, for example, we do create uniform standards for opening new 
credit accounts when there are allegations of potential identity theft 
under our fraud alert and blocking provisions. Because you need a 
consistent rule that consumers and businesses can rely on when there 
has been a fraud alert, when there has been an allegation of identity 
theft. We do not address other subject matters that are not covered 
such as limits on Social Security number use or criminal penalties for 
identifying theft perpetrators.
  These are issues that we expect the States to continue to work out 
solutions to. Hopefully we can return to work on those ourselves with 
Members like the gentleman from Florida (Mr. Shaw) or the gentleman 
from Arizona (Mr. Shadegg), the gentleman from California (Mr. Ose), 
the gentleman from Illinois (Mr. Emanuel). And I think the gentlewoman 
from Oregon (Ms. Hooley) also wants to address some of those issues. 
Many of them will have to be addressed either in the Committee on Ways 
and Means or in the Committee on the Judiciary. And they have valid 
concerns, but it is just from a jurisdictional standpoint.
  Mr. FRANK of Massachusetts. Reclaiming my time, I thank the gentleman 
from Alabama (Mr. Bachus). Let me say I appreciate the affirmations 
from both gentlemen.
  Mr. Chairman, let me say now, I want to transition from the colloquy 
where we were in agreement as to what it says to express my view that I 
think even with these agreements the bill is, with regard to some 
existing law in California and elsewhere, more preemptive than it needs 
to be.
  I recognize the value of this colloquy in making clear what those 
limits are. The gentlewoman from California (Ms. Waters) who has been 
very concerned about this and who, indeed, alerted me to it earlier, 
and I unfortunately did not pay as much attention as I should have at 
the time, she is concerned and I share her concerns, so she will be 
pursuing this further.
  So I just want to say while I am pleased to have this colloquy and to 
have these understandings, my own personal view, which I realize is not 
shared by the gentleman of Ohio (Mr. Oxley) and the gentleman from 
Alabama (Mr. Bachus) is that even with these understandings, there is 
more preemptive language here than need be. I intend to work with the 
gentleman from California and other Californians in various ways to try 
and further reduce that preemption.
  Mr. BACHUS. Mr. Chairman, will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from Alabama.
  Mr. BACHUS. Mr. Chairman, just to make a clarification, it has been 
said that this bill will preempt the new California legislation.
  Mr. FRANK of Massachusetts. Mr. Chairman, let me take back my time. 
There were two different California issues here. Of course, one would 
not expect California to settle for only one controversy. The gentleman 
from Alabama (Mr. Bachus) is correctly alluding to the future issue of 
so-called SB1. But what the gentleman from California had identified to 
me before that had passed was preemption of existing California where 
it predates the recent enactment. And that is the concern that I was 
alluding to.
  Mr. BACHUS. Mr. Chairman, will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from Alabama.
  Mr. BACHUS. Mr. Chairman, as we have said, we need a national 
standard just like we need a national interstate highway system or 
other national uniform standards. California saw fit, when they passed 
this law, to exempt local statutes.
  Mr. FRANK. Mr. Chairman, I will have to take back my time. I have one 
more speaker. The gentleman is again talking about the language going 
forward in SB1. The gentlewoman from Los Angeles and I are now 
addressing a different set of laws, laws that had already been on the 
books prior to that, laws passed subsequent to 1996, some of which I 
think are unnecessarily preempted, although this colloquy has helped.
  Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
Pennsylvania (Ms. Hart), a valuable member of our committee from the 
Keystone State.
  Ms. HART. Mr. Chairman, I rise in support of the FACT Act, the Fair 
and Accurate Credit Transactions Act. Fortunately, today we appear to 
have bipartisan support of the Act, and it is for a clear reason, our 
credit system in the United States is the envy of the world. Our 
uniform national standards have helped to make the United States a 
world leader, and have continued to spur on our economy, even in times 
that have been difficult in the last year or so.
  The bill makes these national standards that have been in effect 
permanent. This is important to ensure continuity in our credit system, 
and also to maintain continued access to the best credit markets in the 
world. This is especially important because two-thirds of our economy 
depends very heavily on consumer spending. Consumers will not spend 
without access to credit, and to get access to credit, consumers and 
lenders need consistent, uniform standards for credit reports. Broader 
access is the result. National and worldwide access is also the result.
  According to the Federal Reserve Board, in fact, since the Fair 
Credit Reporting Act was enacted, the overall percentage of families 
with general purpose credit cards increased from 16 to 73 percent and 
the largest increase was among lower-income families.
  Homeownership levels have also grown approximately 10 percent, again 
with low income and minority families receiving the largest gains.
  According to some estimates, these improvements have saved consumers 
nearly $100 billion annually. Many of my colleagues have mentioned the 
benefits also regarding fighting identity theft. This bill allows each 
consumer to get a copy of their credit report annually, and that will 
help to avoid a lot of the problems we have been having with ID theft 
and use of credit by those not authorized. It helps the consumer to 
identify charges that are not theirs, it helps to identify and clear 
them from the credit report keeping the consumers' credit clear.
  Every year a consumer would have access to a free copy of that credit 
report, see their credit scores which help them understand whether they 
are going to be able to get access to a mortgage or new credit.
  Finally, I ask my colleagues to support this Act because it will 
create continuity, it will continue the dynamic American system, and it 
will help us keep access to safe credit and flexibility for the 
American consumer.

[[Page 21748]]


  Mr. FRANK of Massachusetts. Mr. Chairman, I yield 3 minutes to the 
gentleman from Vermont (Mr. Sanders), the ranking member of the 
subcommittee who worked very hard to make the bill better, but still 
obviously has some concerns with it. But from the consumer standpoint, 
the gentleman worked as hard as anyone.
  Mr. SANDERS. Mr. Chairman, I thank the gentleman for yielding me this 
time.
  Unfortunately, I rise in opposition to this legislation. While this 
bill does include important consumer protection provisions, such as the 
provision that I and other members of the committee fought for, which 
would provide free annual credit reports to consumers who request them, 
and would also allow consumers to receive more information about their 
credit scores identical to a very good law in the State of California, 
there are major flaws in this legislation.
  For a start, even in terms of that pro-consumer provision, we are not 
quite sure when that will go into effect, and I fear it will not go 
into effect as soon as it should.
  Secondly, I think the major concern that I and consumer organizations 
all across this country have is that this legislation would permanently 
preempt the States from passing stronger consumer protection laws in 
order to aggressively punish identity thieves and to improve the 
accuracy of consumers' credit reports.
  I may be the conservative on the committee, but it has long been my 
belief when we are dealing with an issue of protecting consumer rights, 
we cannot take away the ability of the States to pass stronger consumer 
protection laws. I find it very ironic from day one of this discussion 
that conservatives who have told us over and over again how much they 
dislike the big bad Federal Government stepping on States' rights, in 
fact have brought that provision into this legislation.
  So if the State of Vermont or the State of California or the State of 
Ohio wants to go further in this area, well, my goodness, that big bad 
Federal Government, which we have heard so much about, is able to say 
sorry, you cannot do it. Attorneys general, governors, State 
legislators, you cannot do that, and I think that is wrong.
  During the course of the debate on the committee, there was a very 
interesting discussion over an amendment that I and the gentleman from 
Alabama (Mr. Bachus) brought forth which deals with the issue of what I 
call credit card switch and bait, and I will be bringing forth an 
amendment to win support of it. It is not included in this bill, and it 
should be.
  Mr. Chairman, what is going on in this country is that people who pay 
off their credit card debts on time every single month nonetheless are 
seeing huge increases in the interest rates that they are paying. How 
does that happen? It happens because maybe 3 years ago they took out a 
loan which is still outstanding, or maybe they had an emergency medical 
bill and they had to borrow money, and arbitrarily the credit card 
company has determined they are a greater financial risk and their 
rates can double or triple. I think that is wrong.
  This bill has some positive provisions, but we can do much better, 
and I would urge a ``no'' vote on it.

                              {time}  1545

  Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Arizona (Mr. Shadegg).
  Mr. SHADEGG. Mr. Chairman, I thank the gentleman for yielding me this 
time. I rise in strong support of this carefully balanced legislation. 
I want to compliment the authors and the committee chairman for doing 
what I think is a superb bill that will in fact help consumers across 
America. Indeed, I think this is a key component in protecting our 
credit structure and enabling Americans to get the credit that they 
need. I am very pleased that the legislation does what it does.
  Importantly, as the author of our Nation's first identity theft 
legislation, I am very pleased with the provisions in this bill that 
deal with identity theft. It makes some important strides in improving 
our fight against identity theft. For example, the bill requires that 
anytime a transaction is made and information is transmitted using a 
credit card number, that number has to be truncated so that someone who 
wants to steal your identity by grabbing ahold of your credit card 
number will not have the full number. While some companies currently do 
that, not all do. This will protect them very much.
  There are a number of other key provisions dealing with the issue of 
identity theft, and that is a critical issue because, for example, it 
was just reported last week that in America last year, 10 million 
people became the victims of identity theft. Those individuals 
themselves, as individuals, suffered $5 billion in damages. But on top 
of that, businesses in America sustained $47 billion of losses as a 
result of identity theft. And so the ID theft provisions in this bill I 
think are very, very important. But it could go further.
  The General Accounting Office testified in July of this year that 
Social Security numbers are often the identifier of choice among 
individuals seeking false identities; and perhaps to the shock and 
amazement of people in this room and across the country, just last 
month, an organization engaged in consumer advocacy, to prove that 
Social Security numbers are too available, purchased the Social 
Security number of Attorney General John Ashcroft and CIA Director 
George Tenet off the Internet for a mere $26. The problem is that 
Social Security numbers are too available.
  In 2002, the FBI testified that possession of someone else's Social 
Security number is key to laying the groundwork to take over that 
individual's identity and obtain a driver's license, loans, credit 
cards, and merchandise. It is also key to taking over an individual's 
existing account and wiring money from the account, charging expenses 
to an existing credit line, writing checks on the account or simply 
withdrawing money.
  It is absolutely critical that this Congress this year enact 
legislation to prohibit the purchase and sale of Social Security 
numbers in a fashion that allows identity thieves to get ahold of those 
numbers. This legislation does not yet do that. Hopefully, either in an 
amendment yet offered this afternoon or in the conference committee, we 
can do that. There is bipartisan support for this idea. I know the 
gentleman from Illinois (Mr. Emanuel) on the other side supports doing 
it as well as a number of others. I have been helped by many, including 
the gentleman from Massachusetts. We can deal with this problem, but we 
must do so in legislation that will pass this year. Anyone who blocks 
that legislation or seeks to keep it from happening and happening very, 
very quickly, I think, is doing a disservice to the victims of identity 
theft across this country.
  It is important to note that the second greatest concern of Americans 
when it comes to privacy is that their identity might be stolen by an 
identity thief and that they might be victimized by that and undergo 
that pain. Again, I would reiterate that this is very important 
legislation. It goes a long way toward stopping identity theft. It can 
go a little further if we prohibit the purchase and sale of Social 
Security numbers.
  I urge my colleagues to vote for the legislation.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield 2 minutes to the 
gentleman from New York (Mr. Crowley), one of those who had a major 
input into this bill.
  Mr. CROWLEY. Mr. Chairman, first I want to take this opportunity to 
thank the gentleman from Ohio (Mr. Oxley) and the gentleman from 
Massachusetts (Mr. Frank), as well as the gentleman from Alabama (Mr. 
Bachus) and the gentleman from Vermont (Mr. Sanders), for their work 
together in what I believe is truly a bipartisan effort and manner to 
craft, in my opinion, a well-balanced bill, understanding that there is 
a deadline looming in the not-too-distant future as pertains to many of 
these issues.
  This bill ensures the continued flow of credit for American consumers 
by

[[Page 21749]]

allowing for the permanent protection of credit availability. Our 
economy and our credit-granting industry should not have to continually 
look over its shoulder at potentially burdensome regulations, 
regulations that could hinder the availability of credit for millions 
of Americans. But this legislation is not just about protecting 
consumer credit options. It is about protecting consumers' identity and 
their health information. This bill strengthens the rules to protect 
consumers from identity theft.
  The Committee on Financial Services, which I am a member of, heard 
from a woman who originally lived in my district, someone who I grew up 
just seven doors away from. Her name was Maureen Sullivan. Now it is 
Maureen Mitchell. She grew up in Woodside, Queens, New York, who was a 
victim herself, and her husband, of identity theft. It cost her not 
only money but it cost her an enormous amount of time, not to mention 
mental anguish. This quite frankly happens all too often in this 
country. This bill addresses many of these issues and works for 
increased protections for honest Americans and honest people. Most 
importantly, this bill ensures the strict prohibition of medical and 
health information from being used in the credit-granting or denial 
process. No longer can the information used in hospitals and in 
doctors' offices be used to decide one's creditworthiness.
  I want to urge my colleagues to vote in favor of this legislation. 
Once again I want to thank the chairman and the ranking member for all 
their good and honest work on what I think is a worthy piece of 
legislation.
  Mr. OXLEY. Mr. Chairman, I yield 1 minute to the gentleman from 
Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Chairman, let me say this. The body just heard from 
the gentleman from Arizona. He actually introduced in the 104th 
Congress the very first legislation dealing with identity theft. It was 
the Identity Theft and Deterrence Act, which had criminal penalties in 
it. Before most Americans, even most Members of Congress, knew of this 
problem, he knew about it.
  We do have a continuing concern about Social Security numbers. If we 
are going to truncate them, this is a great example of why we need a 
uniform standard. We cannot have one State truncating them into six 
numbers, another State into five numbers where we could not interchange 
them. I would encourage the gentleman from Arizona to continue to work 
with the Committee on Ways and Means in dealing with this problem, 
because it is something that we need to address in identity theft. I 
applaud and commend him for his effort and encourage him to continue 
with it.
  The CHAIRMAN. Without objection, the gentleman from North Carolina 
(Mr. Watt) will control the time of the gentleman from Massachusetts 
(Mr. Frank).
  There was no objection.
  Mr. WATT. Mr. Chairman, I yield 2 minutes to the gentleman from 
Kansas (Mr. Moore), a valued member of the committee who was chairman 
of the Democratic task force on this bill.
  Mr. MOORE. Mr. Chairman, I thank the gentleman from North Carolina 
for yielding me this time. I also want to thank the gentleman from Ohio 
(Mr. Oxley), the gentleman from Massachusetts (Mr. Frank), also the 
gentleman from Vermont (Mr. Sanders), and the gentleman from Alabama 
(Mr. Bachus) for the great work that they did on this bill. I rise in 
strong support of this bill which passed out of committee 61 to 3. That 
is almost unheard of in this body where there is so much conten-
tiousness, it seems, way too often. I think people out in the country 
wonder what is going on here. I think this is a splendid example of our 
ability to work together for something to benefit the American people 
and for business in this country.
  I ask my colleagues to vote in support of the bill that is going to 
come up on the floor today because it does assure the availability of 
reasonably priced consumer credit to consumers, which is going to 
enhance their ability to purchase things that they want in the future 
as well as to protect our economy and business in this country.
  I think it is very, very important that we pass this legislation 
intact. It increases consumer awareness of their rights. It protects 
against identity theft. It expands consumer access to credit 
information and gives a free credit report annually to consumers in 
this country. There are a number of consumer protections that the 
gentleman from Vermont and others worked for that are now built into 
this bill and if this bill is adopted will become in fact permanent.
  I urge my colleagues and all the Members of this body to vote in 
support of this bill.
  Mr. WATT. Mr. Chairman, I yield 2 minutes to the gentleman from 
Illinois (Mr. Emanuel) who has had such a tremendous impact on this 
bill, particularly the medical privacy portions of the bill. He has 
been a stalwart.
  Mr. EMANUEL. Mr. Chairman, I would like to thank my colleague from 
North Carolina for his kind words. I would like to also congratulate 
the gentleman from Ohio (Mr. Oxley), the gentleman from Massachusetts 
(Mr. Frank), the gentleman from Alabama (Mr. Bachus), the gentleman 
from Vermont (Mr. Sanders), and the gentleman from California (Mr. Ose) 
for cosponsoring our amendment that deals with medical information and 
blacking out that information. This is a landmark bill that will help 
American consumers by giving them important new rights and protections.
  Our economy benefits from a national credit reporting system like no 
other in the world, and this legislation strikes the right balance by 
safeguarding consumers while also ensuring continued access to our 
instant credit system. Medical information should have no place in 
employment decisions or credit determinations, and corporate affiliates 
should not be able to share it. This information deserves the strongest 
protection under the law, but beyond that it is important that we give 
consumers back some control over who can and cannot use this 
information. In fact, a recent Gallup poll showed 95 percent of 
consumers are worried that their health providers or insurers may be 
sharing their private medical information with others. Beyond this 
concern, however, they fear losing more control every day over 
sensitive medical information.
  No longer will we ask whether you opt in or opt out. Your medical 
information, medical information in your family from here forward is 
blacked out. It protects you in the most sensitive area. It blacks out 
the use of medical information in the credit-granting process. It 
establishes strict limits on the use of medical information for 
employment purposes. It blacks out the indiscriminate sharing of 
medical information among corporate affiliates. It blacks out the use 
of medical information to create individualized or aggregate lists 
based on consumers' payment transactions for medical products; creates 
a new and higher standard for reporting by credit reporting agencies to 
others who have requested information; and establishes strict limits on 
the reuse of medical information.
  This is both good for consumers and good for business. In a typical 
way when you have a win-win situation, it will also in my view garner 
great bipartisan support. Again I want to close by thanking the 
chairman and the ranking member for having a bill that brings together 
business interests and consumer interests not only throughout the bill 
but also in this particular area, by blacking out medical information 
and giving consumers again control over their own lives.
  Mr. WATT. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, in 1996, or when the original fair credit reporting 
bill was passed, which I do think was 1996, there was quite a bit of 
controversy about whether the Federal Government should be the 
controlling entity with respect to these kinds of credit issues. You 
had your classic States rights versus Federal Government debate. That 
has been much less of a debate this time because over time we have come 
to realize that commerce, both intrastate and interstate, is 
substantially impacted by the availability of credit. Just about 
everybody is using

[[Page 21750]]

credit in commerce. Nobody is paying cash anymore, or seldom are people 
paying cash. So the argument about whether the Federal Government has a 
legitimate role in this fair credit process kind of has gone by the 
board over the years and was less of an issue in this debate and gave 
the committee in my estimation the opportunity to focus on really 
creating a comprehensive kind of approach to dealing with credit in 
this country, dealing with some of the problems that people face when 
credit reporting agencies get the wrong information, dealing with 
identity theft and medical privacy, and the whole range of issues that 
can come into play when a credit transaction is about to take place.

                              {time}  1600

  I think the gentleman from Ohio (Chairman Oxley) and the gentleman 
from Massachusetts (Mr. Frank) have done just a magnificent job of 
hearing all of the input from all of the different sides and coming 
together on a bill that came out of committee with not unanimous 
support, but virtually unanimous support.
  Now, there are some things that may be tweaked between the committee 
process and the floor, and there might be some need to change one or 
two things that have been agreed upon, but there are some amendments 
that I think could have a negative effect on this kind of bipartisan 
agreement that has characterized this bill.
  So I hope that as we go forward into the amendment process, all of us 
will remember how hard we worked to keep this a bipartisan bill, to 
deliver a bill to the Senate that had just broad-based support so they 
would not sit there and not do anything and let the authorization run 
out. We need to maintain this bill in its current form as much as 
possible, unless the Chair and ranking member have agreed to 
amendments. I hope that my colleagues will keep that in mind.
  Mr. Chairman, it is time for us to pass this bill, move it over to 
the Senate, and hope that they will produce a product that will keep 
credit available to people in this country on a set of fair and 
equitable rules.
  Mr. Chairman, I yield the balance of my time to the gentleman from 
Massachusetts (Mr. Frank).
  Mr. FRANK of Massachusetts. Mr. Chairman, I want to thank the 
gentleman from North Carolina for taking over for me temporarily and 
for his very effective leadership throughout the deliberations on this 
bill.
  The CHAIRMAN. The time of the gentleman from Massachusetts has 
expired.
  Mr. OXLEY. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, in only 1 minute it will be difficult to thank 
everybody, but let me try. First, the chairman of the subcommittee, the 
gentleman from Alabama (Mr. Bachus), who has shown enormous leadership, 
the main sponsor of this bill. He held over eight hearings with over 
100 witnesses. The gentleman from North Carolina is right, everybody 
who wanted to be heard on this bill was heard, sometimes more than 
once.
  I would like to express thanks to the gentleman from Massachusetts 
(Mr. Frank) for his leadership and direction and for helping us all 
along the way; to the gentlewoman from Oregon (Ms. Hooley), and to the 
gentleman from Ohio (Mr. LaTourette), particularly on their efforts on 
identity theft; and to the gentlewoman from Illinois (Mrs. Biggert) for 
her contributions as well. It is a real honor roll of members on our 
committee.
  Frankly, over the last 2\1/2\ years, our committee has established a 
pretty solid record of bipartisan cooperation and production, whether 
it was the Sarbanes-Oxley bill, or whether it was tourism risk 
insurance, and the list goes on. This, I think, is one more addition to 
that honor roll. For that I am extremely grateful to the members of the 
committee on both sides of the aisle. We have been clearly blessed with 
a cooperation, and I think it will be reflected in the final vote.
  Mr. HOYER. Mr. Chairman, I urge all my colleagues to support this 
legislation--the Fair and Accurate Credit Transactions of 2003--which 
provides a national uniform standard on how consumer reporting agencies 
and other financial services entities may access and use consumer 
financial and medical data.
  But before I discuss the substance of the underlying bill, I want to 
compliment the Chairman and Ranking Member of the Financial Services 
Committee (Mr. Oxley and Mr. Frank), who worked together in crafting 
this bipartisan legislation, which I believe will be passed by an 
overwhelming margin today.
  This, Mr. Chairman, is how our legislative process should work. The 
Chairman and Ranking Member identified a need. They held hearings. And 
they crafted the bipartisan solution on the Floor today that is, 
nonetheless, open to amendment.
  Mr. Chairman, the advent of the Internet and the Information 
Revolution has been a terrific boon for the American consumer. Millions 
have received quick credit decisions on financing a new car, on 
obtaining a credit card, and on taking out or refinancing a mortgage. 
This has clearly facilitated many of the most important financial 
decisions consumer make, and strengthened our economy.
  However, it also illustrates the need for national uniform standards 
for financial information. And that is what this bill addresses.
  Under this legislation, consumers can receive a free annual credit 
report that will disclose their credit score. In addition, the Act 
gives consumers new options for disputing and correcting inaccuracies 
in their credit reports, encourages prompt investigations of such 
disputes, and establishes new requirements to prevent corrected errors 
from being reintroduced into a credit report.
  The Act also includes provisions to combat identify theft. A recent 
Federal Trade Commission survey indicated that more than 27 million 
Americans have been victims of identity theft in the last five years, 
including nearly 10 million people in the last year alone.
  H.R. 2622 permits consumers to more easily place ``fraud alerts'' on 
their consumer reports; to require credit reporting agencies to block 
(or omit) information that is confirmed to have resulted from an 
identity theft, as long as the consumer has filed a police report 
concerning the ID theft; and to prohibit retailers from printing the 
expiration date and more than the last five digits of a consumer's 
credit or debit card number on electronic receipts.
  Finally, the Act greatly expands the protections in the Fair Credit 
Reporting Act that govern the sharing and use of sensitive medical 
records and information, as well as information pertaining to medical-
related payments and debts. These provisions will prohibit consumer 
reporting agencies from including medical information in a consumer's 
credit report unless the medical information is directly relevant to 
the consumer's attempts to obtain employment or credit and the consumer 
has explicitly consented to the release of the information.
  Mr. Chairman, this legislation is not only substantively important, 
it is timely. As my colleagues may know, Congress must reauthorize the 
Fair Credit Reporting Act before the preemptions expire on December 31, 
2003.
  I urge my colleagues to vote for this legislation.
  Mr. GILLMOR. Mr. Chairman, I rise today in strong support of H.R. 
2622, the Fair and Accurate Credit Transactions Act of 2003. Passage of 
this important legislation is essential to maintaining our current 
national credit reporting system. As Federal Reserve Board Chairman 
Alan Greenspan make clear to the Financial Services Committee in his 
testimony, if we do not act to extend the uniform national standard for 
consumer protections governing credit transactions first established in 
the Fair Credit Reporting Act ``we will have great difficulty in 
maintaining the level of consumer credit currently available.''
  H.R. 2622 maintains the free flow of credit reporting information to 
lenders and other financial services providers while also creating 
powerful new consumer protections. Consumers will have the authority to 
place fraud alerts in their credit reports, preventing identity thieves 
from using their information and keeping negative information resulting 
from fraudulent activity from being reported to a credit bureau.
  The Fair and Accurate Credit Transactions Act will also allow 
consumers to access annually a free copy of their credit score and 
credit report identifying the key factors affecting their credit 
worthiness with recommendations on ways to improve their score. A 
provision I authored in H.R. 2622 will also improve the transparency of 
credit scoring systems by mandating that if the number of credit 
enquiries on a consumer's account negatively affects their score it 
must be disclosed in their consumer report. This ensures the consumer 
and their prospective lenders are fully informed. This important 
requirement will allow conscientious consumers to shop around for the 
best rates on loans or mortgages without unknowingly harming their 
credit.

[[Page 21751]]

  I would like to thank Financial Services Committee Chairman Oxley and 
Subcommittee Chairman Bachus for their hard work on this issue and urge 
my colleagues to join me in voting for this vital legislation. The 
consumer benefits afforded by our national credit system are too 
important to our nation's economy to be left at risk.
  Mr. ACKERMAN. Mr. Chairman, I rise today in support of H.R. 2622, the 
Fair and Accurate Credit Transactions Act. Over the past several 
months, the Financial Services Committee has held numerous hearings, in 
addition to the subcommittee and full committee markup of this 
legislation. As a member of the committee, I am proud to have played a 
role in crafting this important legislation which achieves a number of 
goals important to consumers, as well as to the financial industry.
  This legislation extends the expiring provisions of the Fair Credit 
Reporting Act, allows consumers to receive free annual credit reports, 
and protects consumers' sensitive medical information.
  I am particularly pleased with the provisions that help consumers 
prevent and correct inadequacies in their credit reports. The bill 
provides that when a financial institution reports negative 
information, such as a consumer's delinquencies, the institution must 
notify the consumer of this in writing. This is a win-win for all 
parties involved. Financial institutions will stand a greater chance of 
collecting their money sooner if the consumer is warned that being 
reported to the credit bureau is imminent. A notice in writing stating 
you will be reported to the credit bureaus for this delinquency and 
that this will affect your credit rating is strong motivation for most 
consumers. For the consumer who wants to protect and improve his credit 
rating, this is essential information. For the consumer whose identity 
has been stolen, this may be a vital notification.
  I have greatly appreciated the opportunity to collaborate with 
Chairman Oxley, Ranking Member Frank and their excellent staffs, all my 
colleagues on the Financial Services Committee, and representative of 
both the financial services industry and consumer groups to develop 
this historic bipartisan legislation. I ask my colleagues to join with 
me in supporting H.R. 2622.
  Mr. BEREUTER. Mr. Chairman, this Member rises today to express his 
support for H.R. 2622, the Fair and Accurate Credit Transactions Act of 
2003 (FACT Act). This important legislation permanently extends those 
provisions in the Fair Credit Reporting Act (FCRA) which relate to the 
preemption of State laws. These provisions in the FCRA are set to 
expire on December 31, 2003. The FCRA is the Federal law which governs 
the furnishing of reports on the credit worthiness of consumers.
  This Member would like to thank the distinguished gentleman from 
Alabama (Mr. Bachus), the Chairman of the House Financial Services 
Subcommittee on Financial Institutions and Consumer Credit, for 
introducing this important legislation. Furthermore, this Member would 
like to thank both the distinguished gentleman from Ohio (Mr. Oxley), 
the Chairman of the House Financial Services Committee, and the 
distinguished gentleman from Massachusetts (Mr. Frank), the Ranking 
Member of this Committee, for their support in bringing this measure to 
the House floor.
  This legislation, H.R. 2622, is essential since it ensures the 
continuity of the nationwide credit system while providing important 
consumer protections. This Member supports this legislation for many 
reasons. However, he would like to focus on the following three 
reasons.
  First, this legislation provides for a free credit report annually 
for consumers. Typically, credit reporting agencies charge consumers up 
to $9 for the disclosure of the information in their credit files. 
Under current law, a consumer may receive a free consumer report from a 
reporting agency only under certain circumstances, such as when a 
consumer receives a notice of an adverse action by a reporting agency. 
The FACT Act would provide for a free credit report annually for 
consumers for any reason. This Member believes that this provision will 
promote consumer awareness of a person's credit history as well as 
provide an opportunity for the consumer to correct any inaccurate 
information on one's credit report.
  Second, this legislation provides important provisions to curb 
identity theft. To illustrate the need for these provisions, the 
Federal Trade Commission (FTC) released a survey at the beginning of 
September of this year which showed that a staggering 27.3 million 
Americans had been victims of identity theft in the last 5 years, 
including 9.9. million people in the last year alone. This bill 
provides the following consumer protection tools against identity 
theft: Allows consumers to place ``fraud alerts'' in their credit 
reports to prevent identity thieves from opening accounts in their 
names; allows consumers to block information from being given to a 
credit reporting agency and from being reported by this agency if such 
information results from identity theft; and prohibits furnishers of 
credit information from forwarding to reporting agencies information on 
a consumer if the furnisher has substantial doubts as to its accuracy.
  Lastly, this bill continues the Federal preemption of State laws as 
it relates to the corporate affiliate sharing of financial information. 
During the consideration of the 1996 amendments to the FCRA, this 
Member authored a provision, which was signed into law, that required a 
consumer opt-out nontransactional is shared among corporate affiliates. 
Examples of nontransaction information include data from a consumer 
credit report and information on an application such as a consumer's 
income or assets. This provision on consumer notice is very important 
as it was the first consumer ``opt out'' on the sharing of financial 
information that this Member is aware of that was signed into Federal 
law.
  In conclusion, for the reasons stated above and many others, this 
Member encourages his colleagues to support H.R. 2622.
  Mr. CASTLE. Mr. Chairman, I rise today to express my strong support 
for the Fair and Accurate Credit Transactions Act of 2003. This 
bipartisan legislation passed the House Financial Services Committee by 
a vote of 61-3 in July 2003. An overwhelming endorsement which should 
be noted today.
  This legislation is a good bipartisan bill, it is the result of six 
hearings, nearly 100 witnesses, and months of deliberations. Through 
this very thorough process, the Financial Services Committee has 
produced a bill that will protect the financial privacy and access to 
credit for all consumers. Furthermore, it will help our economic 
recovery by ensuring that businesses have access to accurate 
information which provides prompt credit to American consumers.
  As my colleagues know, one of the forces that has helped sustain our 
economy in recent years is consumer spending. A critical factor in 
enabling American consumers to purchase products when they need them 
and want them, is our strong system of consumer credit. That system is 
supported by the Fair Credit Reporting Act, which insures that factual 
information is available on which to base the extension of credit. 
Virtually every business in this Nation, and every consumer that has 
ever used credit, depends on this system.
  One of my constituents, Michael Uffner, President, Chairman and CEO, 
of Auto Team Delaware, testified before the House Financial Services 
Committee this year. Mike Uffner stressed importance of access to 
accurate credit information to serve customers in a timely and fair 
manner. Americans want to be able to walk into an automobile showroom 
and purchase an automobile that day based on a prompt approval of a 
loan based on their credit.
  In December, the national uniform consumer protection standards in 
the Fair Credit Reporting Act will expire. Without this legislation, 
there would be no national standards for consumer protections and 
credit availability. This will negatively affect consumer access to 
credit and the economy as a whole. A failure to pass this legislation 
means higher costs to consumers, who will be paying more for their 
credit without this legislation. In today's economy, rely on instant 
credit, available to us across the country. There is uniformity, this 
is not a state by state issue, as Congress we must protect consumers.
  This legislation has a number of consumer protections, it helps 
protect consumer credit while providing access to greater opportunities 
of credit nationwide. This legislation provides consumers with the 
tools they need to fight identity theft and to ensure the accuracy of 
their credit reports.
  Mr. Chairman, again, I want to express my strong support for this 
bill and urge my colleagues on both sides of the aisle to join the 61 
bipartisan members of the House Financial Services Committee who worked 
together to craft this bill to protect consumers and give confidence to 
businesses. This is a proper step to ensure that all of our 
constituents have access to fair and reasonable credit and information.
  Mr. SCHIFF. Mr. Chairman, I rise today to support the two amendments 
offered by my colleagues from California, Representatives Sherman, Lee, 
and Waters which would protect California's consumer protection laws 
from being preempted by the base bill being debated today. First, let 
me express my appreciation to my colleagues who serve on the Financial 
Services Committee for bringing to this Floor such a strong bipartisan 
bill. H.R. 2622 is important legislation which is necessary to ensure 
the effectiveness of our nation's credit reporting system.

[[Page 21752]]

  It is true, this legislation will extend consumer protections 
currently not afforded to millions of Americans. This is not true, 
however, for Californians. The California Legislature, with 
overwhelming bipartisan and consumer support, has adopted progressive 
and effective financial privacy laws which afford California residents 
the most far reaching consumer protections in the nation.
  Under California law, Californians can correct erroneous credit 
reporting through the filing of police reports, can request a fraud 
alert to be posted on their personal credit reports, have access to 
contact information for those who placed information on their credit 
report, and have the right to remove their names from credit card 
solicitation lists furnished by credit bureaus.
  Most recently, California adopted legislation which requires 
financial institutions to obtain a consumer's affirmative consent 
before sharing information with most third parties and prevents, except 
under certain circumstances, the affiliate sharing of a consumer's 
nonpublic personal information.
  Should this legislation be adopted in its current form and without 
these amendments, perhaps fifteen consumer protections, including those 
which I have just listed, will be preempted. As I said, while many 
Americans will enjoy additional consumer protections through the 
adoption of H.R. 2622, Californian's will lose many of the consumer 
protections which they have come to depend on.
  We should not punish Californians for adopting far reaching consumer 
protections. In fact we should learn form California's example and 
extend these protections to the rest of the nation. And while this 
legislation will help millions of Americans it will be detrimental to 
all Californians.
  All Members should support the amendments offered by Representatives 
Sherman, Lee and Waters to ensure the protection of California law and 
protect a state's right to enact and enforce effective consumer 
protection laws. However, should these amendments not be agreed to 
today, I urge my colleagues to ensure that this issue is corrected in 
the House--Senate Conference Committee on this legislation.
  Finally, H.R. 2622 is necessary and important legislation which would 
only be made better with the adoption of these amendments.
  Mr. RUPPERSBERGER. Mr. Chairman, I have interest in a company that 
does business with a financial institution that one way or another 
might be impacted by this legislation, so I have decided to vote 
present on H.R. 2622, the Fair & Accurate Credit Transactions Act and 
the accompanying amendments on September 10, 2003. This includes all 
roll call votes starting at #495 until the end of the consideration of 
this measure. It also includes any motion to recommit and final passage 
on H.R. 2622, the Fair & Accurate Credit Transaction Act.
  I do support the efforts of this legislation in combating identity 
theft and applaud authors of this measure.
  Mr. OXLEY. Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN. All time for general debate has expired.
  Pursuant to the rule, the amendment in the nature of a substitute 
printed in the bill is considered as an original bill for the purpose 
of amendment and is considered read.
  The text is the amendment in the nature of a substitute is as 
follows:

                               H.R. 2622

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Fair and 
     Accurate Credit Transactions Act of 2003''.
       (b) Table of Contents.--The table of contents for this Act 
     are as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Effective dates.

        TITLE I--UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS

Sec. 101. Uniform national consumer protection standards made 
              permanent.

                  TITLE II--IDENTITY THEFT PREVENTION

Sec. 201. Investigating changes of address and inactive accounts.
Sec. 202. Fraud alerts.
Sec. 203. Truncation of credit card and debit card account numbers.
Sec. 204. Summary of rights of identity theft victims.
Sec. 205. Blocking of information resulting from identity theft.
Sec. 206. Establishment of procedures for depository institutions to 
              identify possible instances of identity theft.
Sec. 207. Study on the use of technology to combat identity theft.

          TITLE III--IMPROVING RESOLUTION OF CONSUMER DISPUTES

Sec. 301. Coordination of consumer complaint investigations.
Sec. 302. Notice of dispute through reseller.
Sec. 303. Reasonable investigation required.
Sec. 304. Duties of furnishers of information.
Sec. 305. Prompt investigation of disputed consumer information.

            TITLE IV--IMPROVING ACCURACY OF CONSUMER RECORDS

Sec. 401. Reconciling addresses.
Sec. 402. Prevention of repollution of consumer reports.
Sec. 403. Notice by users with respect to fraudulent information.
Sec. 404. Disclosure to consumers of contact information for users and 
              furnishers of information in consumer reports.
Sec. 405. FTC study of the accuracy of consumer reports.

     TITLE V--IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT 
                              INFORMATION

Sec. 501. Free reports annually.
Sec. 502. Disclosure of credit scores.
Sec. 503. Simpler and easier method for consumers to use notification 
              system.
Sec. 504. Requirement to disclose communications to a consumer 
              reporting agency.
Sec. 505. Study of effects of credit scores and credit-based insurance 
              scores on availability and affordability of financial 
              products.
Sec. 506. GAO study on disparate impact of credit system.
Sec. 507. Analysis of further restrictions on offers of credit or 
              insurance.
Sec. 508. Study on the need and the means for improving financial 
              literacy among consumers.
Sec. 509. Disclosure of increase in APR under certain circumstances.

        TITLE VI--PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS

Sec. 601. Certain employee investigation communications excluded from 
              definition of consumer report.

 TITLE VII--LIMITING THE USE AND SHARING OF MEDICAL INFORMATION IN THE 
                            FINANCIAL SYSTEM

Sec. 701. Protection of medical information in the financial system.
Sec. 702. Confidentiality of medical information in credit reports.

     SEC. 2. DEFINITIONS.

       Section 603 of the Fair Credit Reporting Act (15 U.S.C. 
     1681a) is amended by adding at the end the following new 
     subsections:
       ``(r) Reseller.--The term `reseller' means a consumer 
     reporting agency that--
       ``(1) assembles and merges information contained in the 
     database of another consumer reporting agency or multiple 
     consumer reporting agencies concerning any consumer for 
     purposes of furnishing such information to any third party, 
     to the extent of such activities; and
       ``(2) does not maintain a database of the assembled or 
     merged information from which new consumer reports are 
     produced.
       ``(s) Other Definitions.--
       ``(1) Board; credit; creditor; credit card.--The terms 
     `Board', `credit', `creditor', and `credit card' have the 
     same meanings as in section 103 of the Truth in Lending Act.
       ``(2) Commission.--The term `Commission' means the Federal 
     Trade Commission.
       ``(3) Debit card.--The term `debit card' means any card 
     issued by a financial institution to a consumer for use in 
     initiating electronic fund transfers (as defined in section 
     903(6) of the Electronic Fund Transfer Act) from the account 
     (as defined in such Act) of the consumer at such financial 
     institution for the purpose of transferring money between 
     accounts or obtaining money, property, labor, or services.
       ``(4) Electronic fund transfer.--The term `electronic fund 
     transfer' has the same meaning as in section 903 of the 
     Electronic Fund Transfer Act.
       ``(5) Federal banking agency.--The term `Federal banking 
     agency' has the same meaning as in section 3 of the Federal 
     Deposit Insurance Act.
       ``(6) Identity theft.--The term `identity theft' means a 
     fraud committed using another person's identifying 
     information, subject to such further definition as the 
     Commission and the Board may prescribe, jointly, by 
     regulation.
       ``(7) Police report.--The term `police report' means a copy 
     of any official valid report filed by a consumer with any 
     appropriate Federal, State, or local government law 
     enforcement agency, or any comparable official government 
     document that the Board and the Commission shall jointly 
     prescribe in regulations, that is subject to a criminal 
     penalty for false statements.''.

     SEC. 3. EFFECTIVE DATES.

       (a) In General.--Except as provided in subsections (b) and 
     (c)--
       (1) before the end of the 2-month period beginning on the 
     date of the enactment of this Act, the Board of Governors of 
     the Federal Reserve System and the Federal Trade Commission 
     shall jointly prescribe regulations in final form 
     establishing effective dates for each provision of this Act 
     (except as otherwise specified); and
       (2) the regulations prescribed under paragraph (1) shall 
     establish effective dates that are as early as possible while 
     allowing a reasonable time for the implementation of the 
     provisions of this Act, but in no case shall the effective 
     date be later than 10 months after the date of issuance of 
     such regulations in final form.

[[Page 21753]]

       (b) Immediate Effective Date.--The following provisions 
     shall take effect on the date of the enactment of this Act:
       (1) Title I.
       (2) Section 201.
       (3) Section 609(d)(1) of the Fair Credit Reporting Act (as 
     added by the amendment in section 204(a)).
       (4) Section 305.
       (5) Section 505.
       (6) Section 506.
       (7) Title VI.
       (c) Effective Date for Protection of Medical Information in 
     the Financial System.--Section 701 shall take effect at the 
     end of the 180-day period beginning on the date of the 
     enactment of this Act, except that paragraph (2) of section 
     604(g) of the Fair Credit Reporting Act (as added by section 
     701) shall take effect on the later of--
       (1) the end of the 90-day period beginning on the date the 
     regulations required under paragraph (5)(B) of such section 
     604(g) (as added by section 701) are prescribed in final 
     form; or
       (2) the date specified in the regulations referred to in 
     paragraph (1).

        TITLE I--UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS

     SEC. 101. UNIFORM NATIONAL CONSUMER PROTECTION STANDARDS MADE 
                   PERMANENT.

       Section 624(d) of the Fair Credit Reporting Act (15 U.S.C. 
     1681t(d)) is amended--
       (1) by striking ``Subsections (b) and (c)'' and all that 
     follows through ``do not affect any settlement,'' and 
     inserting ``Subsections (b) and (c) do not affect any 
     settlement,''; and
       (2) by striking ``Consumer Credit Reporting Reform Act of 
     1996'' and all that follows through the period at the end of 
     paragraph (2) and inserting ``Consumer Credit Reporting 
     Reform Act of 1996.''.

                  TITLE II--IDENTITY THEFT PREVENTION

     SEC. 201. INVESTIGATING CHANGES OF ADDRESS AND INACTIVE 
                   ACCOUNTS.

       (a) In General.--Section 605 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681c) is amended by inserting after 
     subsection (f), the following new subsection:
       ``(g) `Red Flag' Patterns of Possible Identity Theft.--
       ``(1) Investigation of changes of address.--The Federal 
     banking agencies and the National Credit Union 
     Administration, in carrying out the responsibilities of such 
     agencies and Administration under subsection (k), shall 
     jointly prescribe regulations for credit card and debit card 
     issuers to ensure that, if any such issuer receives a request 
     for an additional or replacement card for an existing account 
     within a short period of time after the issuer has received 
     notification of a change of address for the same account, the 
     issuer will follow reasonable policies and procedures that 
     require, as appropriate, that the issuer not issue the 
     additional or replacement card unless the issuer--
       ``(A) notifies the cardholder of the request at the former 
     address of the cardholder and provides to the cardholder a 
     means of promptly reporting incorrect address changes;
       ``(B) notifies the cardholder of the request by such other 
     means of communication as the cardholder and the card issuer 
     previously agreed to; or
       ``(C) uses other means of assessing the validity of the 
     change of address, in accordance with reasonable policies and 
     procedures established by the card issuer in accordance with 
     the regulations prescribed under subsection (k).
       ``(2) Inactive accounts.--The Federal banking agencies and 
     the National Credit Union Administration, in carrying out the 
     responsibilities of such agencies and Administration under 
     subsection (k), shall consider including, as a possible `red 
     flag' pattern, reasonable guidelines providing that when a 
     transaction occurs with respect to a credit or deposit 
     account that has been inactive for more than 2 years, the 
     creditor or depository institution shall follow reasonable 
     policies and procedures that provide for notice to be given 
     to a consumer in a manner reasonably designed to reduce the 
     likelihood of identity theft with respect to such account.''.
       (b) Clerical Amendments.--
       (1) The heading for section 605 of the Fair Credit 
     Reporting Act is amended to read as follows:

     ``Sec. 605. Requirements relating to information contained in 
       consumer reports and to identity theft prevention.''.

       (2) The table of sections for title VI of the Consumer 
     Credit Protection Act is amended by striking the item 
     relating to section 605 and inserting the following new item:

``605. Requirements relating to information contained in consumer 
              reports and to identity theft prevention.''.

       (3) Section 624(b)(1)(E) of the Fair Credit Reporting Act 
     (15 U.S.C. 1681t(b)(1)(E)) is amended by inserting ``and to 
     identity theft prevention'' after ``consumer reports''.

     SEC. 202. FRAUD ALERTS.

       Section 605 of the Fair Credit Reporting Act (15 U.S.C. 
     1681c) is amended by adding at the end the following new 
     subsection:
       ``(i) One-Call Fraud Alerts.--
       ``(1) Initial alerts.--Upon the direct request of a 
     consumer, or an individual acting on behalf of or as a 
     personal representative of a consumer, who asserts, in good 
     faith, a suspicion that the consumer has been or is about to 
     become a victim of fraud or related crime, including identity 
     theft, a consumer reporting agency described in section 
     603(p) shall, if the agency maintains a file on the consumer 
     who is making the request and has a reasonable belief that 
     the agency knows the identity of the consumer--
       ``(A) include a fraud alert in the file of that consumer 
     for a period of not less than 90 days beginning on the date 
     of such request, unless the consumer specifically requests 
     that such fraud alert be removed before the end of such 
     period;
       ``(B) disclose to the consumer that the consumer may 
     request a free copy of the file of the consumer and provide 
     the consumer, upon request, a free disclosure of the 
     consumer's file (as described in section 609(a)) within 3 
     business days after such request;
       ``(C) for 2 years after the date of such request, exclude 
     the consumer from any list of consumers prepared by the 
     agency and provided to any third party to offer credit or 
     insurance to the consumer as part of a transaction that was 
     not initiated by the consumer, unless the consumer 
     subsequently requests that such exclusion be rescinded before 
     the end of such period; and
       ``(D) refer the information regarding the fraud alert to 
     each of the other consumer reporting agencies described in 
     section 603(p), as required under section 621(f)(1).
       ``(2) Extended alerts.--Upon the direct request of a 
     consumer, or an individual acting on behalf of or as a 
     personal representative of a consumer, who contacts a 
     consumer reporting agency described in section 603(p) to 
     report details of an identity theft and submits evidence that 
     provides the agency with reasonable cause to believe that 
     such identity theft has occurred, the agency shall, if the 
     agency maintains a file on the consumer who is making the 
     request and has a reasonable belief that the agency knows the 
     identity of the consumer--
       ``(A) include a fraud alert in the file of that consumer 
     and provide an opportunity for the consumer to extend the 
     alert for a period of up to 7 years from the date of such 
     request, unless the consumer subsequently requests that such 
     fraud alert be removed before the end of such period;
       ``(B) provide the consumer with the option of including 
     more complete information in the consumer's file, including a 
     telephone number or some other reasonable means of 
     communication that any person who requests the consumer's 
     report may utilize for authorization before establishing a 
     new credit plan in the name of the consumer; and
       ``(C) provide the consumer with at least 2 free disclosures 
     of the information described in section 609(a) during the 12-
     month period beginning on the date of such request.
       ``(3) Active duty alerts.--Upon the direct request of an 
     active duty military consumer, or an individual acting on 
     behalf of or as a personal representative of an active duty 
     military consumer, who contacts a consumer reporting agency 
     described in section 603(p), the agency shall, if the agency 
     maintains a file on the consumer who is making the request 
     and has a reasonable belief that the agency knows the 
     identity of the consumer--
       ``(A) include an active duty alert in the file of that 
     consumer during a period of not less than 12 months beginning 
     on the date of the request, unless the consumer requests that 
     such active duty alert be removed before the end of such 
     period;
       ``(B) for 2 years after the date of such request, exclude 
     the consumer from any list of consumers prepared by the 
     agency and provided to any third party to offer credit or 
     insurance to the consumer as part of a transaction that was 
     not initiated by the consumer, unless the consumer 
     subsequently requests that such exclusion be rescinded before 
     the end of such period; and
       ``(C) refer the information regarding the active duty alert 
     to each of the other consumer reporting agencies described in 
     section 603(p), as required under section 621(f)(1).
       ``(4) Procedures.--Each consumer reporting agency described 
     in section 603(p) shall establish policies and procedures to 
     comply with the obligations of paragraphs (1), (2), and (3), 
     including procedures that allow consumers to request initial, 
     extended, or active duty alerts in a simple and easy manner, 
     including by telephone.
       ``(5) Notice to users.--No person who obtains any 
     information that includes a fraud alert under this section 
     from a file of any consumer from a consumer reporting agency 
     may establish a new credit plan in the name of the consumer 
     for a person other than the consumer without utilizing 
     reasonable policies and procedures described in paragraph 
     (9).
       ``(6) Referrals of fraud alerts.--Each consumer reporting 
     agency described in section 603(p) that receives a referral 
     of a fraud alert from another such agency pursuant to 
     paragraph (1)(D) or (3)(C) shall follow the procedures 
     required under subparagraphs (A), (B), and (C) of paragraph 
     (1), in the case of a referral under paragraph (1)(D), and 
     subparagraphs (A) and (B), in the case of a referral under 
     paragraph (3)(C), as if the agency received the request from 
     the consumer directly.
       ``(7) Duty of reseller to reconvey alert.--A reseller that 
     is notified of the existence of a fraud alert in a consumer's 
     consumer report shall communicate to each person procuring a 
     consumer report with respect to such consumer the existence 
     of a fraud alert in effect for such consumer.
       ``(8) Duty of other consumer reporting agencies to provide 
     contact information.--If a consumer contacts any consumer 
     reporting agency that is not a consumer reporting agency 
     described in section 603(p) to communicate a suspicion that 
     the consumer has been or is about to become a victim of fraud 
     or related crime, including identity theft, the agency shall

[[Page 21754]]

     provide the consumer with information on how to contact the 
     Commission and the consumer reporting agencies described in 
     section 603(p) to obtain more detailed information and 
     request alerts under this subsection.
       ``(9) Fraud alert.--
       ``(A) Definition.--For purposes of this subsection, the 
     term `fraud alert' means, at a minimum, a statement--
       ``(i) in the file of a consumer that the consumer may be a 
     victim of fraud, including identity theft, or is a consumer 
     described in paragraph (3); and
       ``(ii) that is transmitted in a manner that facilitates a 
     clear and conspicuous view of the statement by any person 
     requesting such file.
       ``(B) Other information.--A fraud alert shall include 
     information that notifies all prospective users of a consumer 
     report on the consumer to which the alert relates that the 
     consumer does not authorize establishing any new credit plan 
     in the name of the consumer, unless the user utilizes 
     reasonable policies and procedures to form a reasonable 
     belief that the user knows the identity of the person for 
     whom such new plan is established, which may include 
     obtaining authorization or preauthorization of the consumer 
     at a telephone number designated by the consumer or by such 
     other reasonable means agreed to.
       ``(10) Other definitions.--For purposes of this subsection, 
     the following definitions shall apply:
       ``(A) Active duty military consumer.--The term `active duty 
     military consumer' means a consumer in military service who--
       ``(i) is on active duty (as defined in section 101(d)(1) of 
     title 10, United States Code) or is a reservist performing 
     duty under a call or order to active duty under a provision 
     of law referred to in section 101(a)(13) of title 10, United 
     States Code; and
       ``(ii) is assigned to service away from the consumer's 
     usual duty station.
       ``(B) New credit plan.--The term `new credit plan' means a 
     new account under an open end credit plan (as defined in 
     section 103(i) of this Act) or a new credit transaction not 
     under an open end credit plan.''.

     SEC. 203. TRUNCATION OF CREDIT CARD AND DEBIT CARD ACCOUNT 
                   NUMBERS.

       (a) In General.--Section 605 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681c) is amended by inserting after 
     subsection (k) (as added by section 206 of this title) the 
     following new subsection:
       ``(l) Truncation of Credit Card and Debit Card Account 
     Numbers.--
       ``(1) In general.--Except as provided in this subsection, 
     no person that accepts credit cards or debit cards for the 
     transaction of business shall print the expiration date or 
     more than the last 5 digits of the card number upon any 
     receipt provided to the cardholder at the point of the sale 
     or transaction.
       ``(2) Limitation.--This section shall apply only to 
     receipts that are electronically printed, and shall not apply 
     to transactions in which the sole means of recording the 
     person's credit card or debit card number is by handwriting 
     or by an imprint or copy of the card.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply after the end of--
       (1) the 3-year period beginning on the date of the 
     enactment of this Act, with respect to any cash register or 
     other machine or device that electronically prints receipts 
     for credit card or debit card transactions that is in use 
     before January 1, 2005; and
       (2) the 1-year period beginning on the date of the 
     enactment of this Act, with respect to any cash register or 
     other machine or device that electronically prints receipts 
     for credit card or debit card transactions that is first put 
     into use on or after January 1, 2005.

     SEC. 204. SUMMARY OF RIGHTS OF IDENTITY THEFT VICTIMS.

       (a) In General.--Section 609 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681g) is amended by adding at the end the 
     following new subsection:
       ``(d) Summary of Rights of Identity Theft Victims.--
       ``(1) In general.--The Commission, in consultation with the 
     Federal banking agencies and the National Credit Union 
     Administration, shall prepare a model summary of the rights 
     of consumers under this title with respect to the procedures 
     for remedying the effects of fraud or identity theft 
     involving credit, electronic fund transfers, or accounts or 
     transactions at or with a financial institution.
       ``(2) Summary of rights and contact information.--If any 
     consumer contacts a consumer reporting agency and expresses a 
     belief that the consumer is a victim of fraud or identity 
     theft involving credit, electronic fund transfers, or 
     accounts or transactions at or with a financial institution, 
     the consumer reporting agency shall, in addition to any other 
     action the agency may take, provide the consumer with the 
     model summary of rights prepared by the Commission under 
     paragraph (1) and information on how to contact the 
     Commission to obtain more detailed information.''.
       (b) Technical and Conforming Amendment.--Section 624(b)(3) 
     of the Fair Credit Reporting Act (15 U.S.C. 1681t(b)(3)) is 
     amended by striking ``section 609(c)'' and inserting 
     ``subsection (c) or (d) of section 609''.

     SEC. 205. BLOCKING OF INFORMATION RESULTING FROM IDENTITY 
                   THEFT.

       Section 605 of the Fair Credit Reporting Act (15 U.S.C. 
     1681c) is amended by inserting after subsection (i) (as added 
     by section 202 of this title) the following new subsection:
       ``(j) Block of Information Resulting From Identity Theft.--
       ``(1) Block.--Except as provided in paragraph (3), a 
     consumer reporting agency shall block the reporting of any 
     information in the file of a consumer that the consumer 
     identifies as information that resulted from an alleged 
     identity theft and confirms is not information relating to 
     any transaction by the consumer not later than 5 business 
     days after the date of receipt by such agency of--
       ``(A) appropriate proof of the identity of a consumer;
       ``(B) a police report evidencing the claim of the consumer 
     of identity theft;
       ``(C) the identification of the information by the 
     consumer; and
       ``(D) confirmation by the consumer that the information is 
     not information relating to any transaction by the consumer.
       ``(2) Notification.--A consumer reporting agency shall 
     promptly notify the furnisher of information identified by 
     the consumer under paragraph (1)--
       ``(A) that the information may be a result of identity 
     theft;
       ``(B) that a police report has been filed;
       ``(C) that a block has been requested under this 
     subsection; and
       ``(D) of the effective date of the block.
       ``(3) Authority to decline or rescind.--
       ``(A) In general.--A consumer reporting agency may decline 
     to block, or may rescind any block, of consumer information 
     under this subsection if the consumer reporting agency 
     reasonably determines that--
       ``(i) the information was blocked in error or a block was 
     requested by the consumer in error;
       ``(ii) the information was blocked, or a block was 
     requested by the consumer, on the basis of a 
     misrepresentation of fact by the consumer relevant to the 
     request to block; or
       ``(iii) the consumer knowingly obtained possession of 
     goods, services, or moneys as a result of the blocked 
     transaction or transactions, or the consumer should have 
     known that the consumer obtained possession of goods, 
     services, or moneys as a result of the blocked transaction or 
     transactions.
       ``(B) Notification to consumer.--If the block of 
     information is declined or rescinded under this paragraph, 
     the affected consumer shall be notified promptly, in the same 
     manner as consumers are notified of the reinsertion of 
     information under section 611(a)(5)(B).
       ``(C) Significance of block.--For purposes of this 
     paragraph, if a consumer reporting agency rescinds a block, 
     the presence of information in the file of a consumer prior 
     to the blocking of such information is not evidence of 
     whether the consumer knew or should have known that the 
     consumer obtained possession of any goods, services, or 
     monies as a result of the block.
       ``(4) Exceptions.--
       ``(A) Verification companies.--This subsection shall not 
     apply to--
       ``(i) a check services company, which issues authorizations 
     for the purpose of approving or processing negotiable 
     instruments, electronic funds transfers, or similar methods 
     of payments; or
       ``(ii) a deposit account information service company, which 
     issues reports regarding account closures due to fraud, 
     substantial overdrafts, automated teller machine abuse, or 
     similar negative information regarding a consumer, to 
     inquiring banks or other financial institutions for use only 
     in reviewing a consumer request for a deposit account at the 
     inquiring bank or financial institution.
       ``(B) Resellers.--
       ``(i) No reseller file.--This subsection shall not apply to 
     a consumer reporting agency if the consumer reporting 
     agency--

       ``(I) is a reseller;
       ``(II) is not, at the time of the request of the consumer 
     under paragraph (1), otherwise furnishing or reselling a 
     consumer report concerning the information identified by the 
     consumer; and
       ``(III) informs the consumer, by any means, that the 
     consumer may report the identity theft to the Commission to 
     obtain consumer information regarding identity theft.

       ``(ii) Reseller with file.--The sole obligation of the 
     consumer reporting agency under this subsection, with regard 
     to any request of a consumer under this subsection, shall be 
     to block the consumer report maintained by the consumer 
     reporting agency from any subsequent use if--

       ``(I) the consumer, in accordance with the provisions of 
     paragraph (1), identifies, to a consumer reporting agency, 
     information in the file of the consumer that resulted from 
     identity theft; and
       ``(II) the consumer reporting agency is a reseller of the 
     identified information.

       ``(iii) Notice.--In carrying out its obligation under 
     clause (ii), the reseller shall promptly provide a notice to 
     the consumer of the decision to block the file. Such notice 
     shall contain the name, address, and telephone number of each 
     consumer reporting agency from which the consumer information 
     was obtained for resale.
       ``(5) Access to blocked information by law enforcement 
     agencies.--No provision of this subsection shall be construed 
     as requiring a consumer reporting agency to prevent a 
     Federal, State, or local law enforcement agency from 
     accessing blocked information in a consumer file to which the 
     agency could otherwise obtain access under this title.''.

     SEC. 206. ESTABLISHMENT OF PROCEDURES FOR DEPOSITORY 
                   INSTITUTIONS TO IDENTIFY POSSIBLE INSTANCES OF 
                   IDENTITY THEFT.

       (a) In General.--Section 605 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681c) is amended by

[[Page 21755]]

     inserting after subsection (j) (as added by section 205 of 
     this title) the following new subsection:
       ``(k) `Red Flag' Guidelines Required.--
       ``(1) In general.--The Federal banking agencies and the 
     National Credit Union Administration, in consultation with 
     the Commission, shall jointly establish and maintain 
     guidelines for use by insured depository institutions in 
     identifying patterns, practices, and specific forms of 
     activity that indicate the possible existence of identity 
     theft with respect to accounts, and update such guidelines as 
     often as necessary.
       ``(2) Regulations.--The Federal banking agencies and the 
     National Credit Union Administration, in consultation with 
     the Commission, shall jointly prescribe regulations requiring 
     insured depository institutions to establish and adhere to 
     reasonable policies and procedures for implementing the 
     guidelines established pursuant to paragraph (1) to identify 
     possible risks to customer accounts or to the safety and 
     soundness of the institutions.
       ``(3) Consistency with verification requirements.--Policies 
     and procedures established pursuant to paragraph (2) shall 
     not be inconsistent with, or duplicative of, the policies and 
     procedures required under section 5318(l) of title 31, United 
     States Code.
       ``(4) Insured depository institution defined.--For purposes 
     of this subsection, the term `insured depository 
     institution'--
       ``(A) has the meaning given to such term in section 3 of 
     the Federal Deposit Insurance Act; and
       ``(B) includes an insured credit union (as defined in 
     section 101 of the Federal Credit Union Act).''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall take effect at the end of the 1-year period beginning 
     on the date of the enactment of this Act.

     SEC. 207. STUDY ON THE USE OF TECHNOLOGY TO COMBAT IDENTITY 
                   THEFT.

       (a) Study Required.--The Secretary of the Treasury shall 
     conduct a study of the use of biometrics and other similar 
     technologies to reduce the incidence and costs of identity 
     theft by providing convincing evidence of who actually 
     performed a given financial transaction.
       (b) Consultation.--The Secretary of the Treasury shall 
     consult with Federal banking agencies, the Federal Trade 
     Commission, and representatives of financial institutions, 
     credit reporting agencies, Federal, State, and local 
     government agencies that issue official forms or means of 
     identification, State prosecutors, law enforcement agencies, 
     and the biometric industry and other representatives of the 
     general public, in formulating and conducting the study 
     required by subsection (a).
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of the Treasury for 
     fiscal year 2004 such sums as may be necessary to carry out 
     the provisions of this section.
       (d) Report Required.--Before the end of the 180-day period 
     beginning on the date of the enactment of this Act, the 
     Secretary shall submit a report to Congress containing the 
     findings and conclusions of the study required under 
     subsection (a), together with such recommendations for 
     legislative or administrative actions as may be appropriate.

          TITLE III--IMPROVING RESOLUTION OF CONSUMER DISPUTES

     SEC. 301. COORDINATION OF CONSUMER COMPLAINT INVESTIGATIONS.

       Section 621 of the Fair Credit Reporting Act (15 U.S.C. 
     1681s) is amended by adding at the end the following new 
     subsection:
       ``(f) Coordination of Consumer Complaint Investigations.--
       ``(1) In general.--The consumer reporting agencies 
     described in section 603(p) shall develop and maintain 
     procedures for the referral, to each such agency, of any 
     consumer complaint received by any such agency alleging any 
     identity theft or requesting a block or a fraud alert.
       ``(2) Model form and procedure for reporting identity 
     theft.--The Commission, in consultation with the Federal 
     banking agencies and the National Credit Union 
     Administration, shall develop a model form and model 
     procedures to be used by consumers who are victims of 
     identity theft for contacting and informing creditors and 
     consumer reporting agencies of the fraud.
       ``(3) Annual summary reports.--Each consumer reporting 
     agency described in section 603(p) shall submit an annual 
     summary report to the Commission on consumer complaints 
     received by the agency on identity theft or fraud alerts.''.

     SEC. 302. NOTICE OF DISPUTE THROUGH RESELLER.

       (a) Requirement for Reinvestigation of Disputed Information 
     Upon Notice From a Reseller.--Section 611(a) of the Fair 
     Credit Reporting Act (15 U.S.C. 1681i(a)(1)(A)) is amended--
       (1) in subparagraph (A) of paragraph (1)--
       (A) by striking ``If the completeness'' and inserting 
     ``Subject to subsection (e), if the completeness'';
       (B) by inserting ``, or indirectly through a reseller,'' 
     after ``notifies the agency directly''; and
       (C) by inserting ``or reseller'' before the period at the 
     end of such subparagraph;
       (2) in subparagraph (A) of paragraph (2)--
       (A) by inserting ``or a reseller'' after ``dispute from any 
     consumer''; and
       (B) by inserting ``or reseller'' before the period at the 
     end of such subparagraph; and
       (3) in subparagraph (B) of paragraph (2), by inserting ``or 
     the reseller'' after ``from the consumer''.
       (b) Reinvestigation Requirement Applicable to Resellers.--
     Section 611 of the Fair Credit Reporting Act (15 U.S.C. 
     1681i) is amended by adding at the end the following new 
     subsection:
       ``(e) Reinvestigation Requirement Applicable to 
     Resellers.--
       ``(1) Exemption from general reinvestigation requirement.--
     Except as provided in paragraph (2), a reseller shall be 
     exempt from the requirements of this section.
       ``(2) Action required upon receiving notice of a dispute.--
     If a reseller receives a notice from a consumer of a dispute 
     concerning the completeness or accuracy of any item of 
     information contained in a consumer report on such consumer 
     produced by the reseller, the reseller shall, within 5 
     business days of receiving the notice and free of charge--
       ``(A) determine whether the item of information is 
     incomplete or inaccurate as a result of an act or omission of 
     the reseller; and
       ``(B) if--
       ``(i) the reseller determines that the item of information 
     is incomplete or inaccurate as a result of an act or omission 
     of the reseller, correct the information in the consumer 
     report or delete it; or
       ``(ii) if the reseller determines that the item of 
     information is not incomplete or inaccurate as a result of an 
     act or omission of the reseller, convey the notice of the 
     dispute, together with all relevant information provided by 
     the consumer, to each consumer reporting agency that provided 
     the reseller with the information that is the subject of the 
     dispute.
       ``(3) Reseller reinvestigations.--No provision of this 
     subsection shall be construed as prohibiting a reseller from 
     conducting a reinvestigation of a consumer dispute 
     directly.''.
       (c) Technical and Conforming Amendment.--The heading for 
     paragraph (2)(B) of section 611(a) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681i(a)(2)(B)) is amended by 
     striking ``from consumer''.

     SEC. 303. REASONABLE REINVESTIGATION REQUIRED.

       Section 611(a)(1)(A) of the Fair Credit Reporting Act (15 
     U.S.C. 1681i(a)(1)(A)) is amended by striking ``shall 
     reinvestigate free of charge'' and inserting ``shall, free of 
     charge, conduct a reasonable reinvestigation to determine 
     whether the disputed information is inaccurate''.

     SEC. 304. DUTIES OF FURNISHERS OF INFORMATION.

       (a) In General.--Section 623(a) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681s-2(a)) is amended--
       (1) in paragraph (1)(A), by striking ``knows or consciously 
     avoids knowing that the information is inaccurate'' and 
     inserting ``knows or has reasonable cause to believe that the 
     information is inaccurate'';
       (2) in paragraph (1)--
       (A) by redesignating subparagraphs (B) and (C) as 
     subparagraphs (C) and (D), respectively;
       (B) by inserting after subparagraph (A), the following new 
     subparagraph:
       ``(B) Reasonable procedures to ensure accuracy.--A person 
     that regularly furnishes information relating to consumers to 
     a consumer reporting agency described in section 603(p) shall 
     maintain reasonable procedures designed to ensure that the 
     information furnished is accurate.''; and
       (C) by adding at the end the following new subparagraph:
       ``(F) Definition.--For purposes of subparagraph (A), the 
     term `reasonable cause to believe that the information is 
     inaccurate' means, based on the procedures described in 
     subparagraph (B), has knowledge, other than solely 
     allegations by the consumer, that would cause a reasonable 
     person to have substantial doubts about the accuracy of the 
     information.''; and
       (3) by adding at the end the following new paragraph:
       ``(6) Ability of consumer to dispute information directly 
     with furnisher.--
       ``(A) In general.--A consumer may dispute directly with a 
     person the accuracy of information that--
       ``(i) is contained in a consumer report on the consumer 
     prepared by a consumer reporting agency described in section 
     603(p); and
       ``(ii) was provided by the person to that consumer 
     reporting agency in accordance with paragraph (1)(B).
       ``(B) Submitting a notice of dispute.--A consumer who seeks 
     to dispute the accuracy of information with a person under 
     subparagraph (A) shall provide a dispute notice directly to 
     such person at the address specified by the person for such 
     notices that--
       ``(i) identifies the specific information that is being 
     disputed; and
       ``(ii) explains the basis for the dispute.
       ``(C) Duty of person after receiving notice of dispute.--
     After receiving a notice of dispute from a consumer pursuant 
     to subparagraph (B), the person that provided the information 
     in dispute to a consumer reporting agency referred to in 
     subparagraph (A) shall--
       ``(i) conduct an investigation with respect to the disputed 
     information;
       ``(ii) review all relevant information provided by the 
     consumer with the notice;
       ``(iii) complete such person's investigation of the dispute 
     and report the results of the investigation to the consumer 
     before the expiration of the period under section 611(a)(1) 
     within which a consumer reporting agency would be required to 
     complete its action if the consumer had elected to dispute 
     the information under that section; and

[[Page 21756]]

       ``(iv) if the investigation finds that the information 
     reported was inaccurate, promptly thereafter report correct 
     information to each consumer reporting agency described in 
     section 603(p) to which the person furnished the inaccurate 
     information.''.
       (b) Technical and Conforming Amendments.--
       (1) Section 621(c)(5)(A) of the Fair Credit Reporting Act 
     (15 U.S.C. 1681s(c)(5)(A)) is amended by striking ``section 
     623(a)(1)'' and inserting ``paragraph (1) or (6) of section 
     623(a)''.
       (2) The heading for section 621(c)(5) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681s(c)(5)) is amended by striking 
     ``violation of section 623(a)(1)'' and inserting ``certain 
     violations of section 623(a)''.

     SEC. 305. PROMPT INVESTIGATION OF DISPUTED CONSUMER 
                   INFORMATION.

       (a) Study Required.--The Board of Governors of the Federal 
     Reserve System and the Federal Trade Commission shall jointly 
     study the extent to which, and the manner in which, consumer 
     reporting agencies and furnishers of consumer information to 
     consumer reporting agencies are complying with the 
     procedures, time lines, and requirements under the Fair 
     Credit Reporting Act for the prompt investigation of the 
     disputed accuracy of any consumer information, the 
     completeness of the information provided to consumer 
     reporting agencies, and the prompt correction or deletion, in 
     accordance with such Act, of any inaccurate or incomplete 
     information or information that cannot be verified.
       (b) Report Required.--Before the end of the 6-month period 
     beginning on the date of the enactment of this Act, the Board 
     of Governors of the Federal Reserve System and the Federal 
     Trade Commission shall jointly submit a progress report to 
     the Congress on the results of the study required under 
     subsection (a).
       (c) Recommendations.--The report under subsection (b) shall 
     include such recommendations as the Board and the Commission 
     jointly determine to be appropriate for legislative or 
     administrative action to ensure that--
       (1) consumer disputes with consumer reporting agencies over 
     the accuracy or completeness of information in a consumer's 
     file are promptly and fully investigated and any incorrect, 
     incomplete, or unverifiable information is corrected or 
     deleted immediately thereafter;
       (2) furnishers of information to consumer reporting 
     agencies maintain full and prompt compliance with the duties 
     and responsibilities established under section 623 of the 
     Fair Credit Reporting Act; and
       (3) consumer reporting agencies establish and maintain 
     appropriate internal controls and management review 
     procedures for maintaining full and continuous compliance 
     with the procedures, time lines, and requirements under the 
     Fair Credit Reporting Act for the prompt investigation of the 
     disputed accuracy of any consumer information and the prompt 
     correction or deletion, in accordance with such Act, of any 
     inaccurate or incomplete information or information that 
     cannot be verified.
       (d) Definitions.--For purposes of this section, the terms 
     ``consumer'', ``consumer report'', and ``consumer reporting 
     agency'' have the same meaning as in the Fair Credit 
     Reporting Act.

            TITLE IV--IMPROVING ACCURACY OF CONSUMER RECORDS

     SEC. 401. RECONCILING ADDRESSES.

       Section 605 of the Fair Credit Reporting Act (15 U.S.C. 
     1681c) is amended by inserting after subsection (g) (as added 
     by section 201 of this Act) the following new subsection.
       ``(h) Notice of Discrepancy.--
       ``(1) In general.--If a person has requested a consumer 
     report relating to a consumer from a consumer reporting 
     agency described in section 603(p), the request includes an 
     address for the consumer that substantially differs from the 
     addresses in the file of the consumer, and the agency 
     provides a consumer report in response to the request, the 
     consumer reporting agency shall notify the requester of the 
     existence of the discrepancy.
       ``(2) Regulations.--
       ``(A) Regulations required.--The Federal banking agencies 
     and the National Credit Union Administration shall jointly 
     prescribe regulations providing guidance regarding reasonable 
     policies and procedures a user of a consumer report should 
     employ when such user has received a notice of discrepancy 
     under paragraph (1).
       ``(B) Policies and procedures to be included.--The 
     regulations prescribed under subparagraph (A) shall describe 
     reasonable policies and procedures for use by a user of a 
     consumer report--
       ``(i) to form a reasonable belief that the user knows the 
     identity of the person to whom the consumer report pertains; 
     and
       ``(ii) if the user establishes a continuing relationship 
     with the consumer, and the user regularly and in the ordinary 
     course of business furnishes information to the consumer 
     reporting agency from which the notice of discrepancy 
     pertaining to the consumer was obtained, to reconcile the 
     consumer's address with the consumer reporting agency by 
     furnishing such address to such consumer reporting agency as 
     part of information regularly furnished by the user for the 
     period in which the relationship is established.''.

     SEC. 402. PREVENTION OF REPOLLUTION OF CONSUMER REPORTS.

       Section 623(a)(1) of the Fair Credit Reporting Act (15 
     U.S.C. 1681s-2(a)(1)) is amended by inserting after 
     subparagraph (D) (as so redesignated by section 304(2)(A)) 
     the following new subparagraph:
       ``(E) Information alleged to result from identity theft.--
     If a consumer submits a police report to a person who 
     furnishes information to a consumer reporting agency that 
     states that information maintained by such person that 
     purports to relate to the consumer resulted from identity 
     theft, the person may not furnish such information that 
     purports to relate to the consumer to any consumer reporting 
     agency, unless the person subsequently knows or is informed 
     by the consumer that the information is correct.''.

     SEC. 403. NOTICE BY USERS WITH RESPECT TO FRAUDULENT 
                   INFORMATION.

       Section 615 of the Fair Credit Reporting Act (15 U.S.C. 
     1681m) is amended by adding at the end the following new 
     subsection:
       ``(e) Notice of Fraudulent Information Relating to Identity 
     Theft.--If an agent acting as a debt collector (as defined in 
     title VIII) of a person who furnishes information to any 
     consumer reporting agency uses information contained in a 
     consumer report on any consumer and learns that any such 
     information so used is the result of identity theft or 
     otherwise is fraudulent, the agent shall--
       ``(1) if such information--
       ``(A) originated from the person for whom the debt 
     collector is acting as agent, notify the person of the 
     fraudulent information; or
       ``(B) originated from a person other than the person for 
     whom the debt collector is acting as agent, notify the 
     consumer reporting agency (that provided the consumer report) 
     of the fraudulent information, either directly or through the 
     person for whom the debt collector is acting as agent; and
       ``(2) upon the request of the consumer, provide the 
     consumer with all information which the consumer would be 
     entitled to receive if the information related to the 
     consumer other than by reason of identity theft.''.

     SEC. 404. DISCLOSURE TO CONSUMERS OF CONTACT INFORMATION FOR 
                   USERS AND FURNISHERS OF INFORMATION IN CONSUMER 
                   REPORTS.

       Section 609(a) of the Fair Credit Reporting Act (15 U.S.C. 
     1681g(a)) is amended--
       (1) in paragraph (2), by inserting ``, including addresses 
     of the sources, and (if provided by the sources of 
     information) the telephone numbers identified for customer 
     service for the sources of information'' after ``sources of 
     information'' the 1st place such term appears in such 
     paragraph; and
       (2) in paragraph (3)(B) by striking clause (ii) and 
     inserting the following new clause:
       ``(ii) the address and (if provided) the telephone numbers 
     identified for customer service of the person.''.

     SEC. 405. FTC STUDY OF THE ACCURACY OF CONSUMER REPORTS.

       (a) Study Required.--Until the final report is submitted 
     under subsection (b)(2), the Federal Trade Commission shall 
     conduct an ongoing study of the accuracy and completeness of 
     information contained in consumer reports prepared or 
     maintained by consumer reporting agencies and methods for 
     improving the accuracy and completeness of such information.
       (b) Biennial Reports Required.--
       (1) Interim reports.--The Federal Trade Commission shall 
     submit an interim report to the Congress on the study 
     conducted under subsection (a) at the end of the 6-month 
     period beginning on the date of the enactment of this Act and 
     biennially thereafter for 8 years.
       (2) Final report.--The Federal Trade Commission shall 
     submit a final report to the Congress on the study conducted 
     under subsection (a) at the end of the 2-year period 
     beginning on the date the final interim report is submitted 
     to the Congress under paragraph (1).
       (3) Contents.--Each report submitted under this subsection 
     shall contain a detailed summary of the findings and 
     conclusions of the Commission with respect to the study 
     required under subsection (a) and such recommendations for 
     legislative and administrative action as the Commission may 
     determine to be appropriate.

     TITLE V--IMPROVEMENTS IN USE OF AND CONSUMER ACCESS TO CREDIT 
                              INFORMATION

     SEC. 501. FREE REPORTS ANNUALLY.

       (a) Free Reports Annually From Nationwide Consumer 
     Reporting Agencies.--Section 612 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681j) is amended by adding at the end the 
     following new subsection:
       ``(e) Free Annual Disclosure.--Upon the direct request of 
     the consumer, a consumer reporting agency described in 
     section 603(p) shall make all disclosures pursuant to section 
     609 once during any 12-month period without charge to the 
     consumer.''.
       (b) Technical and Conforming Amendment.--Section 612(c) of 
     the Fair Credit Reporting Act (15 U.S.C. 1681j(c)) is amended 
     by inserting ``that is not a consumer reporting agency 
     described in section 603(p)'' after ``consumer reporting 
     agency''.

     SEC. 502. DISCLOSURE OF CREDIT SCORES.

       (a) Statement on Availability of Credit Scores.--Section 
     609(a) of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)) 
     is amended by adding at the end the following new paragraph:
       ``(6) If the consumer requests the credit file and not the 
     credit score, a statement that the consumer may request and 
     obtain a credit score.''.
       (b) Disclosure of Credit Scores.--Section 609 of the Fair 
     Credit Reporting Act (15 U.S.C. 1681g) is amended by 
     inserting after subsection (d) (as added by section 204 of 
     this Act) the following new subsection:
       ``(e) Disclosure of Credit Scores.--

[[Page 21757]]

       ``(1) In general.--Upon the consumer's request for a credit 
     score, a consumer reporting agency shall supply to a consumer 
     a statement indicating that the information and credit 
     scoring model may be different than the credit score that may 
     be used by the lender, and a notice which shall include the 
     following information:
       ``(A) The consumer's current credit score or the consumer's 
     most recent credit score that was previously calculated by 
     the credit reporting agency for a purpose related to the 
     extension of credit.
       ``(B) The range of possible credit scores under the model 
     used.
       ``(C) All the key factors that adversely affected the 
     consumer's credit score in the model used, the total number 
     of which shall not exceed four, subject to paragraph (9).
       ``(D) The date the credit score was created.
       ``(E) The name of the person or entity that provided the 
     credit score or credit file upon which the credit score was 
     created.
       ``(2) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(A) Credit score.--The term `credit score'--
       ``(i) means a numerical value or a categorization derived 
     from a statistical tool or modeling system used by a person 
     who makes or arranges a loan to predict the likelihood of 
     certain credit behaviors, including default (and the 
     numerical value or the categorization derived from this 
     analysis may also be referred to as a `risk predictor' or 
     `risk score'); and
       ``(ii) does not include--

       ``(I) any mortgage score or rating of an automated 
     underwriting system that considers one or more factors in 
     addition to credit information, including the loan to value 
     ratio, the amount of down payment, or a consumer's financial 
     assets; or
       ``(II) any other elements of the underwriting process or 
     underwriting decision.

       ``(B) Key factors.--The term `key factors' means all 
     relevant elements or reasons adversely affecting the credit 
     score for the particular individual listed in the order of 
     their importance based on their effect on the credit score.
       ``(3) Timeframe and manner of disclosure.--The information 
     required by this subsection shall be provided in the same 
     timeframe and manner as the information described in 
     subsection (a).
       ``(4) Applicability to certain uses.--This subsection shall 
     not be construed so as to compel a consumer reporting agency 
     to develop or disclose a score if the agency does not--
       ``(A) distribute scores that are used in connection with 
     residential real property loans; or
       ``(B) develop scores that assist credit providers in 
     understanding a consumer's general credit behavior and 
     predicting the future credit behavior of the consumer.
       ``(5) Applicability to credit scores developed by another 
     person.--
       ``(A) In general.--This subsection shall not be construed 
     to require a consumer reporting agency that distributes 
     credit scores developed by another person or entity to 
     provide a further explanation of them, or to process a 
     dispute arising pursuant to section 611, except that the 
     consumer reporting agency shall provide the consumer with the 
     name and address and website for contacting the person or 
     entity who developed the score or developed the methodology 
     of the score.
       ``(B) Exception.--This paragraph shall not apply to a 
     consumer reporting agency that develops or modifies scores 
     that are developed by another person or entity.
       ``(6) Maintenance of credit scores not required.--This 
     subsection shall not be construed to require a consumer 
     reporting agency to maintain credit scores in its files.
       ``(7) Compliance in certain cases.--In complying with this 
     subsection, a consumer reporting agency shall--
       ``(A) supply the consumer with a credit score that is 
     derived from a credit scoring model that is widely 
     distributed to users by that consumer reporting agency in 
     connection with residential real property loans or with a 
     credit score that assists the consumer in understanding the 
     credit scoring assessment of the credit behavior of the 
     consumer and predictions about the future credit behavior of 
     the consumer; and
       ``(B) a statement indicating that the information and 
     credit scoring model may be different than that used by the 
     lender.
       ``(8) Reasonable fee.--A consumer reporting agency may 
     charge a reasonable fee for providing the information 
     required under this subsection.
       ``(9) Use of enquiries as a key factor.--If a key factor 
     that adversely affects a consumer's credit score consists of 
     the number of enquiries made with respect to a consumer 
     report, that factor shall be included in the disclosure 
     pursuant to paragraph (1)(C) without regard to the numerical 
     limitation in such paragraph.''.
       (c) Disclosure of Credit Scores by Certain Mortgage 
     Lenders.--Section 609 of the Fair Credit Reporting Act (15 
     U.S.C. 1681g) is amended by inserting after subsection (e) 
     (as added by subsection (b) of this section) the following 
     new subsection:
       ``(f) Disclosure of Credit Scores by Certain Mortgage 
     Lenders.--
       ``(1) In general.--Any person who makes or arranges loans 
     and who uses a consumer credit score as defined in subsection 
     (e) in connection with an application initiated or sought by 
     a consumer for a closed end loan or establishment of an open 
     end loan for a consumer purpose that is secured by 1 to 4 
     units of residential real property (hereafter in this 
     subsection referred to as the `lender') shall provide the 
     following to the consumer as soon as reasonably practicable:
       ``(A) Information required under subsection (e).--
       ``(i) In general.--A copy of the information identified in 
     subsection (e) that was obtained from a consumer reporting 
     agency or was developed and used by the user of the 
     information.
       ``(ii) Notice under subparagraph (D).--In addition to the 
     information provided to it by a third party that provided the 
     credit score or scores, a lender is only required to provide 
     the notice contained in subparagraph (D).
       ``(B) Disclosures in case of automated underwriting 
     system.--
       ``(i) In general.--If a person who is subject to this 
     section uses an automated underwriting system to underwrite a 
     loan, that person may satisfy the obligation to provide a 
     credit score by disclosing a credit score and associated key 
     factors supplied by a consumer reporting agency.
       ``(ii) Numerical credit score.--However, if a numerical 
     credit score is generated by an automated underwriting system 
     used by an enterprise, and that score is disclosed to the 
     person, the score shall be disclosed to the consumer 
     consistent with subparagraph (C).
       ``(iii) Enterprise defined.--For purposes of this 
     subparagraph, the term `enterprise' shall have the same 
     meaning as in paragraph (6) of section 1303 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992.
       ``(C) Disclosures of credit scores not obtained from a 
     consumer reporting agency.--A person subject to the 
     provisions of this subsection who uses a credit score other 
     than a credit score provided by a consumer reporting agency 
     may satisfy the obligation to provide a credit score by 
     disclosing a credit score and associated key factors supplied 
     by a consumer reporting agency.
       ``(D) Notice to home loan applicants.--A copy of the 
     following notice, which shall include the name, address, and 
     telephone number of each consumer reporting agency providing 
     a credit score that was used:

                  ```notice to the home loan applicant

       ```In connection with your application for a home loan, the 
     lender must disclose to you the score that a consumer 
     reporting agency distributed to users and the lender used in 
     connection with your home loan, and the key factors affecting 
     your credit scores.
       ```The credit score is a computer generated summary 
     calculated at the time of the request and based on 
     information a consumer reporting agency or lender has on 
     file. The scores are based on data about your credit history 
     and payment patterns. Credit scores are important because 
     they are used to assist the lender in determining whether you 
     will obtain a loan. They may also be used to determine what 
     interest rate you may be offered on the mortgage. Credit 
     scores can change over time, depending on your conduct, how 
     your credit history and payment patterns change, and how 
     credit scoring technologies change.
       ```Because the score is based on information in your credit 
     history, it is very important that you review the credit-
     related information that is being furnished to make sure it 
     is accurate. Credit records may vary from one company to 
     another.
       ```If you have questions about your credit score or the 
     credit information that is furnished to you, contact the 
     consumer reporting agency at the address and telephone number 
     provided with this notice, or contact the lender, if the 
     lender developed or generated the credit score. The consumer 
     reporting agency plays no part in the decision to take any 
     action on the loan application and is unable to provide you 
     with specific reasons for the decision on a loan application.
       ```If you have questions concerning the terms of the loan, 
     contact the lender.'.
       ``(E) Actions not required under this subsection.--This 
     subsection shall not require any person to do any of the 
     following:
       ``(i) Explain the information provided pursuant to 
     subsection (e).
       ``(ii) Disclose any information other than a credit score 
     or key factor, as defined in subsection (e).
       ``(iii) Disclose any credit score or related information 
     obtained by the user after a loan has closed.
       ``(iv) Provide more than 1 disclosure per loan transaction.
       ``(v) Provide the disclosure required by this subsection 
     when another person has made the disclosure to the consumer 
     for that loan transaction.
       ``(F) No obligation for content.--
       ``(i) In general.--Any person's obligation pursuant to this 
     subsection shall be limited solely to providing a copy of the 
     information that was received from the consumer reporting 
     agency.
       ``(ii) Limit on liability.--No person has liability under 
     this subsection for the content of that information or for 
     the omission of any information within the report provided by 
     the consumer reporting agency.
       ``(G) Person defined as excluding enterprise.--As used in 
     this subsection, the term `person' does not include an 
     enterprise (as defined in paragraph (6) of section 1303 of 
     the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992).
       ``(2) Prohibition on disclosure clauses null and void.--
       ``(A) In general.--Any provision in a contract that 
     prohibits the disclosure of a credit score by a person who 
     makes or arranges loans or a consumer reporting agency is 
     void.
       ``(B) No liability for disclosure under this subsection.--A 
     lender shall not have liability under any contractual 
     provision for disclosure of a credit score pursuant to this 
     subsection.''.

[[Page 21758]]

       (d) Inclusion of Key Factor in Credit Score Information in 
     Consumer Report.--Section 605(d) of the Fair Credit Reporting 
     Act (15 U.S.C. 1681c(d)) is amended--
       (1) by striking ``Disclosed.--Any consumer reporting 
     agency'' and inserting ``Disclosed.--
       ``(1) Title 11 information.--Any consumer reporting 
     agency''; and
       (2) by adding at the end the following new paragraph:
       ``(2) Key factor in credit score information.--Any consumer 
     reporting agency that furnishes a consumer report that 
     contains any credit score or any other risk score or 
     predictor on any consumer shall include in the report a clear 
     and conspicuous statement that a key factor (as defined in 
     section 609(e)(2)(B)) that adversely affected such score or 
     predictor was the number of enquiries, if such a predictor 
     was in fact a key factor that adversely affected such 
     score.''.

     SEC. 503. SIMPLER AND EASIER METHOD FOR CONSUMERS TO USE 
                   NOTIFICATION SYSTEM.

       (a) In General.--Section 604(e)(5)(A)(i) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681b(e)(5)(A)(i)) is amended by 
     inserting ``in a simple and easy manner and'' after ``notify 
     the agency,''.
       (b) Simplified Notice and Response Format for Users.--
     Section 615(d) of the Fair Credit Reporting Act (15 U.S.C. 
     1681m(d)) is amended--
       (1) by redesignating paragraphs (2), (3), and (4), as 
     paragraphs (3), (4) and (5); and
       (2) by inserting after paragraph (1) the following new 
     paragraph:
       ``(2) Simple and easy notification.--Any statement given 
     the consumer under paragraph (1)(E) shall be in a simple and 
     easy to understand format and shall describe the simple and 
     easy method established under section 604(e)(5)(A)(i) for the 
     consumer to respond.''.

     SEC. 504. REQUIREMENT TO DISCLOSE COMMUNICATIONS TO A 
                   CONSUMER REPORTING AGENCY.

       (a) In General.--Section 623(a) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681s-2(a)) is amended by inserting 
     after paragraph (6) (as added by section 304(3)) the 
     following new paragraph:
       ``(7) Negative information.--
       ``(A) Notice to consumer required.--
       ``(i) In general.--If any financial institution that 
     extends credit and regularly and in the ordinary course of 
     business furnishes information to a consumer reporting agency 
     described in section 603(p) furnishes negative information to 
     such an agency regarding credit extended to a customer, the 
     financial institution shall provide a notice of such 
     furnishing of negative information, in writing, to the 
     customer.
       ``(ii) Notice effective for subsequent submissions.--After 
     providing such notice, the financial institution may submit 
     additional negative information to a consumer reporting 
     agency described in section 603(p) with respect to the same 
     transaction, extension of credit, account, or customer 
     without providing additional notice to the customer.
       ``(B) Time of notice.--
       ``(i) In general.--The notice required under subparagraph 
     (A) shall be provided to the customer prior to, or no later 
     than 30 days after, furnishing the negative information to a 
     consumer reporting agency described in section 603(p).
       ``(ii) Coordination with new account disclosures.--If the 
     notice is provided to the customer prior to furnishing the 
     negative information to a consumer reporting agency, the 
     notice may not be included in the initial disclosures 
     provided under section 127(a) of the Truth in Lending Act.
       ``(C) Coordination with other disclosures.--The notice 
     required under subparagraph (A)--
       ``(i) may be included on or with any notice of default, any 
     billing statement, or any other materials provided to the 
     customer; and
       ``(ii) must be clear and conspicuous.
       ``(D) Model disclosure.--
       ``(i) Duty of board to prepare.--The Board shall prescribe 
     a brief model disclosure a financial institution may use to 
     comply with subparagraph (A), which shall not exceed 30 
     words.
       ``(ii) Use of model not required.--No provision of this 
     paragraph shall be construed as requiring a financial 
     institution to use any such model form prescribed by the 
     Board.
       ``(iii) Compliance using model.--A financial institution 
     shall be deemed to be in compliance with subparagraph (A) if 
     the financial institution uses any such model form prescribed 
     by the Board, or the financial institution uses any such 
     model form and rearranges its format.
       ``(E) Use of notice without submitting negative 
     information.--No provision of this paragraph shall be 
     construed as requiring a financial institution that has 
     provided a customer with a notice described in subparagraph 
     (A) to furnish negative information about the customer to a 
     consumer reporting agency.
       ``(F) Safe harbor.--A financial institution shall not be 
     liable for failure to perform the duties required by this 
     paragraph if, at the time of the failure, the financial 
     institution maintained reasonable policies and procedures to 
     comply with this paragraph.
       ``(G) Definitions.--For purposes of this paragraph, the 
     following definitions shall apply:
       ``(i) Negative information.--The term `negative 
     information' means information concerning a customer's 
     delinquencies, late payments, insolvency, or any form of 
     default.
       ``(ii) Customer; financial institution.--The terms 
     `customer' and `financial institution' have the same meaning 
     as in section 509 of the Gramm-Leach-Bliley Act.''.
       (b) Model Disclosure Form.--Before the end of the 6-month 
     period beginning on the date of the enactment of this Act, 
     the Board of Governors of the Federal Reserve System shall 
     adopt the model disclosure required under the amendment made 
     by subsection (a) after notice duly given in the Federal 
     Register and an opportunity for public comment in accordance 
     with section 553 of title 5, United States Code.

     SEC. 505. STUDY OF EFFECTS OF CREDIT SCORES AND CREDIT-BASED 
                   INSURANCE SCORES ON AVAILABILITY AND 
                   AFFORDABILITY OF FINANCIAL PRODUCTS.

       (a) Study Required.--The Federal Trade Commission, in 
     consultation with the Office of Fair Housing and Equal 
     Opportunity of the Department of Housing and Urban 
     Development, shall conduct a study of--
       (1) the effects of the use of credit scores and credit-
     based insurance scores on the availability and affordability 
     of financial products and services, including credit cards, 
     mortgages, auto loans, and property and casualty insurance;
       (2) the degree of causality between the factors considered 
     by credit score systems and the quantifiable risks and actual 
     losses experienced by businesses, including the extent to 
     which, if any, each of the factors considered or otherwise 
     taken into account by such systems are accurate predictors of 
     risk or loss, and where the means square error of a scoring 
     model's predictions are considered in the evaluation of 
     accuracy;
       (3) the extent to which, if any, the use of credit scoring 
     models, credit scores and credit-based insurance scores 
     result in disparate impact by geography, income, ethnicity, 
     race, color, religion, national origin, age, sex or marital 
     status, and creed, including the extent to which the 
     consideration or lack of consideration of certain factors by 
     credit scoring systems could result in disparate effects and 
     the extent to which, if any, the use of underwriting systems 
     relying on these models could achieve comparable results 
     through the use of factors with less disparate impact; and
       (4) the extent to which credit scoring systems are used by 
     businesses, the factors considered by such systems, and the 
     effects of variables which are not considered by such 
     systems.
       (b) Public Participation.--The Commission shall seek public 
     input about the prescribed methodology and research design of 
     the study required in subsection (a).
       (c) Report Required.--
       (1) In general.--Before the end of the 18-month period 
     beginning on the date of the enactment of this Act, the 
     Federal Trade Commission shall submit a detailed report on 
     the study conducted pursuant to subsection (a) to the 
     Committee on Financial Services of the House of 
     Representatives and the Committee on Banking, Housing, and 
     Urban Affairs of the Senate.
       (2) Contents of report.--The report submitted under 
     paragraph (1) shall include the findings and conclusions of 
     the Commission, together with such recommendations for 
     legislative or administrative action as the Commission may 
     determine to be necessary to ensure that credit and credit-
     based insurances score are used appropriately and fairly to 
     avoid disparate effects.
       (d) Credit Score Defined.--For purposes of this section, 
     the term ``credit score'' means a numerical value or a 
     categorization derived from a statistical tool or modeling 
     system used to predict the likelihood of certain credit or 
     insurance behaviors, including default.

     SEC. 506. GAO STUDY ON DISPARATE IMPACT OF CREDIT SYSTEM.

       (a) Study Required.--The Comptroller General shall conduct 
     a study of the credit system to determine the extent to 
     which, if any, discrimination exists with regard to the 
     availability and the terms of credit which has a disparate 
     impact on the basis of race, color, income and education 
     level, geographic location, age, sex, sexual orientation, 
     national origin, or marital status and the nature of any such 
     discriminatory effect.
       (b) Report Required.--Before the end of the 2-year period 
     beginning on the date of the enactment of this Act, the 
     Comptroller General shall submit a report to the Congress on 
     the findings and conclusions of the Comptroller General 
     pursuant to the study conducted under subsection (a), 
     together with such recommendations for legislative or 
     administrative action as the Comptroller General may 
     determine to be appropriate.

     SEC. 507. ANALYSIS OF FURTHER RESTRICTIONS ON OFFERS OF 
                   CREDIT OR INSURANCE.

       (a) In General.--The Board of Governors of the Federal 
     Reserve System shall conduct a study of--
       (1) the ability of consumers to avoid receiving written 
     offers of credit or insurance in connection with transactions 
     not initiated by the consumer; and
       (2) the potential impact any further restrictions on 
     providing consumers with such written offers of credit or 
     insurance would have on consumers.
       (b) Report.--The Board of Governors of the Federal Reserve 
     System shall submit a report summarizing the results of the 
     study required under subsection (a) to the Congress no later 
     than 12 months after the date of the enactment of this Act, 
     together with such recom-
     mendations for legislative or administrative action as the 
     Board may determine to be appropriate.
       (c) Content of Report.--The report described in subsection 
     (b) shall address the following issues:
       (1) The current statutory or voluntary mechanisms that are 
     available to a consumer to notify

[[Page 21759]]

     lenders and insurance providers that the consumer does not 
     wish to receive written offers of credit or insurance.
       (2) The extent to which consumers are currently utilizing 
     existing statutory and voluntary mechanisms to avoid 
     receiving offers of credit or insurance.
       (3) The benefits provided to consumers as a result of 
     receiving written offers of credit or insurance.
       (4) Whether consumers incur significant costs or are 
     otherwise adversely affected by the receipt of written offers 
     of credit or insurance.
       (5) Whether further restricting the ability of lenders and 
     insurers to provide written offers of credit or insurance to 
     consumers would affect--
       (A) the cost consumers pay to obtain credit or insurance;
       (B) the availability of credit or insurance;
       (C) consumers' knowledge about new or alternative products 
     and services;
       (D) the ability of lenders or insurers to compete with one 
     another; and
       (E) the ability to offer credit or insurance products to 
     consumers who have been traditionally underserved.

     SEC. 508. STUDY ON THE NEED AND THE MEANS FOR IMPROVING 
                   FINANCIAL LITERACY AMONG CONSUMERS.

       (a) Study Required.--The Comptroller General shall conduct 
     a study to assess the extent of consumers' knowledge and 
     awareness of credit reports, credit scores, and the dispute 
     resolution process, and on methods for improving financial 
     literacy among consumers.
       (b) Factors To Be Included.--The study required under 
     subsection (a) shall include the following issues:
       (1) The number of consumers who view their credit reports.
       (2) Under what conditions and for what purposes do 
     consumers primarily obtain a copy of their consumer report 
     (such as for the purpose of ensuring the completeness and 
     accuracy of the contents, to protect against fraud, in 
     response to an adverse action based on the report, or in 
     response to suspected identity theft) and approximately what 
     percentage of the total number of consumers who obtain a copy 
     of their consumer report do so for each such primary purpose.
       (3) The extent of consumers' knowledge of the data 
     collection process.
       (4) The extent to which consumers know how to get a copy of 
     a consumer report.
       (5) The extent to which consumers know and understand the 
     factors that positively or negatively impact credit scores.
       (c) Report Required.--Before the end of the 9-month period 
     beginning on the date of the enactment of this Act, the 
     Comptroller General shall submit a report to the Congress on 
     the findings and conclusions of the Comptroller General 
     pursuant to the study conducted under subsection (a), 
     together with such recommendations for legislative or 
     administrative action as the Comptroller General may 
     determine to be appropriate, including recommendations on 
     methods for improving financial literacy among consumers.

     SEC. 509. DISCLOSURE OF INCREASE IN APR UNDER CERTAIN 
                   CIRCUMSTANCES.

       Section 609 of the Fair Credit Reporting Act (15 U.S.C. 
     1681m) is amended by inserting after subsection (f) (as added 
     by section 502(c) of this title) the following new 
     subsection:
       ``(g) Disclosure to Consumer.--
       ``(1) In general.--The ability of a credit card issuer to 
     increase any annual percentage rate applicable to a credit 
     card account, or to remove or increase any introductory 
     annual percentage rate of interest applicable to such 
     account, for reasons other than actions or omissions of the 
     card holder that are directly related to such account shall 
     be clearly and conspicuously disclosed to the consumer by the 
     credit card issuer in any disclosure or statement required to 
     be made to the consumer under this title in connection with a 
     credit card solicitation that is not initiated by the 
     consumer.
       ``(2) Regulations and model statements.--The Board, in 
     consultation with the Federal banking agencies and the 
     National Credit Union Administration, shall develop such 
     guidelines in regulations as necessary to assure that the 
     information to be disclosed to consumers pursuant to 
     paragraph (1) is clearly and conspicuously provided in a 
     prominent location in any credit card solicitation that is 
     not initiated by the consumer, and shall include model 
     disclosure statements to be used by credit card issuers in 
     making the disclosures required to be provided to the 
     consumer by paragraph (1).''.

        TITLE VI--PROTECTING EMPLOYEE MISCONDUCT INVESTIGATIONS

     SEC. 601. CERTAIN EMPLOYEE INVESTIGATION COMMUNICATIONS 
                   EXCLUDED FROM DEFINITION OF CONSUMER REPORT.

       (a) In General.--Section 603 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681a) is amended by inserting after 
     subsection (p) the following new subsection:
       ``(q) Exclusion of Certain Communications for Employee 
     Investigations.--
       ``(1) Communications described in this subsection.--A 
     communication is described in this subsection if--
       ``(A) but for subsection (d)(2)(D), the communication would 
     be a consumer report;
       ``(B) the communication is made to an employer in 
     connection with an investigation of--
       ``(i) suspected misconduct relating to employment; or
       ``(ii) compliance with Federal, State, or local laws and 
     regulations, the rules of a self-regulatory organization, or 
     any preexisting written policies of the employer;
       ``(C) the communication is not made for the purpose of 
     investigating a consumer's credit worthiness, credit 
     standing, or credit capacity; and
       ``(D) the communication is not provided to any person 
     except--
       ``(i) to the employer or an agent of the employer;
       ``(ii) to any Federal or State officer, agency, or 
     department, or any officer, agency, or department of a unit 
     of general local government;
       ``(iii) to any self-regulatory organization with regulatory 
     authority over the activities of the employer or employee;
       ``(iv) as otherwise required by law; or
       ``(v) pursuant to section 608.
       ``(2) Subsequent disclosure.--After taking any adverse 
     action based in whole or in part on a communication described 
     in paragraph (1), the employer shall disclose to the consumer 
     a summary containing the nature and substance of the 
     communication upon which the adverse action is based, except 
     that the sources of information acquired solely for use in 
     preparing what would be but for subsection (d)(2)(D) an 
     investigative consumer report need not be disclosed.
       ``(3) Self-regulatory organization defined.--For purposes 
     of this subsection, the term `self-regulatory organization' 
     includes any self-regulatory organization (as defined in 
     section 3(a)(26) of the Securities Exchange Act of 1934), any 
     entity established under title I of the Sarbanes-Oxley Act of 
     2002, any board of trade designated by the Commodity Futures 
     Trading Commission, and any futures association registered 
     with such Commission.''.
       (b) Technical and Conforming Amendment.--Section 
     603(d)(2)(D) of the Fair Credit Reporting Act (15 U.S.C. 
     1681a(d)(2)(D)) is amended by inserting ``or (q)'' after 
     ``subsection (o)''.

 TITLE VII--LIMITING THE USE AND SHARING OF MEDICAL INFORMATION IN THE 
                            FINANCIAL SYSTEM

     SEC. 701. PROTECTION OF MEDICAL INFORMATION IN THE FINANCIAL 
                   SYSTEM

       (a) In General.--Section 604(g) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681b(g)) is amended to read as 
     follows:
       ``(g) Protection of Medical Information.--
       ``(1) Limitation on consumer reporting agencies.--A 
     consumer reporting agency shall not furnish for employment 
     purposes, or in connection with a credit or insurance 
     transaction, a consumer report that contains medical 
     information about a consumer, unless--
       ``(A) if furnished in connection with an insurance 
     transaction, the consumer affirmatively consents to the 
     furnishing of the report;
       ``(B) if furnished for employment purposes or in connection 
     with a credit transaction--
       ``(i) the information to be furnished is relevant to 
     process or effect the employment or credit transaction; and
       ``(ii) the consumer provides specific written consent for 
     the furnishing of the report that describes in clear and 
     conspicuous language the use for which the information will 
     be furnished; or
       ``(C) such information is restricted or reported using 
     codes that do not identify, or provide information sufficient 
     to infer, the specific provider or the nature of such 
     services, products, or devices to a person other than the 
     consumer, unless the report is being provided to an insurance 
     company for a purpose relating to engaging in the business of 
     insurance other than property and casualty insurance.
       ``(2) Limitation on creditors.--Except as permitted 
     pursuant to paragraph (3)(C) or regulations prescribed under 
     paragraph (5)(A), a creditor shall not obtain or use medical 
     information pertaining to a consumer in connection with any 
     determination of the consumer's eligibility, or continued 
     eligibility, for credit.
       ``(3) Actions authorized by federal law, insurance 
     activities and regulatory determinations.--Section 603(d)(3) 
     shall not be construed so as to treat information or any 
     communication of information as a consumer report if the 
     information or communication is disclosed--
       ``(A) in connection with the business of insurance or 
     annuities, including the activities described in section 18B 
     of the model Privacy of Consumer Financial and Health 
     Information Regulation issued by the National Association of 
     Insurance Commissioners (as in effect on January 1, 2003);
       ``(B) for any purpose permitted without authorization under 
     the Standards for Individually Identifiable Health 
     Information promulgated by the Department of Health and Human 
     Services pursuant to the Health Insurance Portability and 
     Accountability Act of 1996, or referred to under section 1179 
     of such Act, or described in section 502(e) of Public Law 
     106-102; or
       ``(C) as otherwise determined to be necessary and 
     appropriate, by regulation or order and subject to paragraph 
     (6), by the Commission, any Federal banking agency or the 
     National Credit Union Administration (with respect to any 
     financial institution subject to the jurisdiction of such 
     agency or Administration under paragraph (1), (2), or (3) of 
     section 621(b), or the applicable State insurance authority 
     (with respect to any person engaged in providing insurance or 
     annuities).
       ``(4) Limitation on redisclosure of medical information.--
     Any person that receives medical information pursuant to 
     paragraphs (1) or (3) shall not disclose such information to 
     any other person except as necessary to carry out the purpose 
     for which the information was initially disclosed, or as 
     otherwise permitted by statute, regulation, or order.

[[Page 21760]]

       ``(5) Regulations and effective date for paragraph (2).--
       ``(A) Regulations required.--Each Federal banking agency 
     and the National Credit Union Administration shall, subject 
     to paragraph (6) and after notice and opportunity for 
     comment, prescribe regulations that permit transactions under 
     paragraph (2) that are determined to be necessary and 
     appropriate to protect legitimate operational, transactional, 
     risk, consumer, and other needs, consistent with the intent 
     of paragraph (2) to restrict the use of medical information 
     for inappropriate purposes.
       ``(B) Final regulations required.--The Federal banking 
     agencies and the National Credit Union Administration shall 
     prescribe the regulations required under subparagraph (A) in 
     final form before the end of the 6-month period beginning on 
     the date of the enactment of the Fair and Accurate Credit 
     Transactions Act of 2003.
       ``(6) Coordination with other laws.--No provision of this 
     subsection shall be construed as altering, affecting, or 
     superseding the applicability of any other provision of 
     Federal law relating to medical confidentiality.''.
       (b) Restriction on Sharing of Medical Information.--Section 
     603(d) of the Fair Credit Reporting Act (15 U.S.C. 1681a(d)) 
     is amended--
       (1) in paragraph (2), by striking ``The term'' and 
     inserting ``Except as provided in paragraph (3), the term''; 
     and
       (2) by adding at the end the following new paragraph:
       ``(3) Restriction on sharing of medical information.--
     Except for information or any communication of information 
     disclosed as provided in section 604(g)(3), the exclusions in 
     paragraph (2) shall not apply with respect to information 
     disclosed to any person related by common ownership or 
     affiliated by corporate control if--
       ``(A) the information is medical information; or
       ``(B) the information is an individualized list or 
     description based on a consumer's payment transactions for 
     medical products or services, or an aggregate list of 
     identified consumers based on payment transactions for 
     medical products or services.''.

     SEC. 702. CONFIDENTIALITY OF MEDICAL CONTACT INFORMATION IN 
                   CREDIT REPORTS.

       (a) Duties of Medical Information Furnishers.--Section 
     623(a) of the Fair Credit Reporting Act (15 U.S.C. 1681s-
     2(a)) is amended by inserting after paragraph (7) (as added 
     by section 504(a)) the following new paragraph:
       ``(8) Duty to provide notice of status as medical 
     information furnisher.--A person whose primary business is 
     providing medical services, products, or devices, or the 
     person's agent or assignee, who furnishes information to a 
     consumer reporting agency on a consumer shall be considered a 
     medical information furnisher for the purposes of this title 
     and shall notify the agency of such status.''.
       (b) Restriction of Dissemination of Medical Contact 
     Information.--Section 605(a) of the Fair Credit Reporting Act 
     (15 U.S.C. 1681c(a)) is amended by adding the following new 
     paragraph:
       ``(6) The name, address, and telephone number of any 
     medical information furnisher that has notified the agency of 
     its status, unless--
       ``(A) such name, address, and telephone number are 
     restricted or reported using codes that do not identify, or 
     provide information sufficient to infer, the specific 
     provider or the nature of such services, products, or devices 
     to a person other than the consumer; or
       ``(B) the report is being provided to an insurance company 
     for a purpose relating to engaging in the business of 
     insurance other than property and casualty insurance.''.
       (c) No Exceptions Allowed for Dollar Amounts.--Section 
     605(b) of the Fair Credit Reporting Act (15 U.S.C. 1681c(b)) 
     is amended by striking ``The provisions of subsection (a)'' 
     and inserting ``The provisions of paragraphs (1) through (5) 
     of subsection (a)''.
       (d) Coordination With Other Laws.--No provision of any 
     amendment made by this section shall be construed as 
     altering, affecting, or superseding the applicability of any 
     other provision of Federal law relating to medical 
     confidentiality.
       (e) FTC Regulation of Coding of Trade Names.--Section 621 
     of the Fair Credit Reporting Act (15 U.S.C. 1681s) is amended 
     by inserting after subsection (f) (as added by section 301 of 
     this Act) the following new subsection:
       ``(g) FTC Regulation of Coding of Trade Names.--If the 
     Commission determines that a person described in paragraph 
     (8) of section 623(a) has not met the requirements of such 
     paragraph, the Commission shall take action to ensure the 
     person's compliance with such paragraph, which may include 
     issuing model guidance or prescribing reasonable policies and 
     procedures as necessary to ensure that such person complies 
     with such paragraph.''.
       (f) Technical and Conforming Amendments.--Section 604(g) of 
     the Fair Credit Reporting Act (15 U.S.C. 1681b(g)) (as 
     amended by section 701) is amended--
       (1) in paragraph (1) by inserting ``(other than medical 
     contact information treated in the manner required under 
     section 605(a)(6))'' after ``a consumer report that contains 
     medical information''; and
       (2) in paragraph (2) by inserting ``(other than medical 
     information treated in the manner required under section 
     605(a)(6))'' after ``a creditor shall not obtain or use 
     medical information''.
       (g) Effective Date.--The amendments made by this section 
     shall take effect at the end of the 15-month period beginning 
     on the date of the enactment of this Act.

  The CHAIRMAN. No amendment to that amendment shall be in order except 
those printed in the designated place in the Congressional Record and 
pro forma amendments for the purposes of debate. Amendments printed in 
the Record may be offered only by the Member who caused it to be 
printed or his designee and shall be considered read.
  Are there amendments to the bill?


                 Amendment No. 17 Offered by Mr. Oxley

  Mr. OXLEY. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 17 offered by Mr. Oxley:
       Page 7, after line 9, insert the following new subsection:
       (d) Criteria for Orderly Implementation of Free Annual 
     Credit Report Provision.--
       (1) In general.--In developing the regulations and 
     effective dates under subsection (a) (and subject to the time 
     limits in paragraph (2) and subsection (a)), the Federal 
     Trade Commission and the Board of Governors of the Federal 
     Reserve System shall provide a systematic approach for 
     implementing the amendment made by section 501 that allows 
     for an orderly transition to the consumer report distribution 
     system required by the amendment in a manner that--
       (A) does not temporarily overwhelm consumer reporting 
     agencies with requests for disclosures of consumer reports 
     beyond their capacity to deliver; and
       (B) does not deny creditors, other users, and consumers 
     access to consumer credit reports on a time-sensitive basis 
     for specific purposes, such as home purchases or suspicions 
     of identity theft, during the transition period.
       (2) Prohibition on extension of effective date.--
       (A) One-time authorization.--The Federal Trade Commission 
     and the Board of Governors of the Federal Reserve System may 
     exercise the authority provided under paragraph (1) only once 
     during the 2-month period referred to in subsection (a)(1).
       (B) Extension of effective date prohibited.--No provision 
     of this subsection shall be construed as extending, or 
     authorizing the Federal Trade Commission or the Board of 
     Governors of the Federal Reserve System to extend, the 2-
     month period referred to in subsection (a)(1) or the 10-month 
     period referred to in subsection (a)(2) relating to the 
     requirements imposed on consumer reporting agencies by the 
     amendment made by section 501.
       Page 10, strike line 12 and insert ``inserting `(and to 
     specific identity theft prevention subjects covered)' 
     after''.
       Page 20, line 7, insert ``a summary of rights, or other 
     disclosure, that is the same as or substantially similar to'' 
     after ``with''.
       Page 20, after line 14, insert the following new 
     subsection:
       (c) Effective Date.--Paragraph (2) of section 609(d) of the 
     Fair Credit Reporting Act (as added by subsection (a) of this 
     section) shall apply after the end of the 60-day period 
     beginning on the date the model summary of rights is 
     prescribed in final form by the Federal Trade Commission 
     pursuant to paragraph (1) of such section and in accordance 
     with section 3(a) of this Act.
       Page 27, line 4, strike ``, or duplicative of,''.
       Page 28, line 4, strike ``credit'' and insert ``consumer''.
       Page 28, strike line 7 and insert ``the biometric industry, 
     and the''.
       Page 28, line 8, strike the comma after ``public''.
       Page 32, line 11, insert ``, using an address or a 
     notification mechanism specified by the consumer reporting 
     agency for such notices'' before the period.
       Page 35, beginning on line 25, strike ``thereafter report 
     correct information to'' and insert ``notify''.
       Page 36, line 3, strike the period, the closing quotation 
     marks, and the second period and insert ``of that 
     determination and provide to the agency any correction to 
     that information that is necessary to make the information 
     provided by the person accurate.''.
       Page 36, after line 3, insert the following new 
     subparagraph:
       ``(D) Frivolous or irrelevant dispute.--
       ``(i) In general.--The requirements of this paragraph shall 
     not apply if the person receiving a notice of a dispute from 
     a consumer reasonably determines that the dispute is 
     frivolous or irrelevant, including--

       ``(I) by reason of the failure of a consumer to provide 
     sufficient information to investigate the disputed 
     information; or
       ``(II) the submission by a consumer of a dispute that is 
     substantially the same as a dispute previously submitted by 
     or for the consumer, either directly to the person under this 
     paragraph or through a consumer reporting agency under 
     subsection (b), with respect to which the person has already 
     performed the person's duties under this paragraph or 
     subsection (b), as applicable.

[[Page 21761]]

       ``(ii) Notice of determination.--Upon making any 
     determination under clause (i) that a dispute is frivolous or 
     irrelevant, the person shall notify the consumer of such 
     determination not later than 5 business days after making 
     such determination, by mail or, if authorized by the consumer 
     for that purpose, by any other means available to the person.
       ``(iii) Contents of notice.--A notice under clause (ii) 
     shall include--

       ``(I) the reasons for the determination under clause (i); 
     and
       ``(II) identification of any information required to 
     investigate the disputed information, which may consist of a 
     standardized form describing the general nature of such 
     information.''.

       Page 56, line 16, insert before the closing quotation marks 
     the following new sentence: ``This paragraph shall not apply 
     to a person described in subsection (j)(4)(A)(i), but only to 
     the extent that such person is engaged in activities 
     described in such subsection.''.
       Page 60, line 16, insert ``or the financial institution 
     reasonably believed that the institution is prohibited, by 
     law, from contacting the consumer'' before the period.
       Page 73, strike line 6 and all that follows through line 
     14, and insert the following new subparagraph:
       ``(C) the information to be furnished pertains solely to 
     transactions, accounts, or balances relating to debts arising 
     from the receipt of medical services, products, or devices, 
     where such information, other than account status or amounts, 
     is restricted or reported using codes that do not identify, 
     or do not provide information sufficient to infer, the 
     specific provider or the nature of such services, products, 
     or devices, as provided in section 605(a)(6)).
       Page 75, line 8, strike ``purpose'' and insert 
     ``purposes''.
       Page 75, line 21, insert ``(and which shall include 
     permitting actions necessary for administrative verification 
     purposes)'' after ``needs''.

  Mr. OXLEY. Mr. Chairman, I am pleased to offer this manager's 
amendment, which reflects extensive negotiations with the committee's 
ranking minority member, the gentleman from Massachusetts (Mr. Frank), 
to resolve issues that arose when the committee marked up this 
legislation in July. The amendment makes largely technical and 
conforming changes to legislation that the committee overwhelmingly 
approved by a vote of 61 to 3.
  First, the amendment clarifies that while the new consumer 
protections against identity theft create uniform standards preempting 
State laws on the same specific subjects, the bill does not preempt 
subject matters that are outside the scope of those new provisions, 
such as limits on Social Security number use or criminal penalties for 
identity theft perpetrators. This approach assures that the strong new 
identity theft protections we establish in this legislation are applied 
uniformly across the country, while leaving undisturbed those State 
statutes that address subjects not covered by the bill's identity theft 
provisions.
  Second, the amendment includes language responsive to concerns raised 
by several members at the Committee on Financial Services's markup of 
the FACT Act relating to the new furnisher reinvestigation duties 
imposed by section 304 of the bill.
  Specifically, the manager's amendment gives furnishers the same right 
to reject frivolous or irrelevant disputes brought by consumers that 
credit bureaus have under existing law, including disputes already 
submitted to and resolved by the furnisher or a credit bureau. The 
furnisher is required to provide the consumer whose dispute it rejects 
as frivolous or irrelevant with a notice stating the reasons for that 
determination and identifying any information required to investigate 
the disputed information.
  Third, the manager's amendment gives direction to the Federal 
regulators who are required to promulgate regulations establishing 
effective dates for various provisions of the bill to take into account 
the need for an orderly transition to a system in which consumers will 
be able to request a free credit report annually, to avoid overwhelming 
the credit bureaus and impeding their ability to satisfy time-sensitive 
requests for reports within the 2- to 12-month effective date provided 
in the legislation.
  Let me again thank the ranking member, the gentleman from 
Massachusetts (Mr. Frank), for the cooperative spirit in which he and 
his staff have worked with us since the committee's markup to make 
these important improvements to what was an already outstanding piece 
of legislation. I urge all of my colleagues to support the amendment.
  Mr. FRANK of Massachusetts. Mr. Chairman, I rise in support of the 
amendment.
  Mr. Chairman, I support this amendment. It is better than we got. It 
is not all I want, but it improves the bill, as is appropriate for this 
particular form of a non-controversial amendment in a technical way. It 
embodies some improvement in the situation vis-a-vis the retroactive 
California preemption that was embodied in the colloquy.
  The colloquy that the gentleman from Alabama and the gentleman from 
Ohio and I had is really an explanation of what is in this particular 
manager's amendment, I think it will improve the bill, and I urge it be 
adopted.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Ohio (Mr. Oxley).
  The amendment was agreed to.
  The CHAIRMAN. Are there further amendments?


                 Amendment No. 8 Offered by Ms. Waters

  Ms. WATERS. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 8 offered by Ms. Waters:
       Page 7, line 15, insert ``(a) In General.--'' before 
     ``Section''.

       Page 7, after line 24, insert the following new subsection:

       (b) Specific Exceptions.--Section 624 of the Fair Credit 
     Reporting Act (15 U.S.C. 1681t) is amended by adding at the 
     end the following new subsection:
       ``(e) Specific Exceptions.--Subsections (b) and (c) shall 
     not apply to--
       ``(1) the California Financial Information Privacy Act 
     (division 1.2 of the California Financial Code, as in effect 
     after June 30, 2004); or
       ``(2) the Consumer Credit Reporting Agencies Act of 
     California (sections 1785.1 through 1785.36 of the California 
     Civil Code).''.

  Ms. WATERS. Mr. Chairman, first let me say that the gentleman from 
Ohio (Chairman Oxley) and the ranking member, the gentleman from 
Massachusetts (Mr. Frank), worked very, very hard to get a bipartisan 
bill to bring everybody together, along with the gentleman from Alabama 
(Mr. Bachus). I think everybody put their best foot forward on this 
legislation, and I am just sorry that I am not able to support the bill 
simply because I have to protect California.
  I think there was a misunderstanding somewhere along the way. I made 
lot of inquiries about whether or not post-1996 legislation or laws 
were protected in this bill. I was led to believe that they were 
protected, but now I find that they were not protected, and what we 
stand to do is literally undo or preempt much of the good consumer 
legislation that has been produced in my State. So I must object to the 
permanent preemption provisions that are proposed in this bill, the 
Fair and Accurate Credit Transaction Act.
  I believe that the States should be free to adopt more extensive 
consumer protections than those that are provided in this Fair Credit 
Reporting Act. I believe that the national standards contained in the 
Fair Credit Reporting Act should be the floor, not a ceiling, on the 
protections available to consumers. States should have the right to 
provide additional protections.
  I will ask my colleagues on both sides of the aisle, do any of you 
know what the next major consumer problem will be in the year 2010? In 
1996, when the amendment to the Fair Credit Reporting Act was 
established, identity theft was not even on the radar. We had never 
even heard of identity theft. The idea that someone would violate a 
person by stealing their identity and accessing their financial records 
was not an issue we were familiar with. Now it is the fastest growing 
consumer complaint to the FTC, with over 200,000 complaints in 2002 
alone.
  As Californians, our laws on such emerging consumer issues as 
identify theft represent the gold standard in consumer protection, and 
that is why I am asking for support on an amendment to carve out all of 
California laws enacted since the passage of 1996 amendments to the 
Fair Credit Reporting Act from preemption provisions contained in the 
bill.

[[Page 21762]]

  There has been an attempt, well, I do not know what happened, but, 
again, there was a misunderstanding, and I was misled. All of the 
consumer protections that were enacted after 1996, with the exception 
of California Civil Code 1785.25(a) regarding furnishers, are 
preemptable. So, I have a long list.
  For example, let me tell you what is preempted. Consumer reporting 
agencies must disclose the names and addresses of all sources of 
information used in Consumer Reports. That is California law, now 
preempted if this passes.
  California also requires consumer reporting agencies to, with a 
reasonable degree of certainty, match at least three categories of 
identifying information within the consumer's file with the information 
provided by a retailer. The categories of identifying information may 
include the consumer's first and last name, month and date of birth, 
driver's license number, place of employment, current residence, 
previous residence, or Social Security number. This effectively reduces 
a successful attempt at identity theft and reduces the chances for 
mistaken identity.
  Another preemption, a consumer has the right to receive his or her 
credit score, the key factors in any related information. Another 
preemption.
  A consumer would be able to have a security freeze placed on his or 
her credit report by making a request in writing by certified mail with 
a consumer credit reporting agency. A security freeze prohibits the 
consumer reporting agency from releasing the consumer's credit report 
or any information from it without the expressed authorization of the 
consumer. It would preempt it.
  Upon receipt from a victim of identity theft of a police report or 
valid investigative report, a consumer reporting agency must provide a 
victim of identity theft with up to 12 copies of their credit report 
during a consecutive 12-month period free of charge. It is very hard to 
straighten up this identity theft. Sometimes it takes 3 to 4 years. But 
if you are getting that credit report every month and you can compare 
what has been taken off, what has been left on, where the mistakes are, 
you can wind out of this thing.
  With strong consumer protections, Federal preemption of States would 
not be necessary because Federal law would be the floor, rather than 
the ceiling.
  Then, again, as all of you are aware, this past August, California 
signed into law SB1, which provides strong consumer protections that 
should be the law of the land. You are going to hear more about this in 
an amendment additional to mine that will be presented.
  But, again, let me just say that whatever the mistakes were, I should 
have been involved in the manager's amendment to correct these 
problems. I have not been placed in there. So I do not know what we are 
going to do, but I ask my colleagues to please consider what has been 
done here.
  Mr. OXLEY. Mr. Chairman, I ask unanimous consent that debate on this 
amendment and any amendments thereto be limited to 20 minutes, equally 
divided and controlled by the proponent and opponent.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Ohio?
  Mr. SHERMAN. Reserving the right to object, the gentleman's unanimous 
consent applies to this one amendment?
  Mr. OXLEY. Mr. Chairman, if the gentleman will yield, yes.
  Mr. SHERMAN. Mr. Chairman, I withdraw my reservation of objection.
  Mr. FRANK of Massachusetts. Mr. Chairman, reserving the right to 
object, because this came afterwards, what happens to the 5 minutes 
just used? Is it subsequent to the 5 minutes the gentlewoman just used?
  Mr. OXLEY. Mr. Chairman, if the gentleman will yield, that is fine 
with me.
  Mr. FRANK of Massachusetts. Mr. Chairman, I withdraw my reservation 
of objection.
  The CHAIRMAN. The unanimous consent request is that further debate on 
this amendment be limited to 20 minutes.
  Is there objection to the request of the gentleman from Ohio?
  There was no objection.
  The CHAIRMAN. The gentlewoman from California (Ms. Waters) will 
control 10 minutes and a Member in opposition will control 10 minutes.
  Mr. OXLEY. Mr. Chairman, I designate the gentleman from Alabama (Mr. 
Bachus) to control the 10 minutes on this side.
  The CHAIRMAN. The gentleman from Alabama will control the time in 
opposition.
  Ms. WATERS. Mr. Chairman, I yield 3 minutes to the gentleman from 
Massachusetts (Mr. Frank).
  Mr. FRANK of Massachusetts. Mr. Chairman, I want to acknowledge that 
the gentlewoman from California is absolutely correct. She did call to 
my attention during this discussion on this bill the potential problem 
that she learned about of a retroactive preemption. I missed it. I made 
a mistake in this case. She was correct and we should have spotted it. 
I think it is incorrect.
  I want to make clear we are talking about two separate issues here on 
the preemption. There is the preemption prospectively of what is known 
as SB1. That is not what is at issue here. There will be a second 
amendment on that.
  This has to do with laws that were passed by California subsequent to 
1996 that were not subject to preemption at the time that would now be 
retroactively preempted. I think that is a mistake.
  I should note that the gentlewoman read a list of preemptions. In 
many of the cases I acknowledge what is preemptive does provide some 
protection. In other words, it is not a case where there is a 
preemption, all protections are wiped out. In some cases, the 
protections are functionally equal. In other cases, they may be 
somewhat different. But these are laws that had been on the books in 
California. My view was that this bill ought to go forward with the 
existing preemptions, with some new consumer protections. It was not my 
intention to extend the preemptions. Through failure to spot the 
meaning of some particular words, I must concede that this happened.

                              {time}  1615

  I regret that. We have tried in conversations to undo it. We have in 
the manager's amendment undone some of it, but not enough of it. But as 
I said, there are still some of the sections preempted and are replaced 
by other protections, so it is not a case where there will be no 
protections at all; but it does seem to me still that there are some 
rollbacks of California law that were unnecessary.
  So as a matter of fairness to California, I do not think we should 
have been preempting without full knowledge.
  Now, I do not mean to say that anybody did anything inappropriate. I 
should have been clearer about what was happening and we simply failed 
to spot the meaning of four words; that sometimes happens. I support 
the gentlewoman's amendment. I think the California laws are 
substantively wise, but that is not the primary point. My primary point 
is that we should not be here retroactively preempting what a State has 
done. That is very different than the future of SB1. We will talk about 
that later.
  So I strongly support the gentlewoman's amendment; and throughout 
this process, because this bill is a long way from being sent to the 
President, I will continue to do what I can. She is correct, she and 
the other gentlewoman from California who serves on the committee 
called this to our attention, they deserved a better response than they 
got; and I will do everything I can now to correct the error that we 
made.
  Mr. BACHUS. Mr. Chairman, I rise in opposition to the amendment, and 
I yield myself such time as I may consume.
  Mr. Chairman, let me first stress that the legislation before us on 
which we are having an amendment by the gentlewoman from California 
now, and we will have one from the gentleman from Vermont which will 
follow that, I first want to say to them that there

[[Page 21763]]

are many important consumer protections in this bill: free credit 
report, fraud alerts, the one-call-does-it-all, protecting of health 
information. And I want to commend both of the gentlewomen for their 
participation in that. So I do want to say that several of their 
suggestions, several of the things that they advocated are in this 
legislation.
  To the gentlewoman from California, I rise in opposition to 
disregarding a national uniform standard in the case of, and this 
amendment covers two different acts; one of them because the act before 
us simply does not address a lot of the Gramm-Leach-Bliley things that 
this legislation did not address. I think this Congress will, at some 
point, take up a review of those things. The second one does deal with 
ID theft; it is the California legislation that was just passed.
  This legislation before us today, if it passes, Californians will 
have important new protections in ID theft cases. And I think we all, 
no matter how we feel about the gentlewoman's amendment, I hope we can 
all agree on that. We do think that this amendment really strikes at 
the essence of this bill; and that is a broad, uniform standard where 
what is done in California meets the test of what is done in Alabama, 
and what is done in Alabama meets the test of what is done in Ohio. If 
we apply different standards to fraud alerts, if we require different 
standards of credit reporting agencies or reports, there is so much 
interaction here between States. It simply drives up the expense, when 
California, representing a fourth of this Nation, can impose its own 
standards on a national issue in which, on a daily basis, millions of 
transactions are crossing State lines.
  Mr. Chairman, I reserve the balance of my time.
  Ms. WATERS. Mr. Chairman, I yield myself 1 minute to explain to the 
gentleman that this is not an imposition on the rest of the country; 
this is a carve-out for California. This is a protection for what we 
have already done. We have protections in the law from 1996; and what 
we are saying is, you should not have national standards that are less 
than what we have produced in California. I have tried to protect that. 
I thought that I had. And as our ranking member said, a mistake was 
made. We thought, based on the representations of everybody, that it 
had been protected. And now I am here with an amendment that simply 
says, leave California alone and allow the better consumer laws to 
stand in California. Do not preempt these laws with standards that are 
less than what we have in California.
  Mr. BACHUS. Mr. Chairman, will the gentlewoman yield?
  Ms. WATERS. I yield to the gentleman from Alabama.
  Mr. BACHUS. Mr. Chairman, is the gentlewoman talking about cases in 
identity theft? Is that what we are talking about?
  Ms. WATERS. No. As the ranking member tried to explain, there are two 
different issues here today.
  The CHAIRMAN. The time of the gentlewoman has expired.
  Mr. BACHUS. Mr. Chairman, I yield the gentlewoman 1 minute of my 
remaining time.
  Ms. WATERS. Mr. Chairman, there are two different issues here. When 
we did this work in committee, we thought that we had protected the 
consumer laws that were made in California after 1996; and everybody, 
all of our staff people, everybody thought so, on both sides of the 
aisle.
  Mr. BACHUS. As to identity theft?
  Ms. WATERS. No. I just read a number of them a few minutes ago in my 
presentation that had to do with some other laws, with credit reports 
and some other kinds of things.
  Mr. BACHUS. Well, the amendment deals with two specific acts.
  Ms. WATERS. Yes.
  Mr. BACHUS. One of those acts was just passed by the California 
legislature in the past few days.
  Ms. WATERS. Yes. That is the latter part. That is the latter part of 
this amendment. But the amendment that I am speaking to now is the one 
where I said consumer reporting agencies must disclose the names and 
addresses of all sources of information. California requires consumer 
reporting agencies to, with a reasonable degree of certainty, match at 
least three categories identifying information. I read a list of items 
that had been preempted that none of us thought had been preempted, and 
I am trying to carve out for California and put them back in.
  Mr. BACHUS. Mr. Chairman, how much time remains?
  The CHAIRMAN. The gentleman from Alabama (Mr. Bachus) has 6 minutes 
remaining; the gentlewoman from California (Ms. Waters) has 6 minutes 
remaining.
  Ms. WATERS. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
California (Ms. Lee).
  Ms. LEE. Mr. Chairman, first let me just say I do rise in strong 
support of the Waters amendment to protect Californians', Californians' 
mind you, financial privacy laws and identity theft provisions. I 
applaud my colleague from California for her leadership on this issue, 
for identifying a mistake that was made, and really for just trying to 
correct it in a very rational way. That is what this amendment does. It 
corrects a mistake that was made. This bill is a bipartisan bill. We 
all wanted to support it; but coming from California, the gentlewoman 
has figured out a way that we should support this, and it would be a 
win-win for all of us.
  The FTC, Mr. Chairman, reported on September 3 that 27.3 million 
Americans have been victims of identity theft in the last 5 years, 
including 9.91 million people, or 4.6 percent of the population in the 
last year alone. Now, these are epidemic levels, and we must do 
everything we can do to prevent identity theft and to help the victims 
of this horrendous crime. That is why this amendment is so important. 
It would preserve very important California laws on identity theft. 
These are California laws.
  Let us be clear. If we do not adopt the Waters amendment today, 
Californians will lose vital identity theft provisions currently 
provided in California law. Victims of identity theft will lose the 
right to a free monthly credit report. Victims of identity theft will 
lose the protection of California's law providing the right to correct 
a credit report with a police report. Victims of identity theft will 
lose the protections of California's law requiring credit bureaus to 
place a fraud alert within 5 business days of receipt of a request from 
the consumer. And the list continues. In total, seven existing 
California laws would be wiped out by this bill and another four will 
probably be eliminated. It really simply defies logic to kill these 
existing California protections for the victims of identity theft when 
we are facing a growing identity theft crisis in our State.
  Again, I thank the gentlewoman for her leadership. I thank her for 
offering this fix to this very important bill, and I hope that we all 
can support this correction of a major error that was made.
  Mr. BACHUS. Mr. Chairman, I yield myself such time as I may consume.
  What this amendment does, first of all, it addresses two things; one 
is SB1 that was just passed in California. And as to affiliate-sharing, 
that is what is preempted by this legislation. But the present 
preemption, what we are doing is, we are taking a preemption that 
presently exists in the law and we are extending it as of January 1. So 
SB1 as to affiliate-sharing, you cannot do that today in California. 
You would be, if FCRA was not renewed.
  Now, the second component that you have here is California's version 
of FCRA. And what that would do, the Waters amendment would not only 
allow California to change its law on an ongoing basis, but beyond what 
we grandfathered today, and we are grandfathering some of those 
protections, but it would also resurrect certain laws that are 
preempted today.
  Now, as to a uniform standard, and I want to go back to what we posed 
to Treasury and what their response was in testimony before our 
committee, why should uniform national standards be extended to include 
matters that are designed to help fight identity theft? Why should not 
States be able to adopt stricter anti-ID theft measures?
  Now, since that time, in the manager's amendment, we have allowed a 
lot of those as long as they do not affect the operation of the FCRA, 
and

[[Page 21764]]

the answer that we got from the Federal Reserve, from the Treasury, 
from the FTC was that it would literally cost millions of dollars; that 
it is important to have national uniform standards for identity theft 
prevention measures.
  For example, section 202 of the act calls for the development of a 
national fraud alert system. This requires the credit reporting 
agencies that operate on a nationwide basis to allow consumers to place 
various types of alerts in their credit reports when they are victims 
of identity theft. Now, we require certain things to go into those 
alerts. If California requires other things, then a company doing 
business in Ohio or Alabama or New York would not only have to comply 
with that law, they would have to comply with the California law if 
they had customers or consumers in California. Merchants dealing with 
California consumers would not only have to comply with the national 
law, they would have to worry about the law in all 50 other States with 
credit reports.

                              {time}  1630

  We would have a gradual erosion and chipping away of our national 
system. And we took volumes and volumes of testimony how the person 
most penalized by this would be the consumers in paying higher interest 
rates, also in being a less effective national standard. We would also 
discourage people from using the National Uniform Credit System to 
report and to furnish information if they thought they not only had to 
comply with a national law but a California law.
  Finally, philosophically, when California is able to basically define 
what FCRA will be, then California imposes its will on the national 
policy. And we have to have a national policy. We have representatives 
of California here. In fact, probably one-fifth of this body is made up 
of California representatives, or one-sixth. They participated in this.
  I anticipate that when this final vote is taken, the vast majority, 
as in committee, of Californians will vote for this legislation. But we 
simply cannot allow any State to dictate how this system will operate 
in Alabama, Ohio, New York or to impose additional requirements and 
costs on consumers in California or Massachusetts or other States. 
Simply put, this amendment, it sounds good but it strikes at the very 
efficiency, the cost efficiency, of our national credit reporting 
system. It bogs it down.
  I will conclude with this: California recognized this when they 
preempted the law of several large cities in California who had 
attempted to impose their own standards simply by saying we cannot. The 
cost of cities and counties imposing their own standard would be 
prohibited. California ought to see that that logic also applies on a 
national level.
  Governor Davis, I believe, initially bought into this. Initially when 
this legislation, some of this legislation was proposed, he did not 
sign it. He did not support it. He is now facing a recall in a few 
weeks, but I am not sure that is the time to judge what ought to be 
done in the middle of a politically expedient campaign.
  Mr. Chairman, I reserve the balance of my time.
  Ms. WATERS. Mr. Chairman, how much time is remaining?
  The CHAIRMAN. The gentlewoman from California (Ms. Waters) has 4 
minutes remaining. The gentleman from Alabama's (Mr. Bachus) time has 
expired.
  Ms. WATERS. Mr. Chairman, I yield 2 minutes to the gentleman from 
Vermont (Mr. Sanders).
  Mr. SANDERS. Mr. Chairman, I thank the gentlewoman for yielding me 
time.
  California may have one-sixth of the Members in this body, Vermont 
does not. I am it and I rise in strong support of the Waters amendment.
  The issue of preemption was hotly debated in the Committee on 
Financial Services, and on one side of that issue was virtually every 
consumer organization in America. Groups like the Consumer Federation 
of America, the U.S. Public Interest Research Group, Consumers Union, 
and many others. And some of us in the committee supported these 
consumer organizations, making the point that the gentlewoman from 
California (Ms. Waters) just made. That in the nature of our 
government, we are the United States of America, there are 50 States in 
our country. And sometimes one State does something really good and a 
whole lot of other States learn from that State. And that is one of the 
reasons that we have a creative form of government with a lot of ideas 
that are flowing.
  On the other side of that debate, of course, were the credit card 
companies and the banks. And let us be clear, they do not want strong 
consumer protection. They are the people who are charging individuals 
in this country 25 percent interest rates on their credit cards. They 
do not want to see governors and legislatures and attorneys general 
stand up strongly and protect consumers. So what ends up happening is 
that we have a national bill which has admittedly some good provisions 
in it, but at the same time, it takes away the ability of 50 States to 
go further.
  So the gentlewoman from California (Ms. Waters), the gentlewoman from 
California (Ms. Lee), and I and many others were fighting for higher 
Federal standards, more consumer protection, but at the same time, give 
California the right to go forward.
  It is inconvenient. Well, democracy is inconvenient. Alabama does 
some things. Vermont does some things. We live together. We learn from 
each other. We argue with each other, but we do not take away, we 
should not take away the rights of the States to go further. I support 
this amendment.
  Mr. Chairman, I support the amendment offered by Congresswoman 
Waters. This amendment would simply allow the 7 Fair Credit Reporting 
Act preemptions to expire, as Congress intended, on January 1, 2004 in 
order to allow the 50 states of this country to pass stronger consumer 
protection laws to improve the accuracy of credit reports and to 
aggressively fight identity theft.
  I should note right off the bat that every major national consumer 
group in this country including the Consumer Federation of America, the 
U.S. Public Interest Research Group, Consumers Union, and the National 
Consumer Law Center all vigorously oppose state pre-emption. I would 
also like to tell you that the National Association of Attorneys 
General, representing all 50 States of this country, unanimously passed 
a resolution opposing the 7 FCRA state preemptions.
  Mr. Chairman, you know my views on this subject. If my State of 
Vermont or your State of Ohio wants to pass laws that are stronger than 
the Federal Government's, we should give States that right. The States 
are the laboratories of Democracy. You know what happens here. If there 
is a particular identity theft crisis in Colorado and the Colorado 
State Legislature passes a law to correct this problem, and it works, 
what happens? Pretty soon, California may pass the same law. Then 
Nebraska. Then Maryland. And, eventually it filters up to the federal 
government and we have a good national law on the books. But, if this 
legislation is signed into law, we would permanently prevent the States 
from taking this action. We hear a lot of talk from conservatives about 
protecting the States and the American people against the big, bad and 
instrusive Federal Government. Well, call me a conservative on this 
issue because I believe that the 50 States in this country should be 
able to pass their own laws and should not be pre-empted by the Federal 
Government from passing stronger laws that protect consumers. So, I 
would say to my conservative friends on the other side of the aisle, 
vote for my amendment. It is consistent with your philosophy on the 
role of the government.
  And to my Democratic friends on this side of the aisle, I ask all of 
you to vote for this amendment as well. Let us not forget that just 
last week, during a recent mark-up of the Securities Fraud Deterrence 
and Investor Restitution Act (H.R. 2179) in the Capital Markets 
Subcommittee, virtually every Democrat voted against preempting the 
states from taking strong enforcement actions against Wall Street firms 
that defraud investors. I agree. The 50 States of this country should 
not be prohibited from aggressively punishing corporate wrongdoing.
  Today, we are dealing with the exact same issue: state preemption. 
But, this time it deals with consumer protection. Just like we should 
not prohibit States from aggressively punishing corporate wrongdoers, 
to my mind, we should

[[Page 21765]]

also not permanently bar the states from aggressively punishing 
identity thieves and improving the accuracy of consumers' credit 
reports. Therefore, I hope my Democratic friends will vote for this 
amendment as well.
  Mr. Chairman, as we all know, the newspapers are filled with horror 
stories about the harm being done to consumers by identity thieves. 
This problem is compounded by the shabby job done by the credit 
reporting system in ensuring that consumers' credit reports are 
accurate and up-to-date. States have been at the forefront of the 
effort to stop identity thieves and to clean up the credit reporting 
industry. The federal government should be a partner in that effort but 
should not pull the rug out from under the states. There is no greater 
impediment to consumer credit than a credit report full of errors. 
There is no reason to tie the states' hands.
  We have heard from the financial services industry and the major 
credit bureaus that if we don't extend these state preemptions, the 
entire credit system will collapse. But, let us not forget, we had a 
national credit system before the 1996 state preemptions were inserted, 
and it worked well. For example, one of the witnesses that we heard 
from on this issue from Juniper Bank who supports preemption cited a 
study that showed ``in 1990, more than 70 percent of credit card 
balances were being charged more than an 18 percent annual interest 
rate. By 1993, only 34 percent of credit card balances were being 
charged more than 18 percent interest.''
  Great study. All of the benefits to consumers just happened to be 3 
years before the 1996 preemptions were enacted.
  Another supporter of state preemption who testified at our first 
hearing from the Information Policy Institute pointed to another study 
that showed that credit card prices ``declined by almost 35 percent 
between the first quarter of 1984, and the fourth quarter of 1996,'' 
saving consumers ``about $30 billion per year.''
  Again, great study. All of the benefits to consumers happended to 
occur before the 1996 state preemptions were enacted.
  In addition, the 1996 FCRA amendments specifically grandfathered 
stronger consumer protection statutes in California, Massachusetts and 
Vermont from pre-emption. What have we seen in these 3 states that have 
stronger consumer protection laws in regards to credit reporting? We 
have seen that my State of Vermont now has the lowest rate of consumer 
bankruptcies in this country; the State of Massachusetts has the second 
lowest consumer bankruptcies in the United States; and California comes 
in ahead of the median. At a time when the United States as a whole 
experienced the highest rate of bankruptcy cases in history, increasing 
by 23 percent since 2000, I would say that these three examples gives 
us proof that stronger State consumer protection laws work.
  What about mortgage rates? Well, the most recent data indicate that 
the State of California has the lowest effective rate for a 
conventional mortgage in the nation, and Vermont and Massachusetts were 
well below the median. Sounds pretty good to me.
  In addition, let us not forget why the 1996 FCRA amendments were 
enacted. While identity theft complaints have been the number one 
complaint to the FTC each year since 2000, and in fact doubled from 
2001 to 2002, it was credit bureau mistakes which were the number one 
complaint to the FTC 10 years earlier. And it was credit bureau 
mistakes, and complaints about them, that led Congress to the 1996 FCRA 
amendments. From 1990-92, according to a study by U.S. PIRG, mistakes 
in credit reports were the number one complaint to the FTC. What will 
the new crisis be? We don't know for sure. But, if we permanently 
preempt the States from acting on future problems, we will do this 
country a great disservice.
  Moreover, if some of the new members don't believe Congress intended 
these preemptions to sunset, I would refer them to the floor statement 
of the former Ranking Member of the Banking Committee and former 
Republican Congressman from California Al McCandless who had this to 
say during the floor debate on this bill:
  ``The issue over whether the Fair Credit Reporting Act should preempt 
more stringent State laws or whether it should permit States to enact 
tougher credit reporting statutes has been one of the single toughest 
issues for the Banking Committee to tackle. On the one hand, many of 
our Members like the idea of a national uniform standard. On the other, 
we do not want to tie the hands of State legislatures. I think that 
this compromise bill resolves the issue of preemption to most 
everyone's satisfaction. The Fair Credit Reporting Act as amended by 
this compromise bill, will be the law of the land for the next 8 years. 
It will provide consumers across the country with greater protection 
than is currently offered by any existing State statute. A uniform 
national standard will make compliance more straightforward and will 
facilitate the extension of credit to consumers. States will be able to 
enact more stringent legislation if necessary after 8 years.''
  Let me repeat, ``States will be able to enact more stringent 
legislation if necessary after 8 years.''
  That's what was said by the top Republican on the Banking Committee 
on the floor of the House when a compromise was reached on this bill. 
Let's stick to that compromise and support this amendment.
  Ms. WATERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I think I made the case as clearly as it can be made. I 
was told by everybody that certain California laws after 1996 were 
protected. Now I find that they have been preempted. And I really do 
not think it is fair that I find myself here on the floor today having 
the laws of my State preempted and a manager's amendment that does not 
attempt to correct it.
  I suppose I believe that my ranking member is going to do everything 
he can, I guess working in conference somewhere, to try and give back 
the protections that we have in California. I have always maintained 
that the Federal standard should be the floor. If any State would like 
to protect its consumers more, who is the Federal Government to tell 
them they cannot do it? That is wrong.
  I do not buy the argument that it is inconvenient for some bank or 
financial institution to have to deal with California, because 
California has better consumer laws, and they would just rather be able 
to deal with them the same way that they deal with everybody else.
  I do not think it is fair, and I do not think we should use the 
powers of our government to do that.
  Let me just say this, that knowing that I was today that we were not 
preempted, and this does not have anything to do with SB1, I am talking 
about those laws that I referred to. Knowing that I was told that, I 
would expect my colleagues, who have worked pretty well on both sides 
of the aisle, to try and get a bill that everybody could support, that 
you would at least represent to me that you are going to try and undo 
the mistake. That you are going to try.
  Mr. BACHUS. Mr. Chairman, will the gentlewoman yield?
  Ms. WATERS. I yield to the gentleman from Alabama.
  Mr. BACHUS. I will say this: Yes, there are provisions of California 
law that were preempted, but they are provision where we established a 
consumer protection on a national basis. And in almost every one of 
these cases, we went beyond what most States do.
  Ms. WATERS. Reclaiming my time, we have to compare it issue-by-issue 
and then determine whether or not, in fact, you have done better or you 
have done worse.
  The CHAIRMAN. All time for debate on the amendment offered by the 
gentlewoman from California (Ms. Waters) has expired.
  The question is on the amendment offered by the gentlewoman from 
California (Ms. Waters).
  The amendment was rejected.
  The CHAIRMAN. Are there any further amendments?
  Mr. OXLEY. Mr. Chairman, I ask unanimous consent that debate on the 
following amendments, and any amendments thereto, be limited to the 
time specified equally divided and controlled by the proponent and 
opponent as follows:
  The amendments numbered 2, 5, 7, 9, and 10 in the Congressional 
Record shall be debatable for 10 minutes;
  The amendments numbered 1, 6, 11, 12, and 16 in the Congressional 
Record shall be debatable for 20 minutes;
  And the amendments numbered 15 and 4 in the Congressional Record 
shall be debatable for 30 minutes.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Ohio?
  Mr. SHERMAN. Reserving the right to object, Mr. Chairman, I thought 
that the Lee-Sherman amendment was getting 40 minutes equally divided. 
I could be wrong on that. What was the agreement?

[[Page 21766]]


  Mr. OXLEY. Thirty minutes, Mr. Chairman.
  Mr. SHERMAN. Mr. Chairman, would the gentleman mind having the Lee-
Sherman amendment given 40 minutes?
  Mr. OXLEY. What number is that?
  Mr. SHERMAN. Number 15.
  Mr. OXLEY. Number 15? I would give it 35 minutes. How is that for a 
compromise?
  Mr. SHERMAN. That is a wonderful idea, Mr. Chairman.
  Mr. OXLEY. Mr. Chairman, I amend my unanimous consent request to make 
the amendment number 15 debatable for 35 minutes.
  The CHAIRMAN. Is there objection to the request with the addition 
that amendment number 15 be debatable for 35 minutes equally divided?
  There was no objection.
  The CHAIRMAN. Are there further amendments?


                  Amendment No. 15 Offered by Ms. Lee

  Ms. LEE. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 15 offered by Ms. Lee:
       
       Page 7, after line 24, insert the following new section:

     SEC. 102. FINANCIAL PRIVACY EXCEPTIONS.

       Section 624 of the Fair Credit Reporting Act (15 U.S.C. 
     1681t) is amended by adding at the end the following new 
     subsection:
       ``(e) Financial Privacy Exceptions.--Subsections (b) and 
     (c) shall not apply to the California Financial Information 
     Privacy Act (division 1.2 of the California Financial Code, 
     as in effect after June 30, 2004) or the law of any other 
     State that is similar to the California Financial Information 
     Privacy Act.''.

  The CHAIRMAN. The gentlewoman from California (Ms. Lee) will be 
recognized for 17\1/2\ minutes and a Member opposed will be recognized 
for 17\1/2\ minutes.
  The Chair recognizes the gentlwoman from California (Ms. Lee).
  Ms. LEE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, first, let me thank the gentleman from Ohio (Mr. Oxley) 
and the ranking member, the gentleman from Massachusetts (Mr. Frank) 
for their diligent work to really make this a bipartisan bill. Of 
course, I cannot support it as long as it preempts California and that 
is what it does.
  I offer this amendment today on behalf of all Californians and all 
Americans, really, who deserve and want to take back control of their 
private financial information. And I want to thank my California 
colleague, the gentleman from California (Mr. Sherman), the gentleman 
from California (Mr. Farr), the gentlewoman from California (Ms. 
Waters), the gentlewoman from Illinois (Ms. Scha-
kowsky), the gentleman from Massachusetts (Mr. Markey), and all of 
those who have been working on this very, very important issue and this 
important amendment.
  Mr. Chairman, our amendment would make a major step towards 
reclaiming consumers' financial privacy by doing the following: First, 
it protects California's recently enacted landmark Privacy Act; and, 
secondly, it allows every State to enact financial privacy laws giving 
consumers in those States similar protections to Californians, which, 
of course, is the strongest in the Nation, if they so choose, only if 
they so choose. For those of you who are not fortunate enough to hail 
from the great State of California and may not be familiar with 
California's new law, let me just provide a little bit of background.
  What does the new privacy law do? It gives consumers the right to 
stop the sharing of information by financial institutions, unless they 
meet very stringent criteria. The law requires financial institutions 
to obtain a consumer's affirmative consent before sharing information 
with most third parties. It also provides standards for consumers to 
receive clear notice of their rights.
  Now, how did this groundbreaking law come about? Well, it was the 
result of a long hard fight and it is a major effort by California 
State Senators, Jackie Speier and John Burton. And I really want to 
thank them for their tireless effort in working with the financial 
institutions in California to come up with this arrangement, this 
compromise, this law which really did result in resounding bipartisan 
support for the bill SB1, which passed the California Senate by a vote 
of 31 to 6 and passed the assembly by a vote of 76 to 1.
  Yes, I also want to thank Governor Davis for really standing up for 
California consumers by signing this bill. But it is very important, I 
believe, to recognize the critical role California consumers played in 
the fight for new and strong financial protections because in the end 
it was this broad support and the very hard work of California 
consumers that pushed the bill forward.
  In fact, I want to cite a January California opinion poll to 
demonstrate the overwhelming popularity for a strong financial 
protection. Now, the poll found that 91 percent of individuals 
supported a ballot initiative that will require a bank, credit card 
company, insurance company or other financial institutions to notify a 
consumer and to receive a customer's permission before selling any 
financial information to any separate financial or nonfinancial 
company. The support was strong regardless of party affiliation: 96 
percent of Democrats, 88 percent of Republicans, 90 percent of 
Independents. Clearly, financial privacy is not a partisan issue.
  Now these groundbreaking, popular, hard-won protections which were 
negotiated with our financial institutions in California are threatened 
because of this bill before us today. Let us be clear, this bill does 
preempt California law. And what does that mean? That means that 
important California protections will just basically be wiped out. In 
fact, it means that Californians will never see parts of the law that 
was signed by the governor. And it means that the will of an 
overwhelming majority of Californians will be overturned by what we are 
doing today.
  We cannot allow that to happen. We have an obligation to stop that 
and this amendment would do exactly that. And just like we have an 
obligation to stand up for all of our consumers today, we are standing 
up for our California consumers. We have an obligation to stand up for 
consumers, as I said, all across the country so that they have the 
opportunity to protect and to control their intimate financial details.

                              {time}  1645

  Consumers in California are no different than consumers everywhere 
when it comes to their financial privacy. Strong protections are what 
they seek and what they deserve.
  I want to take a moment to address some of the inflated and really 
irrational concerns that have been raised about our amendment. It will 
not bring commerce to a grinding halt. It will not mean an end to 
affordable mortgages, and it will not leave more minorities without 
access to credit. It will not put an end to ATM machines, and it will 
not ruin the credit system as we know it.
  It will merely require banks and insurance companies and other 
financial institutions to ask California consumers before they share 
and sell their private information. It will merely allow consumers and 
other States to benefit from similar protections in the future if they 
determine that it makes sense for them.
  Mr. Chairman, I reserve the balance of my time.
  The CHAIRMAN. Does the gentleman from Ohio (Mr. Oxley) claim the time 
in opposition?
  Mr. OXLEY. Yes, Mr. Chairman.
  The CHAIRMAN. The gentleman from Ohio (Mr. Oxley) is recognized.
  Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I rise in opposition to the amendment and this really 
strikes at the heart of what we are trying to do in this legislation to 
provide national uniformity of our credit system. The Lee amendment 
would destroy the national uniformity with respect of the ability of 
the financial institutions and others to share information among 
affiliated entities.
  The Lee amendment does not affect only Californians. Would that be 
the case, I would not be as particularly

[[Page 21767]]

concerned, but by grandfathering the California law with respect to 
affiliate sharing, the Congress would actually abdicate its obligations 
by allowing California to set the national standard with respect to 
affiliate sharing. I suggest to my colleagues that that is the 
responsibility of the national legislature, indeed the Congress.
  In essence, many financial institutions will not be able to adhere to 
multiple sets of rules with respect to affiliate sharing. Then what 
happens? Some or many will simply adopt the California requirements as 
the national standard, and ultimately, it becomes California setting 
national standards, and while I have a great deal of respect for my 
colleagues from California and the Golden State, I do not think it is a 
responsible position for the Congress to abdicate that responsibility 
to the Golden State.
  So the question is not necessarily whether there will be a national 
standard but, in fact, who will set it, and ultimately, the 
Constitution provides the ability of the Congress to set those national 
standards.
  The Lee amendment also would allow any other State to adopt its own 
laws with respect to affiliate sharing. Therefore, financial 
institutions and consumers could find themselves attempting to 
understand dozens of State laws pertaining to affiliate sharing. The 
actions dealing with privacy in California should not impact the 
Federal debate on FCRA, and this is important to understand. The 
affiliate sharing provisions in the California law are preempted by the 
existing provisions of FCRA today. So they will be essentially null and 
void whether Congress reauthorizes the FCRA or whether it does not.
  The understanding among all parties in California was that the 
affiliate sharing provisions would be invalidated under the existing 
FCRA national standard. The negotiations on the California law and the 
shift of several companies positions in opposition to neutral was based 
on opposition to a State-wide referendum and was part of the 
negotiations that went on in the California legislature. That is not 
unusual in today's making of laws in any particular State.
  In short, grandfathering California law and future laws in other 
States guts our national uniform standards and harms consumers across 
the country, could cause an increase in interest rates, inability to 
get credit, precisely the opposite of what we are trying to do in this 
legislation. That is why this legislation passed 61 to 3 in the 
Committee on Financial Services. That is why we have a broad base of 
support for this legislation across the aisle, among all sections of 
the country, why we have had strong leadership from both sides of the 
aisle on this important legislation.
  We do not need at this point to get in a situation where we have a 
rush by other States to simply gut our national standards. That is not 
what we are about in this body, and all of us who have supported this 
legislation, who probably cosponsored and voted for it in committee and 
sent letters, Dear Colleagues, out supporting this legislation need to 
understand that this is a killer amendment to what we are trying to do 
in the underlying legislation, and that is why this amendment should be 
defeated.
  Mr. Chairman, I reserve the balance of my time.
  Ms. LEE. Mr. Chairman, I yield 5 minutes to the gentleman from 
southern California (Mr. Sherman), cosponsor of this amendment.
  Mr. SHERMAN. Mr. Chairman, I thank the chairman for arranging an 
extra 5 minutes to debate this important amendment. It is our intention 
to offer it, and then withdraw it at the end of this discussion, in the 
hopes that these issues can be dealt with effectively in conference. By 
withdrawing the amendment at the end of this discussion, we will save 
the House at least 30 minutes as compared to a recorded vote, thus 
giving my colleague a six-time return on his investment.
  This is a good and necessary bill. We have an amazing credit system 
in this country where a bank on the east coast will compete for the 
opportunity to lend money to somebody on the west coast who they have 
never met; even when none of the banks' employees knows anyone who 
knows the borrower. Imagine that compared to where we were in this 
country 100 years ago, when it took a personal relationship with a 
banker to get a loan. This is an amazing system, and it can exist only 
with national credit reporting that borrowers and lenders can rely upon 
and only with a national system that regulates that national credit 
reporting.
  But in our effort to have national standards, which our friends on 
the other side of the aisle have explained the importance of, we should 
not reach the lowest common denominator. Instead, we need to look at 
what the States have done to protect their consumers and try to have a 
national standard that is at least as high, or at least addresses each 
of the different consumer protection issues. So, this bill needs to be 
compared to California law to see whether it achieves that, or whether 
it might achieve it at the end of the conference.
  There are two sets of consumer protections in California law. The 
first is known as the pre-SB1, pre-Speier's bill protections. In this 
area, we from California had been told that none of the California pre-
SB1 protections would be preempted. But in fact, they were. However, 
the violence done by that preemption is perhaps not as great as some of 
my colleagues have pointed out because in many of the cases where 
California law was preempted, it was replaced by a national standard 
that was just as good for consumers, even if slightly different in 
form.
  For example, there is the California requirement that consumer 
reporting agencies must disclose the names and addresses of all sources 
of information in the consumer report. That California law is preempted 
but replaced with an even stronger Federal law that not only requires 
that, but, (I thank the chairman for accepting my amendment in 
committee), also requires that the phone numbers, as well as the 
addresses, of those who provide that consumer information be provided 
in the consumer report.
  So it is important that in conference, we take a look at all the pre-
SB1 California provisions, make sure that whatever protections a 
Federal law preempts, are replaced by equally strong consumer 
protections.
  In a few areas that is not the case, and I am confident that in 
conference, with the advocacy of our ranking member, the gentleman from 
Massachusetts (Mr. Frank) and with the chairman of the committee, we 
will achieve that.
  The second set of California Consuming Protections were given to us 
by SB1, the Speier's bill, which was passed while this Congress was in 
recess last month. There are several provisions of that bill that are 
not preempted by Federal law and that will do an outstanding job of 
protecting Californians, and I commend them to our committee and to the 
State legislatures around the country. One of those (SBI) provisions, 
however, would be preempted. That is what is called the opt-out 
provision dealing with affiliate information sharing.
  We are talking about a situation where a person goes to a bank, 
provides the bank with their financial information, are the bank shares 
it with their affiliated insurance company or their affiliated stock 
brokerage company? Good business practice, as well as California law, 
allows a consumer to instruct their financial institution not to share 
their information with an affiliated company. I think that is smart 
business. I commend Jackie Speier of California for writing it into 
California law.
  As we go to conference, hopefully this issue will be addressed. One 
way to address it is the way Bank of America already addresses it 
voluntarily, and this would be a compromise. That is to say, that a 
consumer should be able to opt-out for purposes of marketing. The 
consumer would be able to say, Bank, do not have your insurance company 
call me. If we were able to get that, yes, California consumers might 
lose a tiny bit, but 280 million Americans would gain substantially.

[[Page 21768]]

  I look forward to a conference that will assure consumers around this 
country, and those of California, with enhaused protections.
  Mr. OXLEY. Mr. Chairman, may I inquire as to the time left?
  The CHAIRMAN. The gentleman from Ohio (Mr. Oxley) has 13 minutes 
remaining. The gentlewoman from California (Ms. Lee) has 7 minutes 
remaining.
  Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Chairman, Members are back in their office and they 
are listening to this debate, and one of the things that they may or 
may not have heard, but if they did, is that both gentlewomen from 
California may have been misled on this legislation into thinking that 
nothing in this law preempted California.
  I, in fact, went back to the debate at the time that the gentlewoman 
from California (Ms. Waters) offered a similar amendment to what is 
being offered on the floor today, and I want to read to her just by way 
of refreshing our memory, not to dispute what she says, and quote what 
she said.
  She said, ``I, in good faith, would not like to preempt the work of 
the State of California, the legislators who have spent so much time. 
Nor would I like to be on record preempting them with supporting this 
legislation, when I know that we are going to have a ballot measure 
that is going to be passed. The people of the State of California are 
going to pass this ballot measure that will give them further 
protections. I do not believe that a ballot measure should be preempted 
here at the national level.''
  She offered this amendment. It was defeated 56 to 6, and then as the 
legislation passed out of the full committee, the gentlewoman from 
California (Ms. Lee) and the gentlewoman from California (Ms. Waters) 
joined the gentleman from Vermont (Mr. Sanders) and voted against the 
whole thing because, in fact, it did preempt something in California. 
What is it that it preempts?
  The legislation that California just passed did three things. Number 
one, it required opt-in for third party nonaffiliate sharing. Nothing 
in this legislation changes that. It had new Gramm-Leach-Bliley privacy 
notices. Nothing in this legislation affects that. There is only one 
thing and one thing alone that this legislation ``preempts'' 
California, and that is the required opt-out for affiliate sharing, and 
that is also the present law. So what was passed in California, as far 
as the required opt-out for affiliate sharing, the citizens of 
California did not get anything because the national law today preempts 
that. It had no effect.
  If our national standards expire January 1, yes, they would, but as 
the gentleman from Ohio (Mr. Oxley) said, Gramm-Leach-Bliley, we are 
going to address that next year and look at those affiliate sharing 
things. In fact, the chairman of the committee in the Senate says he is 
going to look at them, and I think that he probably will. We may 
address them in conference, but we did not open up that debate. We did 
not address it with our hearing.
  Ms. LEE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Monterey, California (Mr. Farr), a real advocate for consumers, a great 
leader.
  Mr. FARR. Mr. Chairman, I thank the gentlewoman for yielding me the 
time.
  I rise in strong support of the Lee-Sherman amendment No. 15, which 
protects the right of States to defend the privacy of their citizens. 
As written, this bill would preemptively cancel out the effects of 
California's SB1. I know it has been mentioned but remember, 
California, one, is the leading financial State in the United States 
and has the most number of consumers in the United States, and that 
bill passed after an incredibly long debate in the legislature, and it 
was supported by or went neutral by financial institutions who were 
affected by it, had overwhelming consumer support and was voted out of 
both Houses on a bipartisan fashion.

                              {time}  1700

  So do not take the actions of California lightly. It is a Big 
Business State, and it did a very remarkable thing by passing this 
bill. What Members should do now is preempt it. It preempts SB1 but 
also will nullify a number of existing identity theft laws.
  The Credit Reporting Act states that it is a ceiling rather than a 
floor. I think if you look at what we have done in other legislation in 
this country where we set the floor in the areas of medical privacy, 
wire tapping, cable records, video rental record, telemarketing, 
financial records, and drivers records, Federal law allows the States 
to provide stronger protections. Why not here?
  The Gramm-Leach-Bliley Act explicitly provides for States to enact 
laws for greater protection for the privacy of personal financial 
information. If you believe in States' rights and the ability of States 
to set standards to protect consumers, to protect Americans and their 
families, then I urge my colleagues to vote ``yes'' on this very 
important amendment.
  Do not take the actions of California so lightly. It is a very 
important, remarkable historical act that has been created there; and 
we ought to allow California to proceed with it.
  Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Delaware (Mr. Castle).
  Mr. CASTLE. Mr. Chairman, I just think we really need to go back 
historically in this discussion and take a look at what we were dealing 
with. I actually hate to say it, but I remember what it was like back 
before we dealt with uniform standards on credit back when we first 
started this in 1970. Then in 1996 we went to pure uniformity.
  I remember trying to get credit and being told you are going to have 
to wait for a while before we can do that. I was not the only consumer. 
Probably 100 percent of Americans or probably 98 or 99 percent were 
being told they had to wait in order to establish whatever the credit 
was. Every place you went it was handled separately or differently or 
whatever.
  Congress did something right. Congress did something extraordinarily 
right when they passed the act initially and then went to the uniform 
standards with the usurpation of some of the State laws in 1996. I 
think that is one thing we simply do not want to back off of. 
Regardless of what is in the California statute, California is the most 
significant State we have in terms of people and in terms of financial 
interests, but the bottom line is that to impose the California 
standards basically on this country could be a problem.
  I might also note another reason to vote against this amendment to 
this legislation is that it states at the end of it: ``or the law of 
any other State that is similar to the California Financial Information 
Privacy Act.'' That is a damaging statement because I don't know how 
you measure ``similar to.''
  Other States could come in and try to do something that would upset 
the uniformity of what we are doing at the Federal Government level.
  What we have done now here in Washington is given every single 
consumer in this country the opportunity to have a uniform plan so that 
we know how to get information right away. And with the use of 
technology that can be done. You can buy a car instantaneously, much 
less establish credit of a lesser nature some place else.
  I think California's attempt to impose restrictions in an area that 
is completely, totally governed by the FCRA's uniform national 
standards would be a tremendous error.
  We had extensive hearings. I think we need to remember that, too, as 
we make our decision on how to vote on this amendment. We had over 100 
witnesses in very expensive hearings. The chairman and the subcommittee 
chairman did a wonderful job working with the majority party and our 
own majority party in terms of developing this legislation.
  It did pass overwhelmingly in our committee as everybody understood 
exactly what we are dealing with. In fact, at that committee another 
member from California offered an amendment to sunset FCRA's uniform 
national standards at the end of this

[[Page 21769]]

year. And during that debate, a specific appeal to give California the 
ability to establish its own standards either through action by the 
State legislature or statewide ballot initiative came up. That 
amendment was defeated 56 to 6.
  So, clearly, the individuals in this body who have looked at this 
issue carefully understand that to undermine it by allowing States to 
start to opt out and to have different provisions with respect to the 
fair credit reporting that we have in the country would be an error.
  I would encourage everybody in this body to look at this carefully 
and to vote ``no'' on this amendment to make sure that we protect a 
very good piece of legislation.
  Ms. LEE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Massachusetts (Mr. Markey), a real leader in this Congress in the fight 
for privacy rights.
  Mr. MARKEY. Mr. Chairman, if the line of juris prudence that we are 
now operating under is allowed to stand, then we are in a situation in 
which there is no effective regulation of a bank, an insurance company, 
or a securities firm sharing of a consumer's personal financial 
information and no State regulation of such transactions.
  In other words, we are left with a regulatory black hole in which 
neither the Federal Government nor the States are regulating what is 
going on within this affiliate structure where one part of a firm gets 
it and then shares it with all of its affiliates, stockbrokers, 
insurance, you name it. All of the family's secrets are then spread 
throughout the country and to anyone that is affiliated with them as an 
independent operator as well.
  This is unacceptable. And it means we have no Federal standard for 
consumer consent regarding affiliate sharing and preemption of any 
State law dealing with the subject.
  What the Lee amendment says is that we should close this black hole 
so that if the Federal Government is unwilling or unable to effectively 
address affiliate sharing, sharing it with all the companies which this 
bank or insurance company or stock brokerage has, taking all their 
secrets and starting to share it with all these other companies, then 
the States can do so.
  This amendment preserves not only California's privacy statute but 
the laws of any other State that might want to give their people 
protection so that their family's secrets are not made a product sold 
to anyone with enough money to buy what it is that you are doing with 
your financial life, your stock brokerage, your insurance information.
  This is an important issue that our country faces: the privacy of 
every American. It is why we fought the American Revolution.
  Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume, 
as I feel compelled to respond to my good friend from Massachusetts in 
his somewhat overheated rhetoric regarding the revolution, which I know 
started in his district. And I am also sorry that we did not hear the 
famous story about his local banker, Mr. Wentworth. I am sure the other 
Members, who were not on the committee, have not had an opportunity to 
hear about it. I also am concerned that the gentleman was unable to 
hear 100 witnesses in eight separate hearings chaired by our good 
friend, the gentleman from Alabama.
  Regulatory black hole? I would invite my good friend from 
Massachusetts to read this piece of legislation. This is the strongest 
piece of privacy legislation I would say ever passed, certainly in 
recent Congresses. That is why we had 61 members of our committee vote 
for the final product when it came to the final vote.
  So I would say to my good friend, this really is crunch time as far 
as whether we are going to have a uniform standard that can protect 
consumers, can set out the rights that they have to protect their 
privacy, to protect their ability to fight off the horrible crime of 
identity theft, which affects 10 million Americans. That is what this 
bill is all about.
  And we are dedicated to this national standard that has had so much 
success since the 1996 act. My friend from Delaware points it out so 
well, of the progress that we have made. We simply cannot allow 
ourselves to slip back and allow for States to start to move the goal 
post and to essentially lower those standards so that we end up with 
the system that we had before 1996, which would result in higher 
interest rates, less access to credit, and longer waits for credit. We 
do not want to go back to the bad old days; we want to move forward. 
And so I would suggest to the Members that that is what this bill is 
all about.
  So, Mr. Chairman, I have great respect for my friend from 
Massachusetts, and am actually going to yield some of my time to him, 
since I miss him so much.
  Mr. BACHUS. Mr. Chairman, will the gentleman yield for just a moment, 
before he yields to the gentleman from Massachusetts, because I think 
it probably has something to do with it.
  Mr. OXLEY. I yield to the gentleman from Alabama.
  Mr. BACHUS. Mr. Chairman, the original FCRA that the gentleman from 
Ohio pointed out was passed in 1996. Right? Not 1776. Is that right?
  I will admit to the gentleman from Massachusetts we took absolutely 
no testimony on the American Revolution and none of our witnesses 
actually tied that in. But I appreciate his input.
  Mr. MARKEY. Mr. Chairman, will the gentleman yield?
  Mr. OXLEY. I would be pleased to yield to my good friend, the 
gentleman from Massachusetts.
  Mr. MARKEY. Mr. Chairman, I think the gentleman from Alabama missed 
the point in the discussion of the gentleman from Ohio where he changed 
the metaphor from the American Revolution to moving the goal post, 
which makes sense. As a graduate of Ohio State, you would try to switch 
the form of the debate.
  But, nonetheless, we have California moving the goal post further 
away from the consumer, where in the minds of Californians, and most of 
us who have dedicated our lives to privacy, the California section 
moves it closer to the privacy objectives that ordinary families have 
for their personal financial information. And what we are doing here is 
essentially giving to the big financial institutions the ability to be 
able to circumvent this increasing interest at the State level of 
enhancing the rights of families to be able to protect their privacy.
  I hope when we get to the conference committee that my cochairman of 
the privacy caucus, Senator Shelby, who shares the passion on this 
issue, will be in disagreement with my colleagues as to whether or not 
we have reached in this bill the historic high point of where we should 
be in 2003 in terms of the protection of the privacy of American 
families.
  Ms. LEE. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
California (Ms. Waters), whose diligence on this bill has identified 
many errors we are trying to correct today.
  Ms. WATERS. Mr. Chairman, I would like to thank the gentlewoman from 
California (Ms. Lee) for all the work she has done on this most 
important issue.
  Mr. Chairman, if anybody had told me that I would be on the floor of 
Congress arguing States' rights, facing off with a conservative from 
Alabama, I would have told them they are crazy. But I am here today 
arguing States' rights on one of the most important issues confronting 
Americans today, and that is privacy.
  Americans do not want people peeping into their bedrooms. They do not 
want folks eavesdropping on their calls. And they sure do not want 
financial institutions selling their personal and financial 
information. And that is what this is all about. This bill would 
require financial institutions to first obtain a consumer's explicit 
consent before selling or sharing their personal or financial 
information with affiliates or third-party companies for any purpose 
other than to complete a transaction initiated by the consumer.
  What right do we have as Federal lawmakers saying to the American 
citizens that we do not care that they want their privacy protected; 
that we are the Federal Government; that we do not care what the States 
want because we have decided we want national standards for the 
convenience of

[[Page 21770]]

the financial institutions. We do not want the financial institutions 
to have to be inconvenienced by having a State like California have 
better consumer laws than they have in these national standards.
  I just do not believe the way this argument is going. I cannot 
believe that I am standing here defending the privacy rights and the 
States' rights of Americans against the conservatives on the other side 
of the aisle.

                              {time}  1715

  Mr. Chairman, it is just too much for me to absorb at this moment. 
Let me say we have worked hard in California to have better consumer 
laws, and I dare say if we do not get it on this side, we are going to 
have to fight in the other body. But in the final analysis, we also 
have the ballot in California. We will go to the ballot to deal with 
this issue.
  Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Chairman, let me reiterate again, because I think it 
is important that the gentlewoman from California (Ms. Waters) know 
this, nothing in this legislation will, in any way, stop SB1, the 
California bill, from requiring opt-in for third-party nonaffiliate 
sharing, nothing. The gentlewoman mentioned third parties, this was all 
about allowing institutions to share their privacy or their records 
with third parties. That is not what this bill is about. This bill does 
not authorize that. This bill does not permit that. There is nothing 
that does that. There is nothing in this bill that stops the second 
component of that new California law, and that is the privacy notices. 
Nothing in this legislation stops that.
  What this legislation does is it continues the present law. Gramm-
Leach-Bliley addressed the privacy issues, not fair credit reporting, 
and we are going to address those issues in hearings next year. As the 
gentleman from Massachusetts said, the chairman of the Senate has said 
he may address affiliate sharing in the Senate. That is fine. We may 
address it in conference. We did not address it in this bill.
  We did not do anything not allowed by present law. Currently, the 
present law does not preempt that.
  Finally, we established a high bar wherever we established a bar. The 
gentleman from California (Mr. Sherman) talked about one of the most 
important things that they did in California, and that is the telephone 
numbers, giving the telephone numbers. We put that in this bill over 
strong industry opposition. It is in there. It is an important new 
right that everyone in 50 States will have, and it is part of a 
national standard.
  Ms. LEE. Mr. Chairman, I yield myself the balance of my time.
  When the Committee rises and we are in the full House, I intend to 
submit for the Record a letter signed by 55 Democrats and Republicans 
from California discussing the fact that this law, if passed, would 
preempt California law, SB1.
  Finally, let me just say I want to support this bill, but why would 
any Representative from California support a bill that wipes out the 
protections for California consumers that they have worked so hard for, 
for so many years?
  Mr. Chairman, I will include for the Record the list of financial 
institutions in California that negotiated with our consumers and 
remained neutral as this bill was signed into law by Governor Gray 
Davis. I think it is very important that we protect California law, and 
if other States want to support stronger measures, allow States to do 
that. As the gentlewoman from California (Ms. Waters) said, this is a 
States' rights issue. I think this amendment would allow States to 
enact consumer protections that they deem necessary for their 
consumers.

       American Electronics Association
       California Bankers Association
       California Chamber of Commerce
       California Financial Services Association
       California Mortgage Bankers Association
       Capital One
       Citigroup
       Countrywide Financial
       Farmers Insurance
       Fidelity Investments
       Financial Services Privacy Coalition
       Household International, Inc.
       JP Morgan Chase
       MBNA
       Merrill Lynch
       Personal Insurance Federation of California
       Providian Financial
       Securities Industry Association
       State Farm Insurance
       Toyota Motor Sales USA
       Washington Mutual
       Wells Fargo

  Ms. ESHOO. Mr. Chairman, I rise today to urge my colleagues to vote 
in favor of the Sherman-Lee Amendment to give consumers control over 
their financial information.
  Seven million Americans were victims last year of ID theft. Overall, 
more than 33 million Americans have had their identities used by 
someone else sometime since 1990.
  The Department of Justice says ID theft is the nation's fastest 
growing financial crime and the damages to consumers are becoming even 
more significant.
  Despite the fact that millions of Americans are victimized by 
identity theft each year, Congress is getting ready to pass a bill that 
blocks states from enacting tougher reforms.
  The strongest financial privacy law in the nation passed in 
California last month with overwhelming bipartisan support. This new 
law, sponsored by State Senator Jackie Speier, allows consumers to stop 
banks and other financial institutions from sharing confidential 
account and transaction histories with most of their affiliated 
companies.
  As we consider this matter, I urge my colleagues to vote to bring 
these protections to all Americans and make sure that any changes to 
the Fair Credit Reporting Act truly benefit consumers.
  Vote in favor of the Sherman-Lee Amendment which protects 
California's financial privacy law and allow other states to enact 
similar laws.
  Ms. LEE. Mr. Chairman, I ask unanimous consent to withdraw this 
amendment.
  The CHAIRMAN. Is there objection to the request of the gentlewoman 
from California?
  There was no objection.


                  Amendment No. 12 Offered by Mr. Ney

  Mr. NEY. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 12 offered by Mr. Ney:
       Page 56, after line 16, insert the following new 
     subsection:
       (e) Technical and Conforming Amendment.--Section 624(b) of 
     the Fair Credit Reporting Act (15 U.S.C. 1681t(b)(3)) (as 
     amended by section 204(b) of this Act) is amended--
       (1) by striking ``or'' at the end of paragraph (2); and
       (2) by striking paragraph (3) and inserting the following 
     new paragraphs:
       ``(3) with respect to the form and content of any 
     disclosure required to be made under subsection (c), (d), 
     (e), or (f) of section 609, except that this paragraph shall 
     not apply--
       ``(A) with respect to sections 1785.10, 1785.16 and 
     1785.20.2 of the California Civil Code (as in effect on the 
     date of enactment of the Fair and Accurate Credit 
     Transactions Act of 2003) and section 1785.15 through section 
     1785.15.2 of such Code (as in effect on such date) and
       ``(B) with respect to section 12-14.3-104.3 of the Colorado 
     Revised Statutes (as in effect on the date of enactment of 
     the Fair and Accurate Credit Transactions Act of 2003); and
       ``(4) with respect to the frequency of any disclosure under 
     section 612(e), except that this paragraph shall not apply--
       ``(A) with respect to section 12-14.3-105(1)(d) of the 
     Colorado Revised Statutes (as in effect on the date of 
     enactment of the Fair and Accurate Credit Transactions Act of 
     2003);
       ``(B) with respect to section 10-1-393(29)(C) of the 
     Georgia Code (as in effect on the date of enactment of the 
     Fair and Accurate Credit Transactions Act of 2003);
       ``(C) with respect to section 1316.2-B of title 10 of the 
     Maine Revised Statutes (as in effect on the date of enactment 
     of the Fair and Accurate Credit Transactions Act of 2003);
       ``(D) with respect to sections 14-1209(a)(1) and 14-
     1209(b)(1)(i) of the Commercial Law Article of the Code of 
     Maryland (as in effect on the date of enactment of the Fair 
     and Accurate Credit Transactions Act of 2003);
       ``(E) with respect to section 59(d) and section 59(e) of 
     chapter 93 of the General Laws of Massachusetts (as in effect 
     on the date of enactment of the Fair and Accurate Credit 
     Transactions Act of 2003);
       ``(F) with respect to section 56:11-37.10(a)(1) of the New 
     Jersey Revised Statutes (as in effect on the date of 
     enactment of the Fair and Accurate Credit Transactions Act of 
     2003); and
       ``(G) with respect to section 2480c(a)(1) of the Vermont 
     Statutes Annotated (as in effect on the date of enactment of 
     the Fair and Accurate Credit Transactions Act of 2003).''.


[[Page 21771]]


  The CHAIRMAN. Pursuant to the order of the Committee of today, the 
gentleman from Ohio (Mr. Ney) and the gentleman from Massachusetts (Mr. 
Frank) each will control 10 minutes.
  The Chair recognizes the gentleman from Ohio (Mr. Ney).
  Mr. NEY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I commend the leadership shown by the gentleman from 
Ohio (Mr. Oxley), the ranking member, the gentleman from Massachusetts 
(Mr. Frank), and the subcommittee chairman, the gentleman from Alabama 
(Mr. Bachus), and their staff who put this important bill together.
  Reauthorizing the expiring provisions in the Fair Credit Reporting 
Act had the potential to be extremely divisive, partisan and 
contentious. However, their diligent efforts have created a solid piece 
of legislation that was reported from the Committee on Financial 
Services by an overwhelming bipartisan vote. I believe this legislation 
is a testament to their hard work, and I give them credit for it.
  Mr. Chairman, the Ney-Royce-Scott amendment is straightforward. It 
will amend sections 501 and 502 of H.R. 2622 so they will be able to 
set a national standard for consumer access to credit scores and credit 
reports. As Members know, section 501 requires that all consumers have 
the right to request a free copy of their credit report every year. 
This is a common sense way to help combat identity theft and fraud 
while helping Americans maintain a good credit rating.
  Section 502 requires that consumers be able to request their credit 
scores for a reasonable fee, and that when they apply for a mortgage, 
the credit score their mortgage was based on be provided for a 
reasonable fee also. I think this is not only good for home buyers, but 
also a common sense way for consumers to be able to protect themselves 
from fraud and protect their credit history.
  These are just two of the many new consumer protections in the FACT 
Act. However, neither sections 501 nor 502 is a national standard. As 
it is currently drafted, H.R. 2622 is silent on whether States can add 
requirements on top of those already in sections 501 and 502 of the 
bill.
  This could mean that consumers could be faced with new, confusing 
duplicative and potentially burdensome disclosure requirements. I want 
to make it clear I do not want to prevent States from being able to 
protect their citizens. It has been proven time and again that the 
States often provide the best laboratory for testing new ways to 
protect consumers from fraud. The ability of States to be more nimble 
and to be more responsive than the Federal Government has allowed them 
to experiment with new ways to offer important consumer protections. In 
fact, both sections 501 and 502 can find their roots in State law. For 
example, section 502 is nearly word-for-word identical to law in 
California. Likewise, seven States currently have different 
requirements for making free credit reports available to consumers.
  In recognition of the leadership States have shown, this amendment 
allows those States that already have laws in place and which lenders 
and credit bureaus already comply with to remain on the books, much 
like in 1996 when we put in place national standards, but grandfathered 
in laws that were already on the books.
  However, much like in 1996, now that we are taking the lessons of 
those laws and forming them into a national standard, we must take the 
next step and make this standard truly national by preventing States 
from enacting new and duplicative laws that could harm consumers in the 
future. If we are not careful, consumers could end up getting multiple 
disclosures with different numbers, explanations, and forms that are 
highly confusing and even contradictory. Even worse, if sections 501 
and 502 are not made a national standard, a patchwork of State laws 
could end up raising costs for consumers, something none of us want to 
see happen. That does not benefit consumers, which is why we need a 
single national standard that provides consumers with one clear and 
comprehensive disclosure. I believe sections 501 and 502 achieve that 
goal.
  I do not doubt that the new requirements in sections 501 and 502 will 
be costly to industry. However, I think that most of us would agree 
that those costs are worthwhile because of the protections they afford 
consumers. That is one of the many trade-offs we have been forced to 
consider when drafting this bill.
  Mr. Chairman, as I mentioned a moment ago, if we allow States to add 
more and more regulations on top of those already in H.R. 2622, then we 
create the risk of adding so many burdens that ultimately the consumer 
will see increased costs. That is why I urge my colleagues to support 
uniform national standards for consumers by supporting this amendment.
  We have an opportunity to make a strong statement about the need to 
pass strong consumer protections while also making the statement that 
those consumer protections must be uniform. I urge Members to vote on 
the bipartisan Ney-Royce-Scott amendment, and I thank the cosponsors of 
the amendment.
  Mr. Chairman, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as 
I may consume.
  Mr. Chairman, the crux of this is that by this amendment, the 
gentleman from Ohio (Mr. Ney) seeks to extend preemption beyond where 
it is under current law. I believe what we attempted to do, with a 
great deal of success, we made a mistake with regard to California, was 
to go forward with existing preemptions, to bring them forward, while 
we added some consumer protections. It is not contested. This amendment 
would preempt State activity that is not now preempted.
  If we simply extended the Fair Credit Reporting Act without this 
amendment, there are things that the States could do that this 
amendment will prevent them from doing. Yes, the bill does make some 
improvements with regard to credit scores and with regard to credit 
reports. But as an example, and I recognize that the gentleman's 
amendment does grandfather current State law that goes beyond what the 
Federal law does, but I cite these two States not because they are 
going to be preempted, but because they are an example of the kind of 
actions that States have taken in the past that would be preempted in 
the future.
  Two of our more radical States have taken actions in the past that 
would be preempted in the future, Colorado and Georgia. What this 
amendment says is no other State should be as radical and as anti free 
market and as populist as those two places, Colorado and Georgia. 
Colorado and Georgia have both seen fit in their legislative processes 
to extend to their citizens rights with regard to credit scores and 
credit reports that no other State will be allowed to do if this 
amendment is adopted.
  Now credit scores, in particular, are very important. Members should 
check with their own constituents and their own State governments. 
Credit scoring is spreading. People are now finding that credit scoring 
is being used not simply to give them a loan, but to give them 
insurance. It has become a very controversial subject. Indeed, one of 
the things that is in this bill, and I appreciate the chairman having 
agreed with us that it should be there, is a study that we have 
commissioned about the legitimacy of using credit scoring as a standard 
in areas outside the granting of credit.
  Should consumers be denied insurance because there was a past credit 
problem if those consumers are being given insurance that does not 
involve credit, insurance which needs to be paid for currently?
  The gentleman's amendment would prevent States in the future from 
going beyond where we are with regard to credit scoring. I agree there 
is need for uniformity in some things, but insurance has always been a 
State matter. I do not believe we need a national policy with regard to 
the regulation of insurance. If we do, then we have to change a lot 
more than simply preempt this because we have left insurance there.

[[Page 21772]]

  I want to emphasize at this point, I understand this does not preempt 
what is currently around in some States, but it says in an area that is 
of growing concern to the States, credit scoring and that has 
particular concern for members of ethnic minority communities, you may 
not do anything in credit scoring that we have not done.
  We do good things in this bill, but I do not think that it is 
perfect. I do not think it explores and occupies the entire universe of 
consumer protections. I believe there are things that the States could 
do that would be relative to that State that would not impinge on 
others.
  I do not think the Colorado and Georgia rules interfere elsewhere. 
For instance, in Colorado it says as I said it, that if you are going 
to be treated negatively because there have been too many inquiries on 
your credit report, the credit agency has to tell you that so you can 
take some action to protect yourself. I think that is a reasonable 
thing for a State to be able to do. I am glad Colorado has done it. I 
do not think Colorado ought to be, as it would be under this amendment, 
the last State to be able to make that protection. I hope that we will 
stick with what I thought was the outlines of what we were agreeing to 
here which was to preserve the existing preemptions, but not to extend 
them.
  Mr. Chairman, I reserve the balance of my time.
  Mr. NEY. Mr. Chairman, I have no additional requests for time, and I 
yield back the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself the balance 
of my time.
  Mr. Chairman, I want to just stress again, and I was reminded by one 
of our able staff members, in the case of credit scoring, we have in 
our legislation emulated what California did to some extent.

                              {time}  1730

  I will be prepared to agree to a unanimous consent request that 
subsequently no one will be allowed to mention California in this 
debate. I would be ready to agree to that. But I will take my one last 
reference to it and say we have benefited from what the States do. Even 
if you believe in preemption, this is the wrong time in the evolution 
of national policy to lock in a preemption with regard to credit 
scoring. I warn Members, credit scoring is an explosive issue in some 
areas. It is one which is being expanded beyond the granting of credit. 
Do not vote for an amendment that will limit your State's ability to 
respond to what consumers will feel is very important in the area of 
credit scoring, and that is what this amendment would do. Even if you 
believe in an ultimate preemption, it is at a very premature stage. 
Credit scoring is a relatively new issue in terms of its being extended 
to other areas. I do not see any reason why we should go beyond the 
existing preemptions. Everyone has said they work very well. All the 
studies have been of the existing preemptions.
  I want to be very clear once again, this is a new preemption. This 
would have the States lose the right that they now have, and have under 
the Fair Credit Reporting Act, to protect their citizens, particularly 
with regard to the area of credit scoring. I think it would be very 
unwise. I urge the Members to stay with the committee position here and 
defeat this amendment.
  Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Ohio (Mr. Ney).
  The question was taken; and the Chairman announced that the noes 
appeared to have it.
  Mr. NEY. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to clause 6 of rule XVIII, further proceedings 
on the amendment offered by the gentleman from Ohio (Mr. Ney) will be 
postponed.


                 Amendment No. 11 Offered by Mr. Royce

  Mr. ROYCE. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 11 offered by Mr. Royce:
       Page 34, strike line 9 and all that follows through line 
     18, and insert the following new subparagraph:
       ``(A) In general.--A consumer may dispute directly with a 
     person the accuracy of information that is contained in a 
     consumer report on the consumer prepared by a consumer 
     reporting agency described in section 603(p), if--
       ``(i) the information was provided by the person to that 
     consumer reporting agency in accordance with paragraph 
     (1)(B);
       ``(ii) the consumer has disputed the accuracy of such 
     information with the consumer reporting agency that prepared 
     the consumer report pursuant to section 611;
       ``(iii) the consumer has received the results of the 
     investigation from the consumer reporting agency and has 
     requested that the consumer reporting agency reinvestigate 
     the results in accordance with section 611; and
       ``(iv) the results of the consumer reporting agency's 
     reinvestigation requested pursuant to (iii), as reported to 
     the consumer, do not resolve the dispute.''
       Page 35, beginning on line 25, strike ``thereafter report 
     correct information to'' and insert ``notify''.

  The CHAIRMAN. Pursuant to the order of the Committee of today, the 
gentleman from California (Mr. Royce) and the gentleman from 
Massachusetts (Mr. Frank) each will control 10 minutes.
  The Chair recognizes the gentleman from California (Mr. Royce).
  Mr. ROYCE. Mr. Chairman, I yield myself such time as I may consume. I 
am offering this amendment today on behalf of myself and on behalf of 
the gentleman from Pennsylvania (Mr. Toomey) and the gentleman from 
Ohio (Mr. Tiberi). We are doing this to correct some of the serious 
problems with the furnisher liability provision that was offered by the 
committee's ranking member during the full committee markup. That 
particular provision penalizes businesses who voluntarily provide the 
information that makes our credit system work. The provision also turns 
the existing system for correcting errors on its head with little 
evidence that it will do anything to increase the accuracy of that 
system. As the director of the FTC's Bureau of Consumer Protection 
recently said, and I will quote these remarks, ``We don't want to 
discourage voluntary reporting. Imposing too many obligations on the 
furnishers could have that effect.''
  As our chairman will recall, I believe, I along with several other 
members of the committee raised these concerns about what we perceived 
as these serious flaws. We were told by the other side of the aisle 
that each of these problems we raised would be addressed before 
consideration on the House floor. Unfortunately, we have not yet found 
common ground. I am hopeful that we yet will; but the amendment that I 
have filed here seeks to resolve the following key problems, and I want 
to state these problems again so that we can focus on them.
  First, the furnisher liability provision would allow the current 
system to be circumvented, thereby flooding small- and medium-sized 
credit grantors with unnecessary investigations; second, that provision 
in the bill opens the door for credit repair clinics to subvert the 
existing system by overwhelming furnishers who are ill prepared to 
address these tactics. By overwhelming, we mean sending in tens of 
thousands at one time. Last, that provision effectively doubles the 
number of reinvestigations businesses would have to handle by 
encouraging consumers to file in two different places at the same time, 
because they would file both with the furnisher and they would file 
with the credit bureau. In short, the provision would drive many 
furnishers out of the voluntary system. That would reduce the integrity 
and accuracy of our system.
  The current dispute resolution system resolves the overwhelming 
majority of disputes. It is only the very small number of unusual 
problems that need specialized attention. Our amendment that we are 
offering here preserves the existing system that works for so many 
consumers today, but provides a new right for those infrequent 
instances where the current system may not be sufficient. In short, our 
amendment requires individuals to use the current investigation and 
reinvestigation process through the bureaus.

[[Page 21773]]

If the dispute is not resolved, it would then allow individuals to take 
their credit bureau dispute directly to the furnisher, and it compels 
the furnisher to address it within 30 days under a threat of liability. 
I think this approach addresses each of the concerns raised in the 
markup while providing a new dispute resolution process for those 
individuals who are not served through the current system.
  Mr. Chairman, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as 
I may consume.
  This is a difficult issue. Let me say first, I very much agree with 
the gentleman, and this is something that I want us to return to; and I 
hope the chairman will do this. The credit repair agencies, I agree, 
are a problem. Whatever system we have, I think there is an abusive 
practice there. I think the gentleman is right to point to it. I myself 
check my voice mail when I am down here. I called my Massachusetts 
voice mail where my phone is listed, and I have a man telling me that 
he has got my credit records in front of him and he can help me with my 
debts. Since I pay up pretty regularly, I thought maybe this was 
identity theft. I called him up, and it was one of these phoney credit 
repair agencies. I called just to do that.
  Let me say to the gentleman, I would be glad to work with him to do 
legislation, because whatever we do, whatever remedy we give, we are 
going to have the problem of credit repair. I think he has pointed to a 
very good problem. I would just say to the gentleman that I look 
forward to working with him. I cannot support this particular 
amendment, but I would be glad to work with our chairman on dealing 
with the credit repair issue.
  Mr. ROYCE. Mr. Chairman, will the gentleman yield?
  Mr. FRANK of Massachusetts. I yield to the gentleman from California.
  Mr. ROYCE. I thank the gentleman for yielding. I look forward to 
trying to work out a satisfactory compromise on this.
  Mr. FRANK of Massachusetts. Mr. Chairman, I reserve the balance of my 
time.
  Mr. ROYCE. Mr. Chairman, I yield 3 minutes to the gentleman from 
Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Chairman, the problem that the gentleman from 
California has identified is a real problem, and it does need a 
solution. I want to reiterate what the gentleman from Massachusetts 
said, because I think there is genuine support for finding a solution 
to this. The last thing we want is for small- and middle-sized 
businesses to be burdened down and not to report information to the 
national credit reporting system because this could actually encourage 
a situation in which people, knowing that they do not participate 
because of a liability, target them, do business with them and knowing 
that they are not part of the national credit reporting system. The 
more information that goes into that system, the more valuable it is. 
It is often these small- and middle-sized businesses that in fact do 
not have the sophistication to collect bad debts or to write off bad 
debts; and when they take a loss, it is more severe because it reflects 
a greater percentage. So the very businesses that need to be not only 
furnishing information but drawing information, we need to do 
everything we can to encourage those retailers and others to 
participate in the system.
  I fear that unless somewhere in conference or in the Senate, and I 
would say to the gentleman from California, we just simply have not 
come up with the right language yet, but I know the gentleman from Ohio 
is very committed to working on this issue. I want to commend the 
gentleman from California for working on this issue and identifying it 
and bringing it to our attention, along with the National Retail 
Association that has made us very aware that this is a weakness of the 
bill as it now exists.
  Mr. ROYCE. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from 
Virginia (Mr. Cantor).
  Mr. CANTOR. Mr. Chairman, I thank the gentleman from California for 
yielding me this time. First of all I would like to congratulate the 
gentleman from Ohio (Mr. Oxley), the gentleman from Alabama (Mr. 
Bachus), and the gentleman from Massachusetts (Mr. Frank) for producing 
a bill that addresses an extremely important issue. I know that the 
gentleman from Alabama has been quoted as saying that this is probably 
one of the most important economic initiatives that we have got to 
accomplish this session because it means so much to so many people.
  I was reading some figures that say that if we are not going to go 
forward, if we did not or had not gone forward with reauthorizing the 
Fair Credit Reporting Act, it would result in a $20 billion loss in the 
consumer spending area. Actually, as some of the dialogue here has 
indicated, it would fall really on those that need help, who need 
access to credit most. I am glad that we are here, and I congratulate 
the chairman on his work.
  I also am here to support the gentleman from California in trying to 
search for a solution to a provision that is in the bill that would, as 
has been said earlier, provide a disincentive for retailers to be a 
part of this nationwide system that we have that affords individuals 
access to credit. For the reasons stated before, the provision as it 
stands now, which would force an individual seeking to correct 
information on a credit report to go to the furnisher rather than the 
parties currently doing it now in the credit bureaus, would provide 
inefficiencies on the part of the furnishers; would, as I said earlier, 
provide a disincentive for those furnishers to even offer the 
information to the credit bureau; and ultimately, I think, would drive 
up costs for everybody. As we know, the individuals who end up 
suffering most are those who we are trying to help by affording the 
least expensive access to credit.
  Again, I congratulate the gentleman from California on his efforts 
and want to offer help in any way that I can to hopefully resolve this 
issue.
  Mr. ROYCE. Mr. Chairman, I yield myself such time as I may consume.
  I very much appreciate the support from the gentleman from Virginia. 
I appreciate the offer from the ranking member to work toward a 
resolution of this. In the spirit of cooperation, I am going to 
withdraw this amendment. However, Mr. Chairman, I am going to ask for 
your commitment that you will continue to work with me to ensure that 
these problems are resolved before a final conference report comes back 
to the House.
  Mr. OXLEY. Mr. Chairman, will the gentleman yield?
  Mr. ROYCE. I yield to the gentleman from Ohio.
  Mr. OXLEY. Mr. Chairman, let me indicate my support for the 
gentleman's purposes here. I think he makes an excellent point. We had 
some good debate in the committee as well as here on the floor. As we 
work toward, hopefully, the conference committee, I pledge my support 
for trying to find an answer to this difficult problem.
  Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
  Mr. ROYCE. I yield to the gentleman from Massachusetts.
  Mr. FRANK of Massachusetts. Mr. Chairman, I would say, particularly 
with regard to protecting legitimate merchants against abusive credit 
repair companies, I would be glad to work with the gentleman.
  Mr. ROYCE. Mr. Chairman, I ask unanimous consent to withdraw the 
amendment.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
California?
  There was no objection.

                              {time}  1745


                 Amendment No. 4 Offered by Mr. Sanders

  Mr. SANDERS. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 4 offered by Mr. Sanders:
       Page 69, after line 5, insert the following new section 
     (and conform the table of contents accordingly):

[[Page 21774]]



     SEC. 507. LIMITATION ON USE OF CONSUMER REPORTS.

       (a) In General.--Section 604(d) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681b(d)) is amended to read as 
     follows:
       ``(d) Limitation on Use of Consumer Report.--No credit card 
     issuer may use any negative information contained in a 
     consumer report to increase any annual percentage rate 
     applicable to a credit card account, or to remove or increase 
     any introductory annual percentage rate of interest 
     applicable to such account, for reasons other than actions or 
     omissions of the card holder that are directly related to 
     such account or a late payment of 60 days or more on any 
     another credit card or debt.''.
       (b) Technical and Conforming Amendment.--Section 
     604(a)(3)(F)(ii) of the Fair Credit Reporting Act (15 U.S.C. 
     1681b(a)(3)(F)(ii)) is amended by inserting ``subject to 
     subsection (d),'' before ``to review''.

  The CHAIRMAN. Pursuant to the order of the committee of today, the 
gentleman from Vermont (Mr. Sanders) and a Member opposed each will 
control 15 minutes.
  The Chair recognizes the gentleman from Vermont (Mr. Sanders).
  Mr. SANDERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, this amendment is cosponsored by the gentlewoman from 
California (Ms. Waters) and the gentlewoman from California (Ms. Lee). 
It is also strongly supported by the Consumer Federation of America, 
the Consumers Union, the Electronic Privacy Information Center, the 
National Association of Consumer Advocates, the National Consumer Law 
Center, the New York Public Interest Research Group, the Privacy Rights 
Clearinghouse, the Privacy Times, and the U.S. Public Interest Research 
Group. In other words, almost every major consumer organization in 
America is supporting this amendment.
  Mr. Chairman, this amendment deals with an issue which is of growing 
concern to millions of credit card holders, and that is that, 
increasingly, credit card companies are engaging in an outrageous bait 
and switch practice which is costing consumers hundreds of millions of 
dollars.
  This, Mr. Chairman, is how the scam works: In our country today, 
credit card companies are sending out over 5 billion solicitations a 
year. Yes, that is right, 5 billion pieces of mail are being sent to 
Americans every year in order to purchase this or that credit card. 
Sometimes I think about half of those solicitations come to my kids. 
Nonetheless, we are all receiving them. As we all know, these mailings 
very often have bold headlines stating zero percent interests rates for 
6 months, or 2.5 percent interest rates for a year, or whatever. We all 
receive them.
  Now, here, Mr. Chairman, is the scam and the bait and the switch. An 
individual fills out the form and purchases the credit card, and month 
after month after month, he or she pays the amount owed to the credit 
card company faithfully and on time. In other words, the individual 
consumer has fulfilled his or her end of the contract. But in the midst 
of this, something strange happens. People are paying up on time, but 
suddenly the interest rate skyrockets, despite the individual making 
their payment on time.
  Now, how can this happen? How can interest rates double or triple 
when the individual has fulfilled the obligations of the credit card 
company and made payments on time and never has gone over the credit 
card limit?
  Well, it happens because the credit card issuers, companies like 
Chase Manhattan, Citigroup or Bank One, have decided all on their own 
that the consumer has become a greater financial risk, even when that 
consumer has in every instance paid their credit card bill on time.
  What happens is the company obtains information from their customer's 
credit report which indicates a late payment on another financial 
transaction, another transaction. Perhaps the consumer might have been 
late in paying a student loan or a mortgage payment or a medical bill, 
and because the individual was late paying off another financial 
transaction, having nothing to do with the credit card they have from 
this company, the credit card company raises interest rates on their 
transaction with that individual.
  Even more outrageous, credit card companies are raising interest 
rates when the consumer has never been late on any payment, and here is 
the crime there: There is an illness in the family. Somebody borrows 
money to pay off a medical bill; and, because they have committed that 
terrible crime of borrowing money for a medical reason, interest rates 
will go on the credit card, although they have never been late on any 
payment.
  That is absurd, that is unfair, and that is a rip-off of the American 
people. At a time when the Federal Reserve has lowered short-term 
interest rates 13 times, why do we have consumers in this country 
paying 16 percent, 26 percent, even 29 percent APR on their credit 
cards?
  Furthermore, Mr. Chairman, the Committee on Financial Services and my 
Subcommittee of Financial Institutions, of which I am the ranking 
member on, have heard from a number of witnesses about the inaccuracies 
of credit reports. According to freecreditinsight.com, over 70 percent 
of credit reports contain errors, so the credit reporting agency makes 
a mistake and your interest rates go zooming up.
  By charging higher interest rates, the profits of credit card 
companies skyrocket and consumers grow deeper and deeper into debt. Is 
it any wonder why bankruptcies in the U.S. are now at an all time high, 
increasing by 23 percent since 2000?
  Mr. Chairman, this is the issue. This is a very simple issue. It is 
an issue of fairness. If I take out a credit card and the credit card 
company says to me you have to pay up at a certain time and your 
interest rates are such-and-such, and I do that every single month, 
that is what the deal should be. And, if I am late, if I go above the 
amount of credit that I agreed to, well, I agree, they have a right to 
penalize me. They do not have a right to double or triple my interest 
rates when I pay my bills on time and because I took out a loan because 
my wife might have been ill.
  Mr. Chairman, Congress has a responsibility to stop the credit card 
industry from ripping off consumers by this deceptive and unfair 
practice. I urge my colleagues to vote for this amendment to restrict 
the credit card interest rate bait and switch.
  Specifically, this amendment would prohibit credit card issuers from 
using negative information contained in their customers' credit 
reports, such as a late payment on a student loan, a lower credit 
score, a new mortgage or new loan to pay for medical emergency or an 
error in a credit report, as a reason to double or triple credit card 
interests rates.
  Importantly, as part of a compromise worked out at the committee 
level, this amendment has been crafted so that if a consumer is at 
least 60 days delinquent on any other credit card or debt, the credit 
card company could still use that information to increase the interest 
rates of their customers.
  Mr. Chairman, I reserve the balance of my time.
  The CHAIRMAN. Who seeks to control time in opposition?
  Mr. OXLEY. Mr. Chairman, I claim the time in opposition to the 
Sanders amendment.
  The CHAIRMAN. The gentleman from Ohio is recognized for 15 minutes.
  Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, this amendment, first of all, was defeated on a 
bipartisan vote of 44 to 22 in the Committee on Financial Services.
  Chairman Greenspan has raised serious concerns about this amendment. 
Let me quote, if I may, from a letter from Chairman Greenspan to the 
gentleman from Delaware (Mr. Castle) who had requested the response 
from the Fed, and specifically Chairman Greenspan, regarding the 
amendment offered by the gentleman from Vermont.
  He says in part, ``The information gathered by credit reporting 
companies on the borrowing and payment experiences of consumers is a 
cornerstone of the consumer credit system in this country. Experience 
indicates that access to the information assembled by these companies 
and credit evaluation systems based on that information have improved 
the overall quality and

[[Page 21775]]

reduced the cost of credit decisions while expanding the availability 
of credit.''
  He goes on to end in this way: ``In sum, in deciding whether to 
restrict the use of certain information in credit evaluations, the 
Congress should be aware that such restrictions are likely to diminish 
the effectiveness of statistical systems that have played a significant 
role in reducing the overall cost of credit and widening its 
availability.''
  So what we have here is the chairman of the Fed saying that the 
Sanders amendment is going to have a chilling effect on the 
availability of credit, and could drive up the cost of credit at the 
same time, basically saying to those of us who are good credit risks, 
we will be asked to pay for those who are less responsible in paying 
back those credit card debts.
  Now, the committee did adopt an amendment offered by the gentlewoman 
from New York (Mrs. Maloney) that specifically addresses the issue 
raised by the gentleman from Vermont. It requires any preapproved 
credit card solicitation to disclose the credit card issuer's ability 
to adjust the interest rate for reasons other than delinquencies on the 
credit card account. The notice will educate the consumer and allow him 
or her to act accordingly.
  So in place of this rather draconian approach by the gentleman from 
Vermont, we have the gentlewoman from New York's amendment, which is 
part of this bill that we are debating now, adopted in the committee 
unanimously, that would provide more information, more notice to the 
consumer, to make certain that they are aware that, should a 
delinquency occur, it is a possibility that the interest rate could go 
up.
  Essentially, this is an overkill amendment, and the committee found 
by a two-to-one margin that indeed that was the case. Nothing has 
changed from the time that the committee adopted the bill to today on 
the floor.
  So the amendment would clearly increase the cost, and probably 
decrease the availability of credit for credit card borrowers. Lenders 
must have the ability to adjust the interest rate on a loan in order to 
adequately price for that borrower's risk.
  It seems obvious that those who are good credit risks are able to 
obtain credit at lower costs. That is how our system works. If someone 
who is a good credit risk suddenly imposes additional risk to the 
lender, the lender should be able to adjust for this increased risk. 
The amendment would prohibit a credit card issuer from doing this in 
many circumstances, and what the likely impact of this Sanders 
amendment would be lenders would be forced to offer credit card 
accounts at higher interest rates in order to buffer against any 
potential future risk that any borrower may present.
  Frankly, for those of us, the vast majority of us, those who pay 
their credit card bills monthly and are responsible, why should we be 
faced with a potential for higher interest rates and less available on 
that score? Adjusting the price of credit to match the level of risk 
imposed by the customer is not a bait-and-switch tactic, it is simply 
good, common sense, and such adjustments are already adequately 
addressed by existing law, particularly in regard to the Maloney 
amendment.
  To that extent, I oppose the Sanders amendment.
  Mr. Chairman, I reserve the balance of my time.
  Mr. SANDERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, my friend from Ohio just said why should people who pay 
their bill on time every month be penalized? I agree with him. But as 
the gentleman knows, right now people pay their bills on time every 
single month and, despite that, they can see a doubling or tripling of 
their interest rates, and that is precisely what we are trying to 
prevent.
  Mr. Chairman, I yield 2 minutes to the gentlewoman from California 
(Ms. Lee).
  Ms. LEE. Mr. Chairman, let me just thank the gentleman from Vermont 
for his leadership on the committee and for bringing this amendment 
today to the floor. But I must say that this is a very moderate 
amendment, it is a very conservative amendment, and I was, quite 
frankly, surprised he would go for it. But in the spirit of compromise, 
he did. So, very seldom do I believe that something is better than 
nothing, but I believe that this is such a fundamental injustice as it 
relates to our consumers that I had to support this very modest 
measure.
  Quite frankly, a creditor should not be allowed to increase interest 
rates if consumers are paying the debt according to the agreed upon 
terms. They should not be allowed to raise interest rates based on 
payment histories of another debt. That is just fundamentally wrong. 
When individuals agree to a contract, when a consumer believes that 
they are doing the right thing and paying their monthly payments, how 
in the world can they get set up to fail? That is what this does.

                              {time}  1800

  An interest rate that jumps from 7 percent to 29 percent, bankruptcy, 
certainly, will follow if, in fact, this does not fit within the 
consumer's financial scheme. And generally, the consumer has a 
financial plan that they have to stick to in terms of payment schedules 
of debts. And so a huge payment like this is wrong. It would make more 
sense if the gentleman from Vermont (Mr. Sanders) had offered an 
amendment to say what I just said earlier, that a creditor should never 
be allowed to increase an interest rate on a debt if, in fact, the 
consumer is paying that debt based upon the agreed-upon agreement. But 
I understand how this place works, and I really thought that he had 
enough support on the other side to at least get this very basic kind 
of amendment passed, I would say to the gentleman. So I want him to 
know that I support it. I thank him for bringing it to the floor. But 
just know I think that sooner or later, we have to correct this 
injustice.
  Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from 
Virginia (Mr. Cantor).
  Mr. CANTOR. Mr. Chairman, I thank the chairman for yielding me this 
time.
  I rise in opposition to the Sanders amendment. I am listening to the 
gentlewoman from California's remarks that we should not allow a credit 
card company or a bank to alter one's interest rate on an extension of 
credit based on that consumer's performance in the marketplace, but if 
we look back to the beginning of the transaction to see how the credit 
was extended to begin with, it was based on the overall credit picture. 
And we have a nationwide credit access, information access system that 
affords lenders the ability to know more about their risk. And by tying 
the hands and essentially asking the credit card issuer and the lender 
to ignore information that will impact their risk will end up 
ultimately denying more credit to more people.
  Mr. Chairman, we ought to let the marketplace work. We ought not go 
in and try and micromanage someone's business. We have the laws in 
place which require disclosure. There is the Maloney amendment that was 
attached in committee which will ensure adequate notice if there is, 
for some reason, the increase in the rate. Again, the end of the day is 
we want to make sure as many people as possible have access to credit.
  What this amendment will do, as the chairman has said, will raise 
rates for everyone and will deny those who really need the credit 
access to those funds.
  Mr. SANDERS. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
California (Ms. Waters).
  Ms. WATERS. Mr. Chairman, I rise in support of this amendment. Mr. 
Chairman, I was hopeful that my friends on the opposite side of the 
aisle would have the good sense not to oppose something like this. This 
is so ridiculous. This is so ridiculous that they could absolutely 
defend a credit card company increasing your interest rates, even 
though you are paying your bills on time every month. You are paying 
your bills on time, you have not missed a payment, but because you did 
not pay Nordstrom's or Gap, and you

[[Page 21776]]

may have a dispute with them, they are going to raise your interest 
rates. Then, my friends on the opposite side of the aisle will say, 
they have to do that; and if we do not allow them to do that, that will 
have a chilling effect on credit.
  Well, I think what one of my friends on this side of the aisle just 
said to me makes a lot of sense. She said, you know, this is nothing 
but a racket. You are defending a racket. You are defending a racket 
that is exploiting the people for no good reason. They simply want to 
make more money, and they can come up with any excuse, any way possible 
to get more money, to gouge your constituents; and you would stand here 
and argue that unless we allow them to gouge your constituents, you 
will have a chilling effect on them being able to get some credit. Give 
me a break. This is the greatest ripoff I have ever seen. And to add to 
it that if you are paying your bills on time, you are not missing a 
payment, and you go out and borrow some money because you may have a 
situation where you need more money, they look at that and say, oh, 
they went out and they borrowed some more money; I can use this, and I 
can describe it as a credit risk. Up with the interest rates.
  Oh, you are better legislators than that. You do not want to do that 
to your consumers. You do not want to undermine them that way. You do 
not want to have the dollars that they are working hard to earn pulled 
out of their pockets in this racket.
  Support the amendment. That is the decent thing to do.
  Mr. OXLEY. Mr. Chairman, I am pleased to yield 3 minutes to the 
gentleman from Delaware (Mr. Castle).
  Mr. CASTLE. Mr. Chairman, I thank the chairman for yielding me this 
time.
  We had this discussion on this amendment before the Committee on 
Financial Services, and it did not make a lot of sense then; and, 
frankly, it does not make a lot of sense now, that we would even 
consider this amendment.
  Essentially, those who are issuing credit, particularly credit cards, 
that is their business, that is their product, that is what they do. 
And what they have to look to is the creditworthiness of any of us. We 
probably all in this room and most people in this country today are 
carrying some sort of credit card, and probably multiple credit cards 
in the cases of most individuals. And that is based on one's ability to 
be able to pay their debts and be able to manage their accounts. 
Obviously, the one account is not necessarily the whole answer. The 
whole answer is exactly where you are financially. They make a decision 
with respect to where you are in a circumstance, and they issue the 
credit based on that. With the Maloney amendment, we have a 
circumstance in which people will be informed that if, indeed, their 
creditworthiness is challenged, they may have to pay higher interest 
rates.
  The chairman cited a letter which I received on July 22, 2003, from 
Chairman Greenspan with respect to this issue, and I would just like to 
read a little further from that beyond what he had read. He said, 
``Consumers' performance on credit accounts as well as the number and 
recency of certain types of inquiries to credit reporting companies are 
credit criteria that are statistically associated with creditworthiness 
in evaluative systems that are used for credit granting and pricing. 
Records of consumers' usage of, and payment performance on, credit 
accounts with other creditors are fundamental building blocks for 
evaluations of creditworthiness. For example, where a creditor commits 
to allow a consumer to make purchases or obtain cash advances from time 
to time on a revolving line of credit, the consumer's performance on 
other credit accounts can well presage the credit risk outlook for the 
creditor's own account,'' and it goes on from there.
  It is relatively simple. You are in a situation in which an 
individual has taken credit based on the circumstances of their own 
creditworthiness and then has gone out and established their 
creditworthiness as not what it should be. There are problems or 
circumstances. Frankly, the credit card companies and others dealing 
with this do not want to have to do this if they can avoid it because 
it is easier for them to deal with it on the levels on which it is 
issued; but there are circumstances in which this happens, or perhaps 
this discourages it from happening, that is your interest rates might 
be increased.
  So I think for all of these reasons, while this amendment sounds to 
be well-intended, ultimately would be extremely counterproductive in 
that I think a lot of the credit which is issued now, because people 
realize that this may be an outlet in order to make sure that people do 
not extend their credit otherwise, might in the future not be able to 
be granted, simply because the credit issuers are going to say this 
person has sort of a spotty history and yes, we would have done it if 
we had known we could have increased the interest rate if necessary, 
but in this circumstance we are not going to issue it. I think you are 
going to find a lot of people who marginally might have been able to 
receive credit before are not going to be able to receive it if this 
amendment were to be adopted. So I encourage the defeat of the 
amendment.

         Board of Governors of the Federal Reserve System,
                                    Washington, DC, July 22, 2003.
     Hon. Michael N. Castle,
     House of Representatives, Washington, DC.
       Dear Congressman: This letter responds to your request of 
     July 18, 2003, seeking my views as to whether proposed 
     changes to the Fair Credit Reporting Act might affect the 
     pricing of credit based upon risk or might potentially bear 
     upon the safety and soundness of creditors. The proposed 
     amendments referred to in your letter would limit use in 
     credit evaluation systems of certain types of information, 
     such as information regarding the number of inquiries about 
     the consumer made to a credit reporting company, and would 
     also restrict consideration of other types of information, 
     such as information about the consumer's personal credit 
     experiences with other creditors in credit decisions that 
     involve the interest rate on an account.
       The information gathered by credit reporting companies on 
     the borrowing and payment experiences of consumers is a 
     cornerstone of the consumer credit system in this country. 
     Experience indicates that access to the information assembled 
     by these companies and credit evaluation systems based on 
     that information have improved the overall quality and 
     reduced the cost of credit decisions while expanding the 
     availability of credit.
       Credit evaluation systems rely on information to measure 
     the credit risk posed by current and prospective borrowers. 
     In the process of credit evaluation, creditors seek to use 
     information that helps them better distinguish between good 
     and bad credit risks. The information items that receive 
     positive and negative weights in credit evaluation systems 
     are those that have demonstrated statistical usefulness in 
     this process.
       Consumers' performance on credit accounts as well as the 
     number and recency of certain types of inquiries to credit 
     reporting companies are credit criteria that are 
     statistically associated with creditworthiness in evaluative 
     systems that are used for credit granting and pricing. 
     Records of consumers' usage of, and payment performance on, 
     credit accounts with other creditors are fundamental building 
     blocks for evaluations of creditworthiness. For example, 
     where a creditor commits to allow a consumer to make 
     purchases or obtain cash advances from time to time on a 
     revolving line of credit, the consumer's performance on other 
     credit accounts can well presage the credit risk outlook for 
     the creditor's own account. Similarly, an upsurge in recent 
     inquiries could indicate that a borrow in financial distress 
     is seeking to gain access to more credit. Thus, restrictions 
     on the use of information about certain inquiries or 
     restrictions on considering the experience of consumers in 
     using their credit accounts will likely increase overall risk 
     in the credit system, potentially leading to higher levels of 
     default and higher prices for consumers. Even with higher 
     prices for credit, elevated levels of default may raise risk 
     levels for credit-granting institutions.
       In sum, in deciding whether to restrict the use of certain 
     information in credit evaluations, the Congress should be 
     aware that such restrictions are likely to diminish the 
     effectiveness of statistical systems that have played a 
     significant role in reducing the overall costs of credit and 
     widening its availability.
       I hope these comments are useful.
           Sincerely,
                                                   Alan Greenspan.

  Mr. SANDERS. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
New York (Mrs. Maloney), the famous author of the Maloney amendment.
  Mrs. MALONEY. Mr. Chairman, I thank the gentleman for yielding me

[[Page 21777]]

this time, and I thank the gentleman from Alabama (Mr. Bachus) and the 
gentleman from Ohio (Mr. Oxley) and the gentleman from Massachusetts 
(Mr. Frank) for their extraordinary leadership on this important bill. 
And I thank them for supporting my disclosure amendment which will 
require conspicuous disclosure on credit reports and all credit papers 
of pricing items and techniques and strategies.
  But at the same time, I continue to be very, very troubled by some 
pricing strategies used by certain companies, and I believe that the 
Sanders amendment provides a needed reform.
  The amendment affects how credit card companies use information from 
credit reports to increase interest rates on their customers. This 
devious practice is known as ``bait and switch,'' where a consumer's 
low interest rate may be increased to 20 percent or higher simply 
because they may have taken out a new mortgage or some other liability. 
A recent New York Times article documented just such a case where an 
Illinois doctor had his rate go from 6.2 percent to over 16 percent 
when he took out a mortgage.
  The amendment merely allows the consumer a window of 60 days before 
their rates are increased, in the event they were on a vacation or got 
sick or missed a payment or were experiencing some type of short-term 
financial difficulty.
  I have met with a large number of industry representatives on this 
issue. Some company practices are already close to the standard of this 
bill and some are not. Congress has established some minimum consumer 
protections in other instances where necessary for the credit card 
industry such as the $50 maximum liability for lost cards. I believe 
this amendment sets a modest floor for the industry's practices above 
which there is an abundance of room for different companies to take 
different approaches and compete in the free market.
  Mr. Chairman, I support this amendment.
  Mr. OXLEY. Mr. Chairman, I am pleased to yield 2 minutes to the 
gentlewoman from Florida (Ms. Ginny Brown-Waite).
  Ms. GINNY BROWN-WAITE of Florida. Mr. Chairman, I am opposed to this 
amendment for a couple of reasons. I too serve on the Committee on 
Financial Services where this amendment was defeated by a two to one 
margin. The Maloney compromise amendment which came up seemed 
reasonable. It does give disclosure, and I think that that certainly is 
a good warning to the consumer.
  Mr. Chairman, one of the previous speakers mentioned a dispute, if 
you are disputing an item on your credit card statement, that is 
something that is put into abeyance, so that would not affect your 
credit rating. If we were to pass this amendment, I believe that all 
consumers would be harmed, because there would be higher costs of 
credit nationwide.
  When a credit card is issued, it is based upon a snapshot in time. As 
the picture changes, obviously, we need to have the companies remain to 
have that kind of flexibility that they have right now. This is really 
an issue of credit risk and creditworthiness; and as various occasions 
arise in one's life that they may be overextending themselves, then 
certainly the credit card company deserves to have the right to make 
those appropriate changes.
  Mr. SANDERS. Mr. Chairman, I yield myself such time as I may consume.
  The sides on this debate are very clear. One side are the credit card 
companies and the very large banks who are making huge profits from 
their consumers and, in some cases in our low-interest moment, right 
now, who are charging 25 or 29 percent a year interest rates. In other 
words, they are ripping off the American people.
  On the other side of this debate and supporting this amendment, are 
virtually every major consumer organization in America that is saying 
enough is enough. If people pay their bills on time every month, they 
should not see their interest rates double or triple. The chairman 
mentioned that there was bipartisan opposition to my amendment. He was 
right. But as he knows, there was bipartisan support for this 
amendment, including the gentleman from Alabama (Mr. Bachus), who was 
very articulate and supportive of this amendment as chairman of the 
relevant subcommittee.
  Let me simply conclude by saying this: the American people are sick 
and tired of being ripped off by credit card companies. When they pay 
their bills every month on time, they should not see their interest 
rates soar. I would urge the Members of this body, in a bipartisan way, 
to support the American consumer and pass the Sanders amendment.
  Mr. Chairman, I yield back the balance of my time.
  Mr. OXLEY. Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN pro tempore (Mr. Ryan of Wisconsin). The question is on 
the amendment offered by the gentleman from Vermont (Mr. Sanders).
  The question was taken; and the Chairman pro tempore announced that 
the noes appeared to have it.
  Mr. SANDERS. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN pro tempore. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from Vermont (Mr. 
Sanders) will be postponed.


                 Amendment No. 16 Offered by Mrs. Kelly

  Mrs. KELLY. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 16 offered by Mrs. Kelly:
       Page 44, after line 22, insert the following new 
     subsection:
       (c) Regulatory Authority to Adjust Report Distribution 
     Schedules in Times of Request Spikes.--Section 621 of the 
     Fair Credit Reporting Act (15 U.S.C. 1681s) is amended by 
     inserting after subsection (g) (as added by section 702(e) of 
     this Act) the following new subsection:
       ``(h) Regulatory Authority to Adjust Report Distribution 
     Schedules in Times of Request Spikes.--
       ``(1) In general.--If the Federal Trade Commission and the 
     Board of Governors of the Federal Reserve System determine 
     that consumer reporting agencies have been temporarily 
     overwhelmed with requests for disclosures of consumer reports 
     under section 612(e) beyond their capacity to deliver such 
     reports in a timely fashion, the Commission and the Board, by 
     order, may implement such measures as the Commission and the 
     Board determine to be necessary for a limited time to regain 
     equilibrium between the ability of the agencies to disclose 
     consumer reports and consumers demands for such reports.
       ``(2) Protection for emergency and time-sensitive 
     requests.--In issuing any order under paragraph (1), the 
     Federal Trade Commission and the Board of Governors of the 
     Federal Reserve System shall ensure that, during the 
     effective period of any such order, creditors, other users, 
     and consumers continue to have access to consumer credit 
     reports on a time-sensitive basis for specific purposes, such 
     as home purchases or suspicions of identity theft.''.

  The CHAIRMAN pro tempore. Pursuant to the order of the Committee of 
today, the gentlewoman from New York (Mrs. Kelly) and a Member opposed 
each will control 10 minutes.
  The Chair recognizes the gentlewoman from New York (Mrs. Kelly).
  Mrs. KELLY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, while this bill contains good consumer protections, my 
concern is that if free credit reports are extended to consumers, then 
there will be an unquestionable strain on the system. Unfortunately, 
the current system is not yet equipped to deal with overwhelming 
requests for credit reports that may result from offering free credit 
reports or any other extraordinary events. Consumers who have an 
identified need to access their file could find their request lost in 
an overburdened system. This will undoubtedly reduce service levels 
that could otherwise be dedicated to helping consumers who do have a 
concern about their files and need to have information quickly.
  After holding several hearings on the issue of identity theft, my 
concern is that large numbers of people simply looking for information 
could result in a chaotic shock to the system that would be ripe then 
for fraud and difficult to detect criminal behavior.

[[Page 21778]]



                              {time}  1815

  In the full committee I offered an amendment to ensure consumers' 
requests are accommodated by alleviating burdens on credit bureaus as 
the new law is implemented. I am pleased we have included a lot of this 
language in the manager's amendment, and as a result, the underlying 
bill now directs regulators as they construct a system for 
implementation to take into consideration potential spikes in the 
volume of requests for first year of the legislation. It is a 
tremendous first step, but I do not feel it is enough.
  The amendment I am offering now builds on the manager's amendment and 
simply gives regulators the authority to respond on a temporary basis 
to the needs of consumers when credit bureaus are overwhelmed with 
requests after the 1-year implementation.
  If the regulators determine it is necessary to exercise this 
authority, the amendment also explicitly states that their temporary 
approach must maintain consumer access to credit reports for emergency 
or time-sensitive requests. Including incidents of home purchases and 
suspected identity theft. Without the flexibility that this amendment 
provides, customer service may decline as credit bureaus become 
overwhelmed with requests under extenuating circumstances. By giving 
regulators the authority to mitigate in these instances, credit bureaus 
would be able to devote time and attention that each request deserves.
  I want to thank both the chairman and ranking member for including 
some language in the manager's amendment on the first year of 
implementation, but this amendment would complete that work. It is a 
straightforward approach to a significant problem and I urge colleagues 
to support the amendment that will benefit millions of Americans who 
need prompt access to their credit reports.
  Mr. Chairman, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I claim the time in 
opposition to the amendment.
  The gentlewoman correctly described what happened when the 
gentlewoman raised this issue in committee and we had a discussion of 
it and I agreed to the substance in the first year. And yes, in the 
manager's amendment we have, I think, a very good version of the 
amendment that she had introduced in committee because when you are 
doing something like this, there is often a problem in the transition. 
And the gentlewoman is correct that her initiative, we have managed the 
problem of the transition, namely, we have given to the regulators, in 
this case, primarily the Federal Trade Commission, with some 
participation from the Federal Reserve, the ability to do it within the 
first year.
  But I could not agree to making that a permanent feature in the way 
in which we now have because, for instance, some of the credit 
reporting agencies might be responsible and gear up for this. I do not 
want to reward those that might not do it. I think it is very 
reasonable to say in the first year, and it is also the case when you 
go from not having this right to having the right, yes, you can expect 
there to be a slew of first-time requests. But after the first year 
there is no reason to think that there is going to be this kind of 
backlog and a reasonable company ought to be able to manage that.
  If something should turn out later down the road to be an 
unanticipated problem, we have the capacity to deal with it, but I 
think it would weaken this if we were now to say to the regulators, in 
effect, on an ongoing basis, they could suspend this indefinitely, 
suspend this right for a lot of people. So while I supported and was 
glad to the 1-year transition issue, it does seem to me to go much 
further and we had and this was a process of give and take, we had 
agreed I thought on free credit reports as a basic rule. I must say 
that on our side and in many other places, giving the regulators an 
ongoing right to suspend what we have advertised as a new right beyond 
the transition year is very troubling and I would find it very 
difficult if this were to be included.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. KELLY. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
Florida (Ms. Ginny Brown-Waite).
  Ms. GINNY BROWN-WAITE of Florida. Mr. Chairman, serving on the 
Committee on Financial Services has been a challenge at times and 
certainly a great pleasure. And I want to thank the gentleman from Ohio 
(Mr. Oxley) for his leadership in championing the bill that we have 
before us.
  The Kelly amendment, I believe, is a very worthwhile amendment. As 
free credit reports are extended to consumers, there will be an 
unquestionable strain on the system. Unfortunately, the system is not 
yet equipped to deal with the overwhelming requests for credit reports. 
It may result from offering free credit reports or other extraordinary 
events that may occur as people begin to request these free credit 
reports and overload the system.
  Consumers who have identified the need to access their file will find 
their requests lost in an overburdened system. That will reduce service 
levels that could be dedicated to truly helping consumers who do have a 
concern about their files.
  Yes, there is language in the manager's amendment that directs 
regulators as they construct a system for implementation to consider 
potential spikes in the volume of requests for their first year of 
implementation. The Kelly amendment, I believe, builds on this language 
and simply gives regulators the authority to respond on a temporary 
basis to the needs of consumers when credit bureaus are overwhelmed 
with requests.
  If the regulators determine it is necessary to exercise this 
authority, the amendment also explicitly states that their temporary 
approach must maintain consumer access to credit reports for emergency 
or very time-sensitive requests, including instances of home purchases 
and suspected identity theft. Without this flexibility that this 
amendment offers, customer services will undoubtedly decline as credit 
bureaus become overwhelmed with these requests. By giving regulators 
the authority to mitigate in these instances, credit bureaus will be 
able to devote better time and attention to those needing the requests.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself 1 minute.
  One point, I recognize there could be a spike problem in the 
beginning. We should underline with regard to these requests, we are 
talking here about the problem of sending it out. Nobody has to send 
out a report that does not exist.
  In other words, we are not imposing on the credit reporting agencies 
the duty of compiling the report anew. And I think that is something we 
ought to take into account. The question is simply whether after that 
first year they will be flooded, and the request is to simply send a 
report that exists. If no report exists, no obligation exists. And I do 
not think that the problem after the first year at this point is going 
to be so clearly a problem that we ought to write in this suspension. I 
am prepared to look at it later, but I think it would be a serious 
error at this point.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. KELLY. Mr. Chairman, does the gentleman have any further 
speakers on this issue?
  Mr. FRANK of Massachusetts. Just myself to close, as we have the 
right to do.
  Mrs. KELLY. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I believe this is an important work that I think we 
need to address before any conference report is finished. I think with 
an agreement with our chairman and with an agreement, hopefully, that 
was just stated by our ranking member, I think that I am willing to 
hopefully work with him in the spirit of cooperativeness here on the 
floor today.
  Mrs. KELLY. Mr. Chairman, I ask unanimous consent to withdraw my 
amendment.
  Mr. FRANK of Massachusetts. Reserving the right to object, I would 
point out to the gentlewoman, the last time she and I had this 
conversation the result was a pretty good amendment to the manager's. I 
think we have a pretty good track record of working together.

[[Page 21779]]

  Mr. Chairman, I withdraw my reservation of objection.
  The CHAIRMAN pro tempore (Mr. Ryan of Wisconsin). The amendment is 
withdrawn.
  Mr. EHLERS. Mr. Chairman, I move to strike the last word.
  Mr. Chairman, I rise in order to enter into a colloquy with the 
distinguished chairman of the Committee on Financial Service.
  Mr. Chairman, constituents in my district have brought to my 
attention a problem regarding the inability of certain people to obtain 
a credit rating from a credit bureau, even when they are very 
creditworthy. This is an extremely troublesome issue given the 
importance of a credit rating in our society today. It is very 
difficult to function without credit. From placing a deposit when 
renting a car, to staying in a hotel to getting a mortgage for a home, 
people rely on credit every day. Indeed, credit bureaus wield a great 
deal of influence in this respect.
  Unfortunately, the rules and formulas they apply can yield unjust and 
nonsensical results. For example, visiting scholars at our colleges and 
universities or other temporary workers from overseas who have good 
credit in their home countries, often industrialized countries with 
advanced credit and accounting systems, often cannot obtain credit when 
coming to America. This prevents them from obtaining a credit card 
which is so vital for proper functioning in this society.
  As another example, one woman in my district worked overseas for 
about 10 years during which time her credit cards expired and she 
stopped transacting business with credit cards from America. Upon 
returning she had a nearly $20,000 cash balance in a bank account but 
she was unable to get a credit bureau to rate her. She could not get a 
mortgage for a house, a credit card or even a retail store charge 
account. Despite her many years of good credit rating, this lull in 
credit usage eliminated her creditworthiness in the eyes of the number 
crunchers at the credit bureaus.
  At the same time, credit card companies turn around and grant credit 
cards almost willy nilly to high school or college students with no 
credit history at all. These kinds of situations are unfair given the 
importance of a credit rating, good or bad, for so many financial 
transactions. It just does not make sense in many situations that some 
creditworthy people cannot get a credit rating at all despite having 
adequate cash resources or a positive history in another country.
  Mr. Chairman, I would appreciate the time and effort of you and the 
committee to investigate whether a solution to these problems can be 
found.
  Mr. OXLEY. Mr. Chairman, will the gentleman yield?
  Mr. EHLERS. I yield to the gentleman from Ohio.
  Mr. OXLEY. Mr. Chairman, I understand the gentleman's concern and we 
have had some discussion about it. I would be pleased to work with him 
to explore what might be done to remedy these situations. It is 
certainly unfortunate that under our current system some situations 
like the ones you mentioned do arise preventing consumers, who are low 
credit risks, from obtaining credit quickly.
  I look forward to working with the gentleman from Michigan (Mr. 
Ehlers) to see if we can address the legitimate concerns he raises.
  Mr. EHLERS. Reclaiming my time, I thank the chairman for his 
assistance and I look forward to working with him and the Committee on 
Financial Services on this important issue.


                Amendment No. 1 Offered by Mr. Kanjorski

  Mr. KANJORSKI. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 1 offered by Mr. Kanjorski:
       Page 7, strike line 13 and all that follows through line 24 
     and insert the following (and conform the table of contents 
     accordingly):

     SEC. 101. 9-YEAR EXTENSION OF UNIFORM NATIONAL CONSUMER 
                   PROTECTION STANDARDS.

       Paragraph (2) of section 624(d) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681t(d)(2)) is amended to read as 
     follows:
       ``(2) shall not apply after December 31, 2012.''.

  The CHAIRMAN pro tempore. Pursuant to the order of the Committee of 
today, the gentleman from Pennsylvania (Mr. Kanjorski) and the 
gentleman from Ohio (Mr. Oxley) each will control 10 minutes.
  The Chair recognizes the gentleman from Pennsylvania (Mr. Kanjorski).
  Mr. KANJORSKI. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I strongly support the Fair and Accurate Credit 
Transactions Act. Nevertheless, I believe that we should alter the 
legislation to sunset the key elements of the bill at the end of 2012.
  The gentlewoman from New York (Mrs. Maloney) also joins me in 
sponsoring this pragmatic and reasonable amendment.
  In June, I helped to introduce H.R. 2622 to extend the expiring 
provisions of the Fair Credit Reporting Act and to improve consumer 
protections. In my view, the 1996 amendments to create a national 
credit reporting system have expanded access to credit, lowered the 
price of credit, and accelerated decisions about getting credit. To 
continue this record of achievement, we need to extend the expiring 
provisions of this law before the end of the year.
  While I support the FACT Act, I also continue to believe that we 
should amend the bill to include a 9-year sunset. As currently drafted, 
the legislation would permanently extend the seven expiring preemptions 
of State law within the Fair Credit Reporting Act. In my view, we 
should sunset the Uniformed National Consumer Protections Standards 
contained in H.R. 2622 at the end of 2012, and the Kanjorski-Maloney 
amendment accomplishes this narrow objective. Unlike current law, our 
amendment would not specifically allow States to enact additional 
credit reporting standards in the preempted areas after the 9-year 
sunset.
  In referring to the U.S. relationship with the Soviet Union, Ronald 
Reagan once said that we should ``trust but verify.'' We have adopted a 
similar approach with H.R. 2622. We should trust that the participants 
in the credit reporting industry will continue to work to comply with 
the law but verify that the consumers continue to have appropriate 
protections with respect to their credit in years ahead.
  Mr. Chairman, a sunset provision provides industry with incentive to 
continue to work to advance the interest of consumers. Moreover, 
without a sunset, we may well have trust until some major problem 
causes chaos in the credit reporting industry and forces Congress to 
revisit the issue in a haphazard way.

                              {time}  1830

  Furthermore, a sunset provision will allow us to evaluate the 
effectiveness of our credit-reporting programs and policies within a 
predetermined time frame and force us to decide whether to alter them. 
In fact, the sunset imposed by Congress in 1996 has allowed us today to 
review in a methodical and systematic manner the success of the current 
law and make necessary improvements to it to reflect changes in the 
financial system.
  Identity theft, for example, has dramatically increased in recent 
years. Technology has also changed greatly in the last 7 years. Mr. 
Chairman, the FACT Act before us today addresses both of these 
developments. It, therefore, makes sense to ask the 112th Congress to 
review and reconsider our work in the 108th Congress and make further 
improvements to our credit reporting laws. A sunset at the end of 2012 
provides sufficient time for industry to implement the reforms called 
for in this bill, establishes sufficient surety for our financial 
marketplace, and allows for new issues to arise on the public policy 
landscape.
  In closing, Mr. Chairman, I encourage my colleagues to make a good 
bill even better by supporting the sensible and practical Kanjorski-
Maloney amendment to sunset H.R. 2622 at the end of 2012.
  Mr. Chairman, I reserve the balance of my time.
  Mr. OXLEY. Mr. Chairman, I yield 4 minutes to the gentleman from Ohio 
(Mr. Tiberi).

[[Page 21780]]


  Mr. TIBERI. Mr. Chairman, it is a pleasure to speak to this amendment 
as well as to the legislation at hand. I am opposing the amendment. The 
amendment obviously would eliminate the uniform standards established 
by the FCRA in the future in 9 years.
  Congress did something very good in 1996, and it did so voluntarily. 
There was not anything about to expire with FCRA in 1996, and Congress 
established a national uniform standard for FCRA in 1996 that 
recognized, quite competently, that this was an experiment, an 
experiment that should last and be tested over a 7-year period. That 7-
year period is coming to an end on January 1 of 2004.
  Over 100 witnesses through eight hearings loudly, clearly told our 
committee, Democrats and Republicans, that what we have had over the 
last 7 years and what Congress did in 1996 was quite successful. It has 
been successful for our economy, but, most importantly, successful for 
American consumers.
  We are now, as American consumers, leaders of the world as far as 
credit goes, mortgage credit, consumer credit. And FCRA and the 
exemptions, the eight exemptions did that.
  What we do not want to do is do this again in 9 years because what we 
have seen in the last 7 years and what was done in 1996 was done 
correctly.
  Now, ladies and gentlemen, the committee rejected this amendment. We 
heard from, as I said, over 100 witnesses. Three of those witnesses 
included the Federal Trade Commission chairman, Chairman Greenspan, and 
Treasury Secretary Snow. They, too, believe this is the right way to go 
and support this legislation in its current form.
  Now, there has been discussion on the floor today about what has been 
happening on the left coast and what has been happening in their 
legislature and what has been happening with their Governor who is in 
the process of being recalled. Well, this legislation is a great piece 
of legislation. I am afraid that because of their action, this Congress 
will be dealing with issues because of the California legislature in 
years to come.
  This legislation today and what has happened in the last month out 
West demonstrate why this piece of legislation in its current form 
without the current amendment being offered is the right way to go.
  The arguments that Congress will not address or will not be able to 
address, the problems or potential problems in the future without this 
amendment are unfortunately baseless because Congress can address 
issues pertaining to FCRA or issues pertaining to identity theft in 2 
years, 3 years, 4 years, or 5 years.
  Members of the House, the amendment is supported by some because they 
hope that the national uniform provisions will expire.
  The national standard is good for consumers. It is good for America. 
This is a good bill drafted by the gentleman from Ohio (Chairman Oxley) 
and the gentleman from Alabama (Mr. Bachus). I support the bill. I urge 
my Members of the House and the Republican and Democrat side to reject 
the amendment from my learned colleague.
  I thank the Members of the House for supporting this bill.
  Mr. KANJORSKI. Mr. Chairman, I yield such time as she may consume to 
the gentlewoman from New York (Mrs. Maloney).
  Mrs. MALONEY. Mr. Chairman, I thank the gentleman for yielding me 
this time.
  Mr. Chairman, I am very pleased to be an original cosponsor of the 
Fair Credit and Reporting Act. Over the course of several months the 
committee conducted comprehensive hearings and produced a balanced bill 
that preserves the national credit market and enhances consumer 
protections.
  I do not think any reasonable person would question the fact that the 
engine driving these improvements is the sunset provision put in the 
original Fair Credit and Reporting Act in 1996 that expires at the end 
of this year. Without the present sunset, consumers would not be 
getting free credit reports or access to their scores as they will be 
in this underlying bill.
  Without the sunset, the Congress would not be forced to conduct 
months of hearings on the fundamental questions of credit report 
accuracy, identity theft, the privacy of medical records, and access to 
credit reports. These are major, all-important new rights that the 
underlying legislation grants to consumers that result directly from 
the current sunset.
  In offering this amendment today, the gentleman from Pennsylvania 
(Mr. Kanjorski) and I seek to strike a balance. Nine years ensures that 
the legislation will be revisited, but it grants the financial services 
industry a prolonged period of time during which it will not have to be 
concerned about major changes of law that will affect company 
operations.
  I applaud my colleague, the gentleman from Pennsylvania (Mr. 
Kanjorski), for being consistent in his desire to sunset the programs 
Congress creates. I think this approach is particularly important on 
this issue and on the legislation before us tonight.
  Nine years ago, the world was a very different place. Technology has 
completely changed the manner our constituents access financial 
services in that time, and things are likely to be just as different 9 
years from now; and it is appropriate that Congress revisit this law at 
that point.
  For that reason and the others illustrated by my colleague, I deeply 
and truly do believe that this amendment is a very important one, and I 
strongly support it.
  Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentleman from 
Alabama (Mr. Bachus).
  Mr. BACHUS. Mr. Chairman, the gentleman from Ohio (Mr. Tiberi) spoke 
in opposition to this amendment and I think basically said everything 
that needed to be said on this particular amendment; and I think the 
most important thing he said is that Congress has demonstrated, because 
they have done it in the past, they are free to revisit and fine-tune 
FCRA anytime they wish; and they did that in 1996, even though there 
was not an impending deadline.
  Far more important is what we learned in our hearing and how good the 
national credit reporting system is to our Nation. I am not sure that 
anybody disagrees with that, that anybody thinks that it ought to be 
experimented with, that it ought to expire in 9 years. It is very good 
for consumers. It has been particularly good in democratizing credit 
and extending credit to middle- and low-income Americans; and to limit 
that to 9 years, we do not do that with the Community Reinvestment Act. 
We do not do that to the Equal Credit Opportunity Act. We do not do 
that to our other acts which protect consumers, and this act is for the 
benefit of consumers and it protects consumers.
  Let me conclude by saying the gentleman from Ohio (Mr. Tiberi) is one 
of our younger members of our committee, an outstanding member. It is 
just one example of the many young members that we have on our 
committee that have really had real input in this bill. I want to 
commend all of them.
  I will close by commending the gentleman from Ohio (Mr. Oxley) giving 
me the opportunity to work on this bill, for making it a priority, for 
realizing early that we needed multiple hearings. I would also like to 
commend these people: the gentleman from Massachusetts (Mr. Frank), the 
gentlewoman from Oregon (Ms. Hooley), the gentleman from Kansas (Mr. 
Moore), the gentleman from Ohio (Mr. LaTourette), the gentlewoman from 
Illinois (Mrs. Biggert), and other members of the committee.
  Mr. KANJORSKI. Mr. Chairman, can I inquire as to the time remaining.
  The CHAIRMAN pro tempore (Mr. Ryan of Wisconsin). The gentleman from 
Pennsylvania has 3\1/2\ minutes remaining. The gentleman from Ohio (Mr. 
Oxley) has 4\1/2\ minutes remaining.
  Mr. KANJORSKI. Mr. Chairman, I yield myself such time as I may 
consume. I do not think we need our 3\1/2\ minutes. I have no other 
speakers, Mr. Chairman.
  Mr. Chairman, I guess I want to first say one of the privileges of 
serving in

[[Page 21781]]

the House of Representatives is the opportunity to meet the Members of 
Congress on the other side of the aisle, and one of the Members of 
Congress that has been very instrumental in this bill is my good 
friend, the gentleman from Alabama (Mr. Bachus); and he and I do not 
agree on a lot of things philosophically, but he represents the type of 
qualities that this House needs more of. So it has been such a pleasure 
to see him cochair this subcommittee and accomplish the almost 
unanimous consent of this committee on this piece of legislation, and 
it goes a great deal to his innate abilities and his just Southern 
gentlemanliness of how to accomplish a good piece of legislation. So I 
want to compliment him.
  I disagree on the proposition that it hurts to sunset things. I think 
my colleague and I probably agree and have voted for sunset provisions. 
I am probably on most of the committees I serve on known as the sunset 
person. I like to sunset everything. The reason I like to sunset 
everything is it forces the Congress of the United States to come back, 
reevaluate, restudy and bring up to date needs that otherwise are not 
driven by public recognition or by commonality in the public force to 
cause legislation to be addressed.
  In my opening remarks, I said that it is important that we trust 
industry, and I think as a Member of my side of the aisle what I want 
to say is that I have met with all of the interested parties in the 
reporting industry and the financial industry, and I have found them 
all working toward a common effort to increase credit, to increase 
accessibility to credit, and increase efficiencies to benefit 
consumers. So we have no disagreements on that.
  Between now and 2012 there will be changes in technologies and 
changes for needs, and in my opening remarks I also said I like the 
idea of trust but verify. There will be some elements of the society 
that want to take advantage or not comply with the act. It will give us 
an opportunity to evaluate that and find out methods that we can reward 
good practitioners of fair credit and at least bring into the limelight 
bad practitioners of good credit.
  I just do also want to take one moment to respond to my gentleman 
friend from Ohio. He referred to the left coast, and I am not sure, was 
he looking north or looking south because he may have been attacking my 
hometown. I could be on the left coast if one is looking south.
  The comment I want to make to my colleague is there is a fundamental 
illogic in his argument. He said that the left coast is having this 
recall and they are, and he seems to favor the recall. The recall 
probably is an element of sunset provisions, that is, the opportunity 
to require a revesting out there of an election of a Governor.

                              {time}  1845

  So if my colleague is in favor of not having sunsetting and not 
having recalling, then I suggest he talk to one of his fellow 
colleagues on his side, because I think he brought this about with the 
argument that the people should be protected with the right to recall.
  I do not favor recall, but in the Congress I do favor a sunsetting 
provision because it will give us the opportunity to reevaluate, 
rejudge, and have oversight and correct some mistakes made in the 
initial legislation. So I urge all my colleagues on the Republican 
side, the Democratic side, and those that are Independent, in the 
middle, to support this amendment.
  Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume, 
and in conclusion I would say to my good friend from Pennsylvania that 
this is a philosophical difference. Clearly, he makes some interesting 
arguments. The amendment was, in fact, rejected in the committee.
  In fact, FCRA, as other Members have said on both sides of the aisle 
today, has been a very successful piece of legislation. It has provided 
consistency, reliability, certainty, and uniformity in our credit laws. 
And that has had enormous consequences for our economy and for 
consumers, as has been chronicled time and time again during the period 
of this debate.
  I would suggest that this act that we are now seeking to make 
permanent has stood the test of time for 7 years, and it is now time 
that we make this permanent so that credit agencies, people who get 
credit, issuers, furnishers, everybody concerned knows what the rules 
are, knows that those rules are effective and work well, and that they 
will be permanent.
  So I respectfully oppose the Kanjorski amendment.
  Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN pro tempore (Mr. Ryan of Wisconsin). All time for debate 
has expired. The question is on the amendment offered by the gentleman 
from Pennsylvania (Mr. Kanjorski).
  The question was taken; and the Chairman pro tempore announced that 
the noes appeared to have it.
  Mr. KANJORSKI. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN pro tempore. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from Pennsylvania 
(Mr. Kanjorski) will be postponed.


                 Amendment No. 3 Offered by Mr. Inslee

  Mr. INSLEE. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 3 offered by Mr. Inslee:
       Page 80, after line 5, add the following new title (and 
     conform the table of contents accordingly):

                   TITLE VIII--TECHNICAL CORRECTIONS

     SEC. 801. AMENDMENTS RELATING TO SECTIONS 625 AND 626 OF THE 
                   FAIR CREDIT REPORTING ACT.

       (a) Section 625.--Section 625(h) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681u(h)) is amended by striking 
     ``Committee on Banking, Finance and Urban Affairs'' and 
     inserting ``Committee on Financial Services''.
       (b) Section 626.--Section 626 of the Fair Credit Reporting 
     Act (15 U.S.C. 1681v) is amended--
       (1) in subsection (b), by striking ``a supervisory official 
     designated by''; and
       (2) by adding at the end the following new subsections:
       ``(f) Reports to the Congress.--On a semiannual basis, the 
     head of a Federal agency authorized to conduct investigations 
     of, or intelligence or counterintelligence activities or 
     analysis related to, international terrorism shall fully 
     inform the Permanent Select Committee on Intelligence and the 
     Committee on Financial Services of the House of 
     Representatives, and the Select Committee on Intelligence and 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate concerning all requests made pursuant to subsections 
     (a).
       ``(g) Payment of fees.--A Federal agency authorized to 
     conduct investigations of, or intelligence or 
     counterintelligence activities or analysis related to, 
     international terrorism shall, subject to the availability of 
     appropriations, pay to the consumer reporting agency 
     assembling or providing report or information in accordance 
     with procedures established under this section a fee for 
     reimbursement for such costs as are reasonably necessary and 
     which have been directly incurred in searching, reproducing, 
     or transporting books, papers, records, or other data 
     required or requested to be produced under this section.''.

  Mr. OXLEY. Mr. Chairman, I reserve a point of order.
  Mr. INSLEE. Mr. Chairman, we have an amendment that will cure a 
modest imperfection that occurred essentially due to the PATRIOT Act. 
It is something that I think actually may have been an oversight, but 
it is something we would like to take a shot at solving today.
  Mr. Chairman, while the FBI for years has been allowed to have access 
to our credit reports, we have wisely included certain conditions in 
the law about the FBI being able to dial up and get access to citizens' 
credit reports. There is a requirement that there be a sign-off by the 
Director or someone appointed by the Director, and that there be a 
report to Congress and that there be payment to the credit reporting 
agency for the costs associated with sharing the information. These are 
reasonable conditions and requirements for privacy concerns.
  Unfortunately, when we adopted the PATRIOT Act, we did not include 
those conditions, those privacy protections, when it applied to the 
ability now for the Treasury Department and a host of other 
investigatory agencies who can now essentially call up and get 
citizens' reports. So our amendment would

[[Page 21782]]

simply require the same privacy protections that apply to the FBI's 
getting access to our credit reports to other investigatory agencies.
  We understand that there is a point of order raised on this, but we 
have brought this to the Chair's attention; and we hope as this matter 
moves along, the chairman will look for a way to solve this problem at 
a later date as this legislation matures. It is very solvable, it needs 
to be resolved, and it should not be controversial. So we hope that 
that will occur.
  Mr. Chairman, I ask unanimous consent to withdraw the amendment.
  The CHAIRMAN pro tempore. Is there objection to the request of the 
gentleman from Washington?
  There was no objection.
  The CHAIRMAN pro tempore. The amendment is withdrawn.


         Amendment No. 6 Offered by Mr. Frank of Massachusetts

  Mr. FRANK of Massachusetts. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 6 offered by Mr. Frank:
       Page 44, strike lines 9 and 10 and insert ``Section 612 of 
     the''.
       Page 44, beginning on line 14, strike ``described in 
     section 603(p)'' and insert ``that compiles and maintains 
     files on consumers on a nationwide or regional basis''.
       Page 44, strike line 18 and all that follows through line 
     22.

  The CHAIRMAN pro tempore. Pursuant to the order of the Committee of 
today, the gentleman from Massachusetts (Mr. Frank) and a Member 
opposed each will control 10 minutes.
  The Chair recognizes the gentleman from Massachusetts (Mr. Frank).
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself 2 minutes.
  Mr. Chairman, there has been a good deal of self-congratulation on 
this bill, but some of it is not yet deserved. I hope after the 
adoption of this amendment it will be.
  We have congratulated ourselves on, among other things, providing 
under this amendment for free copies once a year of credit reports to 
consumers. Indeed, we had a colloquy with the gentleman from New York 
about the flood that was going to happen; and at one point in 
committee, language was adopted which did provide all consumers with 
free copies of all credit reports that might have been done on them.
  Then an amendment was adopted in committee, and I wish it had not 
been adopted, it was not by vote, it just happened, which substantially 
limited it. So as of now, as the bill stands, if this amendment is not 
adopted, consumers can get free copies of their credit reports, 
consumers in general, from only one of the three major national credit 
agencies. And that is a good thing, but there are an awful lot of 
specialized credit agencies. There are regional credit agencies. Not as 
many. Some that remain from previously. There are local credit 
agencies. My amendment does not cover them; I leave them out. They had 
been in the original bill, but I had agreed to a cutback. The cutback 
went much further than I thought we had agreed to.
  So what this amendment says is an individual should be able to get a 
free copy of their credit report from the national specialized credit 
agencies, and there are large numbers of national agencies. One of the 
most important is the Medical Information Bureau, and I have spoken to 
them. They have no objection to being in this requirement. They give 
medical information, which would be relevant. There is also 
ChoicePoint, CheckSystems, CLUE, and Landlords United. A lot of these 
national specialized agencies have to do with landlord-tenant agencies.
  So if this amendment does not pass, please do not try to take credit 
for passing a bill that generally gives consumers a right to a free 
credit report. It gives consumers a right to a limited pool of free 
credit reports, those from the major national credit agencies. But a 
large number of the agencies which compile credit on people will be 
excluded from the bill, and I think that would be a severe error and a 
misrepresentation.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BAKER. Mr. Chairman, I claim the time in opposition.
  The CHAIRMAN pro tempore. The gentleman from Louisiana (Mr. Baker) is 
recognized for 10 minutes.
  Mr. BAKER. Mr. Chairman, I yield myself such time as I may consume, 
and I rise in opposition to the gentleman's amendment.
  During the course of the committee deliberations, I was concerned 
about the consequences of the mandatory credit report obligation on 
those entities within communities which are basically small businesses. 
The three principal national credit reporting entities are responsible 
for in excess of 95 percent of all credit reporting activities, 
financial in nature, within the country.
  I offered an amendment in committee which I represented to the 
gentleman that would affect what we deemed to be small reporting 
agencies in nature, to which there was agreement in that principle. The 
effect of the amendment, subject to further review, though it was not 
the intent, was clearly to go beyond just the very small credit bureaus 
in the way in which the amendment was constructed. I then understood, 
by error, the intent of the amendment was better than I originally 
thought.
  Although I was aiming only at the very small credit bureaus, for 
which it would be an economic disadvantage of some significance for 
them to provide this level of free report and, furthermore, who are not 
now required under law to provide a free credit report for this reason, 
it also went to other entities, for example, MIB or other health-
related reporting entities under the broad definition of consumer 
reporting enterprises that also required them to provide the free 
credit report. By inadvertence, my amendment was a little broader in 
scope than I thought, but in principle and effect I agree with the 
consequences of my amendment.
  I support the gentleman's view that the three large credit-reporting 
entities, which conduct over 95 percent of the disclosure of financial 
matters of consumers, should be subject to this now new one additional 
reason for a provision of a free credit report. The adoption of this 
amendment, however, if the House were to accept the gentleman's 
position, would be to require all consumer-related reporting agencies, 
even the smallest, to provide this free credit reporting information 
even to their financial detriment.
  Although there was some disagreement in the construct of the 
amendment in the committee, I would still reserve my objection to the 
gentleman's amendment; and I think it is a policy matter for the House 
to determine whether we would accept any relief from the requirement 
for the free credit report or would we accept the gentleman's position 
to require all entities regardless of economic consequence to provide 
the mandated credit report.
  Mr. Chairman, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself 1 minute and 
would say first that the gentleman has correctly stated it. And, 
frankly, I relied when that amendment was offered on what he now 
concedes was a misinterpretation. That is not a good way to legislate. 
And I am disappointed that the gentleman is going to try to keep the 
advantage of that misunderstanding.
  Secondly, it is inaccurate to say that this amendment that I am now 
offering would cover everybody. I have agreed to exempt in this 
amendment the local credit agencies. I am talking about the national 
specialized ones. They are the primary difference between us.
  The gentleman acknowledges and he explained an amendment that I did 
not think and I guess he did not think covered people like MIB. We did 
not object to it. It was not carefully read. We accepted the 
description. He says through inadvertence it went too far. That 
happens. But I think it is frankly inappropriate in terms of our 
legislatively working together to insist on that, particularly since I 
am not trying to restore the original language. I am excluding the 
small ones.

[[Page 21783]]

  Mr. Chairman, what this does is this covers the few regional ones, 
but mostly it covers national specialized agencies which do not merit 
the description of those who are too poor.
  So I think, once again, if we reject this amendment, we have what the 
gentleman concedes is an inadvertent amendment that was adopted that 
excludes a number of agencies and we cannot say that it gives everybody 
free credit reports.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BAKER. Mr. Chairman, I yield myself 2 minutes.
  I simply point out in fairness to the gentleman that the discussion 
of regional reporting entities was not really a discussion point within 
the committee discourse. My concern was the economic consequences on 
the very small. And upon reflection of the impact of the amendment 
addressing the question of regionals and economic concerns, the 
arguments are the same.
  I still feel that the exemption that I am attempting to preserve in 
the bill is appropriate and understand the gentleman's philosophic view 
that all of these enterprises at the regional level should be required 
to provide the free report.
  Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
  Mr. BAKER. I yield to the gentleman from Massachusetts.
  Mr. FRANK of Massachusetts. Put aside the regionals. What about the 
national specialized agencies, like MIB? This amendment could be 
amended under the rules. An amendment could be offered to amend this, a 
second degree amendment. Would the gentleman agree to exclude the 
regionals and cover the specialized national ones?
  Mr. BAKER. Mr. Chairman, reclaiming my time, let me suggest this to 
the gentleman, in light of everyone here present and observing this. I 
will be most happy not to repeat the same mistake I made at the 
committee and agree with the gentleman that in fact a description and 
analysis of the specialties does result in the view that they are large 
enough and sufficient in scope; I will commit to work with the 
gentleman going forward.
  Mr. FRANK of Massachusetts. Where? This is the end of the bill.
  Mr. BAKER. Well, it will likely be in conference, I would suggest, 
because there will be no assurance that the bill we pass here will seek 
Senate approval or uniformity with the Senate.
  I would suggest to the gentleman that adopting here at the moment, 
without having a full listing of those specialty organizations, would 
be difficult for me to assess the effect. But I am not trying to 
obstruct the gentleman's interest and believe that the bill as 
constructed in its current form is appropriate.
  Mr. Chairman, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself 1 minute to 
express my extreme disappointment.
  I relied on an explanation the gentleman now acknowledges was 
erroneous when this amendment was adopted. The gentleman says it goes 
too far. I have offered to try to compromise. He now tells me that 
after the bill has passed, he will work with me. That offer is worth 
about as much as the explanation I got, apparently. And it may or may 
not be a conferencable item. I do not know whether the Senate will have 
any language in this.
  So I must express my extreme disappointment. This is not conducive to 
a cooperative working relationship, I must say to the gentleman from 
Louisiana. We tried to do this through negotiations in the manager's 
amendment; we have tried to repair this. And the gentleman has at every 
point said, no, I won because there was a misunderstanding, and that is 
it.

                              {time}  1900

  Mr. Chairman, I cannot consider that to be a reasonable offer to work 
together.
  Mr. Chairman, I yield 3 minutes to the gentleman from New York (Mr. 
Crowley).
  Mr. CROWLEY. Mr. Chairman, I thank the gentleman from Massachusetts 
(Mr. Frank) for yielding me this time.
  Mr. Chairman, I rise in strong support of the Frank amendment. As we 
have heard, the base bill would allow every American access to a free 
annual consumer report upon request from the three national credit 
reporting agencies, and I salute the provision, as does the ranking 
member.
  But as we all know, while the Fair Credit Reporting Act deals 
primarily with credit-reporting agencies, the underlying statute we are 
amending today through the FAIR Act deals with all consumer reporting 
agencies. These include credit investigative medical tenant reporting 
agencies, among many others.
  Unfortunately, this bill inadvertently limits consumers to requesting 
and reviewing only one free credit report annually from the three 
national reporting agencies, meaning this bill does not permit 
consumers to obtain free reports from hundreds of specialized national 
consumer reporting agencies that compile information on consumers for 
noncredit purposes.
  This provision is necessary in order to correct this oversight and 
ensure free annual consumer reports from all entities covered by the 
Fair Credit Reporting Act, whether they be credit agencies or other 
information-gathering agencies.
  We need to ensure that this legislation lives up to the spirit of 
what all of its supporters intended, including myself, that of allowing 
Americans access to all consumer reports compiled on them by 
information-reporting bureaus, not just credit reports, but medical 
reports and other reports about people's personal information.
  I do recognize that the Medical Information Bureau, which I have 
worked closely with, for their agreement to provide these free annual 
reports upon request, but even with this agreement, there are too many 
information-gathering agencies which are exempt and will remain 
unresponsive from these provisions without passage of this amendment.
  These consumer-reporting agencies include but are not limited to 
companies that compile consumer information relating to medical 
records, employment background checks, tenant screening, driving 
records, insurance claims, criminal records and check-writing history. 
In fact, in recent years, it has become evident that two companies, 
only two companies almost dictate which consumers can open checking 
accounts based upon the reports and scores they provide to financial 
institutions.
  These information gatherers must be included under the obligation to 
ensure free annual reports to individuals upon the consumer's request. 
This will ensure greater accuracy and transparency, what I believe is 
the basic goal of the underlying bill today.
  Everyone should support this amendment. It does not change the bill, 
but rather clarifies the intent of all of its supporters, of which I am 
one. I urge my colleagues to support this amendment.
  Mr. BAKER. Mr. Chairman, I yield myself 1 minute.
  Mr. Chairman, I wish to address the view of the gentleman with regard 
to the consequences of these determinations. The focus of the bill was 
to provide those individuals without financial resources or for just 
cause access to a credit report without having to pay for it.
  In our negotiations or discussions about resolution of the matter, I 
am willing and would support an amendment that would preserve that 
right for those protected classes under the bill to have access to a 
free credit report, regardless of the nature of that credit-reporting 
entity.
  What I did not want to require was a broad-based requirement for 
either the specialty or the small business credit reporting agency to 
be under a monetary obligation to provide all requesters a free credit 
report. I think that is a fair position, given my concerns about the 
economic impact on these business enterprises, and would be reluctant 
not to provide that measure of equity to the regional reporting 
agencies without understanding better the economic consequences.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield 2 minutes to the 
gentlewoman from Oregon (Ms. Hooley).

[[Page 21784]]


  Ms. HOOLEY of Oregon. Mr. Chairman, I rise in support of the Frank 
amendment to the Fair Credit Reporting Act. One of the things that 
happened in committee, and it is unfortunate because of a 
misunderstanding, all of a sudden we are restricting these free credit 
reports.
  One of the big deals about passing this bill was that everyone got a 
free credit report. The Frank amendment allows all consumers to obtain 
a free annual credit report from any nationwide consumer reporting 
agency. It eliminates the provision in the bill that restricts 
consumers to getting their free annual credit report from just three 
national consumer reporting agencies. The amendment also restores the 
right of consumers who are unemployed or on public assistance or 
believe they have been a victim of fraud to obtain a free credit report 
from any consumer reporting agency. Right now they can get that from 
all of the major credit reporting agencies. Under this bill, as it is 
currently written without this amendment, they will be restricted. They 
will only be able to get these free reports from local or regional 
consumer reporting agencies.
  I believe I speak for both sides of the aisle when I say it was never 
the intention of the Committee on Financial Services to strip away 
these rights that these disadvantaged groups have under current law, 
and these groups are already entitled to a free credit report from the 
national agencies. We should not be restricting access to credit 
reports for the disadvantaged, while at the same time, giving the rest 
of the Nation's consumers even more access to their credit information. 
This amendment will restore the additional access to credit information 
that these disadvantaged groups currently enjoy, and this amendment 
should have been part of Fair Credit Transaction Act from day one.
  Again, one of the primary intentions of this legislation was to 
increase access to information for all Americans, and by supporting the 
Frank amendment, we will be doing just that. I urge Members to vote yes 
on the Frank amendment.
  Mr. BAKER. Mr. Chairman, I yield 1 minute to the gentleman from Ohio 
(Mr. Oxley).
  Mr. OXLEY. Mr. Chairman, let me just say, having participated 
obviously in the markup and listening to the debate on the floor, I 
think all Members want to preserve the protected class. I do not think 
that is really an issue. Also, I think there is some concern that very 
small agencies ought to have some exemption from the free credit 
report.
  I would indicate to the gentleman from Massachusetts (Mr. Frank) my 
efforts to try to solve that problem. I think it is going to be 
impossible at this point in the process, but going forward, 
particularly in conference, I have every reason to think that we can 
come to a good conclusion. We all, I think, recognize that the 
protected class should continue to have access to free credit reports, 
as they always have had, as the gentlewoman from Oregon (Ms. Hooley) so 
carefully pointed out.
  The real issue is the exemptions of the small agencies that represent 
approximately 10 percent of those credit reports. I do not think at the 
end of the day the position of the gentleman from Massachusetts (Mr. 
Frank) and the gentleman from Louisiana (Mr. Baker) are all that 
different, and I would simply say that I would pledge my efforts 
towards reaching a good conclusion towards both gentlemen's aims.
  Mr. FRANK of Massachusetts. Mr. Chairman, I yield myself such time as 
I may consume.
  Mr. Chairman, I guess I must look pretty stupid to be told that 
people are going to work with me at the end of the bill.
  This process has been going on since we finished the markup. My staff 
was negotiating with the staff of the majority. We offered all kinds of 
things. We had the manager's amendment opportunity. This amendment was 
filed last night. It was subject to secondary degree amendment. It 
could have been changed.
  The gentleman from Ohio (Mr. Oxley) said there is no real difference 
between my position and the position of the gentleman from Louisiana. 
Let me correct the gentleman, there is no difference between my 
position and the position the gentleman from Louisiana explained when 
the amendment was offered; but there is a big difference between my 
position and what the law says if we pass this bill this way.
  We talk about the protected classes, people who have been the victims 
of fraud, people who are unemployed, if you pass this bill and defeat 
this amendment, they will have less rights thanks to your work than 
they have today. The amendment of the gentleman from Louisiana (Mr. 
Baker), he said through inadvertence, took away their rights. Whatever 
they use to take away their rights, whether it was inadvertence, 
advertence, or anything else, they have lost their rights.
  Now after saying no to a negotiation before, no to the manager's 
amendment, and no to an amendment here, now the other side says we will 
see you in conference. Let me make a commitment to the gentleman. If 
you want to use your majority to defeat this amendment, I probably 
cannot stop you; but if this is not substantially repaired in 
conference, this bipartisan consensus is coming to an end.
  Mr. BAKER. Mr. Chairman, I yield myself such time as I may consume.
  Let me return to the basis of the current law and what the effect of 
the amendment would be if adopted. Today, any person who is the subject 
of an adverse action, you get turned down, you have an absolute right 
to a free credit report regardless of your economic status.
  If you are a consumer who suspects fraudulent conduct regardless of 
your economic status, you get a free credit report. If you are 
unemployed, you get a free credit report. If you are subject to public 
welfare, you get a free credit report. The amendment adopted I proposed 
in committee does not, in any way, limit or affect those rights that 
exist under current law. The bill as proposed without the amendment I 
offered would have established one more level for a free credit report.
  I was and am willing, as is the current law with regard to these 
categories, to say that with regard to the one additional credit 
report, that the protected classes may have access to that information 
without charge. But it is not a correct view of the effect of the Baker 
amendment as adopted to suggest that it rolls back current protections 
and authorities of those desiring to get a free credit report. It would 
with regard to the new right being adopted by passage of the Act. That 
is the state of affairs if we defeat the Frank amendment, which I hope 
the House will engage in; and again, renew the pledge to the gentleman, 
despite his difficulties with the manner under which this has 
proceeded, if we are fortunate enough to be on such a conference, to 
work with the gentleman toward appropriate resolution, and would hope 
the House would reject the Frank amendment.
  Mr. Chairman, I yield back the balance of my time.
  The CHAIRMAN pro tempore (Mr. Culberson). The question is on the 
amendment offered by the gentleman from Massachusetts (Mr. Frank).
  The question was taken; and the Chairman pro tempore announced that 
the noes appeared to have it.
  Mr. FRANK of Massachusetts. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN pro tempore. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from 
Massachusetts (Mr. Frank) will be postponed.


                Amendment No. 9 Offered by Mrs. Tauscher

  Mrs. TAUSCHER. Mr. Chairman, I offer an amendment.
  The CHAIRMAN pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 9 offered by Mrs. Tauscher:
       Page 69, after line 5, insert the following new section 
     (and conform the table of contents accordingly):

     SEC. 510. REQUESTS BY CONSUMERS FOR REASONABLE PROCEDURES FOR 
                   ESTABLISHING NEW CREDIT.

       Section 615 of the Fair Credit Reporting Act (15 U.S.C. 
     1681m) is amended by inserting after subsection (e) (as added 
     by section 403 of this Act) the following new subsection:

[[Page 21785]]

       ``(f) Requests by Consumers for Reasonable Procedures for 
     Establishing New Credit.--
       ``(1) In general.--Any consumer may submit a request to a 
     consumer reporting agency that any person who uses a consumer 
     report of such consumer to establish a new credit plan in the 
     name of the consumer utilize reasonable policies and 
     procedures described in paragraph (4).
       ``(2) Placement in file.--Any consumer reporting agency 
     that receives a request from a consumer shall include the 
     request in the file of the consumer.
       ``(3) Notice to users.--No person who obtains any 
     information from a file of any consumer from a consumer 
     reporting agency that includes a request from the consumer 
     under this subsection may establish a new credit plan in the 
     name of the consumer for a person other than the consumer 
     without utilizing reasonable policies and procedures 
     described in paragraph (4).
       ``(4) Reasonable policies and procedures.--The notice 
     included by the consumer reporting agency pursuant to the 
     request of the consumer shall state that the consumer does 
     not authorize establishing any new credit plan in the name of 
     the consumer, unless the user utilizes reasonable policies 
     and procedures to form a reasonable belief that the user 
     knows the identity of the person for whom such new plan is 
     established, which may include obtaining authorization or 
     preauthorization of the consumer at a telephone number 
     designated by the consumer or by such other reasonable means 
     agreed to.''.

  The CHAIRMAN pro tempore. Pursuant to the order of Committee of 
today, the gentlewoman from California (Mrs. Tauscher) and a Member 
opposed to the amendment each will control 5 minutes.
  The Chair recognizes the gentlewoman from California (Mrs. Tauscher).
  Mrs. TAUSCHER. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I rise today to ask my colleagues to support a simple 
amendment. Currently only consumers who can prove that they already 
have been victims of identity theft can ask the credit industry to 
confirm the identity of a person before issuing new credit accounts 
under the consumer's name. My amendment would simply allow any consumer 
the option to require the credit industry to use the reasonable 
policies and procedures identification standards established in the 
fraud alert provision. This amendment would give all consumers, 
students, military, the elderly and families, a meaningful way to 
protect their own personal credit records.
  Proponents of this bill claim that the fraud alert provision creates 
powerful consumer protection tools to prevent identity thieves from 
opening accounts in their names. They fail to mention that the tools 
are available only after one becomes a victim. Talk about closing the 
barn door after the horse is out.

                              {time}  1915

  The credit industry argues that the public needs education to learn 
how to protect their data. While there are some precautions individuals 
can take, individual consumers have little or no means to protect 
themselves from the fastest-growing type of identification theft, theft 
from poorly protected databases. Since 1990, 33 million Americans, or 
one in six adults, have been victims of identity theft. This year 
businesses will lose $4.2 billion to this crime, losses that will 
ultimately be passed on to other customers. Earlier this year, the 
major credit card companies confirmed that a hacker broke into their 
systems and accessed 8 million credit card records. My amendment would 
provide all consumers an option to proactively protect their personal 
information against fraudulent use by identity thieves, organized crime 
and terrorist organizations.
  Mr. Chairman, I would like to ask the distinguished ranking member 
from Massachusetts to work with me and the members of the committee 
during conference to implement the spirit of my amendment in the final 
report.
  Mr. FRANK of Massachusetts. Mr. Chairman, will the gentlewoman yield?
  Mrs. TAUSCHER. I yield to the gentleman from Massachusetts.
  Mr. FRANK of Massachusetts. Mr. Chairman, I thank the gentlewoman for 
her spirit of cooperation. I think she is very much right on the 
substance. We did have to try to work out a balance out of committee. 
Some of us, as you recently saw, were more willing to stick to our 
commitments than others; but I would say to the gentlewoman, I think 
that in substance she has a very good idea and, yes, I would welcome 
the chance to try to work with her in conference assuming that there is 
something conferencable about this, as there may well be.
  Mrs. TAUSCHER. I thank the gentleman.
  Mr. Chairman, I ask unanimous consent to withdraw my amendment.
  The CHAIRMAN pro tempore (Mr. Culberson). Is there objection to the 
request of the gentlewoman from California?
  There was no objection.


          Sequential Votes Postponed in Committee of the Whole

  The CHAIRMAN pro tempore. Pursuant to clause 6 of rule XVIII, 
proceedings will now resume on those amendments on which further 
proceedings were postponed in the following order: amendment No. 4 
offered by the gentleman from Vermont (Mr. Sanders), amendment No. 1 
offered by the gentleman from Pennsylvania (Mr. Kanjorski), amendment 
No. 6 offered by the gentleman from Massachusetts (Mr. Frank), and 
amendment No. 12 offered by the gentleman from Ohio (Mr. Ney).
  The first electronic vote will be conducted as a 15-minute vote. The 
remaining electronic votes in this series will be conducted as 5-minute 
votes.


                 Amendment No. 4 Offered by Mr. Sanders

  The CHAIRMAN pro tempore. The pending business is the demand for a 
recorded vote on the amendment offered by the gentleman from Vermont 
(Mr. Sanders) on which further proceedings were postponed and on which 
the noes prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN pro tempore. A recorded vote has been demanded.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 142, 
noes 272, answered ``present'' 1, not voting 19, as follows:

                             [Roll No. 495]

                               AYES--142

     Abercrombie
     Ackerman
     Aderholt
     Bachus
     Baldwin
     Ballance
     Barton (TX)
     Becerra
     Bereuter
     Berman
     Bishop (NY)
     Blumenauer
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Carson (IN)
     Clay
     Conyers
     Cooper
     Costello
     Cubin
     Cummings
     Davis (AL)
     Davis (CA)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Doyle
     Duncan
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Frost
     Gonzalez
     Green (TX)
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hinchey
     Hoeffel
     Honda
     Hyde
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     Johnson, E. B.
     Jones (NC)
     Jones (OH)
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kleczka
     Kucinich
     LaHood
     Lampson
     Langevin
     Lantos
     Larson (CT)
     LaTourette
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Lynch
     Maloney
     Matsui
     McCarthy (MO)
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Menendez
     Millender-McDonald
     Miller, George
     Mollohan
     Moran (KS)
     Moran (VA)
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Otter
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pomeroy
     Rahall
     Reyes
     Rodriguez
     Rogers (AL)
     Rothman
     Roybal-Allard
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanders
     Schakowsky
     Schiff
     Scott (GA)
     Scott (VA)
     Serrano
     Shays
     Sherman
     Slaughter
     Solis
     Stark
     Strickland
     Taylor (MS)
     Tierney
     Udall (NM)
     Van Hollen
     Visclosky
     Wamp
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Weldon (PA)
     Wexler
     Whitfield
     Wu

                               NOES--272

     Akin
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Bass
     Beauprez
     Bell
     Berkley
     Berry
     Biggert
     Bilirakis
     Bishop (GA)
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boswell
     Boucher
     Boyd
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Cardin

[[Page 21786]]


     Cardoza
     Carson (OK)
     Carter
     Case
     Castle
     Chabot
     Chocola
     Clyburn
     Coble
     Cole
     Collins
     Cox
     Cramer
     Crane
     Crenshaw
     Crowley
     Culberson
     Cunningham
     Davis (FL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeGette
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dooley (CA)
     Doolittle
     Dreier
     Dunn
     Ehlers
     Emanuel
     Engel
     English
     Everett
     Feeney
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Frank (MA)
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Gordon
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hefley
     Hensarling
     Herger
     Hill
     Hinojosa
     Hobson
     Holden
     Hooley (OR)
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Inslee
     Isakson
     Israel
     Issa
     Istook
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Kanjorski
     Keller
     Kelly
     Kennedy (MN)
     Kind
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Larsen (WA)
     Latham
     Leach
     Lewis (CA)
     Lewis (KY)
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Majette
     Manzullo
     Marshall
     Matheson
     McCarthy (NY)
     McCollum
     McCotter
     McCrery
     McHugh
     McInnis
     McIntyre
     Meeks (NY)
     Mica
     Michaud
     Miller (FL)
     Miller (MI)
     Miller (NC)
     Miller, Gary
     Moore
     Murphy
     Murtha
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Oxley
     Paul
     Pearce
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ross
     Royce
     Ryan (WI)
     Ryun (KS)
     Sanchez, Loretta
     Sandlin
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Snyder
     Souder
     Spratt
     Stearns
     Stenholm
     Stupak
     Sullivan
     Sweeney
     Tancredo
     Tanner
     Tauscher
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thompson (CA)
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Towns
     Turner (OH)
     Turner (TX)
     Upton
     Velazquez
     Vitter
     Walden (OR)
     Walsh
     Weldon (FL)
     Weller
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wynn
     Young (AK)
     Young (FL)

                        ANSWERED ``PRESENT''--1

       
     Ruppersberger
       

                             NOT VOTING--19

     Burton (IN)
     Davis (IL)
     Emerson
     Gephardt
     Hayworth
     Hoekstra
     Holt
     Janklow
     Linder
     Lipinski
     Markey
     McDermott
     McKeon
     Pelosi
     Pence
     Rangel
     Thompson (MS)
     Udall (CO)
     Woolsey


                Announcement by the Chairman Pro Tempore

  The CHAIRMAN pro tempore (Mr. Culberson) (during the vote). Members 
are advised they have 2 minutes within which to record their vote.

                              {time}  1937

  Messrs. CARDOZA, BARTLETT of Maryland, SANDLIN, CLYBURN, MICHAUD, 
ENGEL and INSLEE changed their vote from ``aye'' to ``no.''
  Mr. ADERHOLT and Mr. BECERRA changed their vote from ``no'' to 
``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.
  Stated for:
  Mr. HOLT. Mr. Chairman, I was unavoidably detained and failed to vote 
on rollcall No. 495 (the Sanders amendment to the Fair and Accurate 
Credit Transactions Act). Had I been present I would have voted 
``aye.''


                Amendment No. 1 Offered by Mr. Kanjorski

  The CHAIRMAN pro tempore. The pending business is the demand for a 
recorded vote on the amendment offered by the gentleman from 
Pennsylvania (Mr. Kanjorski) on which further proceedings were 
postponed and on which the noes prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN pro tempore. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 112, 
noes 310, answered ``present'' 1, not voting 11, as follows:

                             [Roll No. 496]

                               AYES--112

     Abercrombie
     Ackerman
     Baca
     Baldwin
     Barton (TX)
     Becerra
     Berkley
     Berman
     Bishop (NY)
     Blumenauer
     Brady (PA)
     Capps
     Capuano
     Cardin
     Conyers
     Cummings
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Doggett
     Doyle
     Emanuel
     Eshoo
     Etheridge
     Farr
     Fattah
     Filner
     Flake
     Frank (MA)
     Grijalva
     Harman
     Hastings (FL)
     Hefley
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson (CT)
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larson (CT)
     Lee
     Lewis (GA)
     Lofgren
     Lowey
     Lynch
     Majette
     Maloney
     Markey
     McCarthy (MO)
     McDermott
     McGovern
     McNulty
     Meehan
     Millender-McDonald
     Miller, George
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Obey
     Olver
     Owens
     Pallone
     Pascrell
     Pastor
     Paul
     Payne
     Price (NC)
     Radanovich
     Rahall
     Rodriguez
     Rothman
     Roybal-Allard
     Rush
     Ryan (OH)
     Sanchez, Linda T.
     Sanders
     Schakowsky
     Scott (VA)
     Sherman
     Slaughter
     Solis
     Stark
     Stupak
     Taylor (MS)
     Thompson (CA)
     Tierney
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner

                               NOES--310

     Aderholt
     Akin
     Alexander
     Allen
     Andrews
     Bachus
     Baird
     Baker
     Ballance
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Bass
     Beauprez
     Bell
     Bereuter
     Berry
     Biggert
     Bilirakis
     Bishop (GA)
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boswell
     Boucher
     Boyd
     Bradley (NH)
     Brady (TX)
     Brown (OH)
     Brown (SC)
     Brown, Corrine
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Cardoza
     Carson (IN)
     Carson (OK)
     Carter
     Case
     Castle
     Chabot
     Chocola
     Clay
     Clyburn
     Coble
     Cole
     Collins
     Cooper
     Costello
     Cox
     Cramer
     Crane
     Crenshaw
     Crowley
     Cubin
     Culberson
     Cunningham
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     DeMint
     Deutsch
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dicks
     Dingell
     Dooley (CA)
     Doolittle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Engel
     English
     Evans
     Everett
     Feeney
     Ferguson
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Franks (AZ)
     Frelinghuysen
     Frost
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gonzalez
     Goode
     Goodlatte
     Gordon
     Goss
     Granger
     Graves
     Green (TX)
     Green (WI)
     Greenwood
     Gutierrez
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hensarling
     Herger
     Hill
     Hinchey
     Hobson
     Hooley (OR)
     Hostettler
     Houghton
     Hoyer
     Hulshof
     Hunter
     Hyde
     Isakson
     Israel
     Issa
     Istook
     Jenkins
     John
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kilpatrick
     Kind
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Larsen (WA)
     Latham
     LaTourette
     Leach
     Levin
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Manzullo
     Marshall
     Matheson
     Matsui
     McCarthy (NY)
     McCollum
     McCotter
     McCrery
     McHugh
     McInnis
     McIntyre
     McKeon
     Meek (FL)
     Meeks (NY)
     Menendez
     Mica
     Michaud
     Miller (FL)
     Miller (MI)
     Miller (NC)
     Miller, Gary
     Mollohan
     Moore
     Moran (KS)
     Moran (VA)
     Murphy
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Oberstar
     Ortiz
     Osborne
     Ose
     Otter
     Oxley
     Pearce
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Pomeroy
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Ramstad
     Regula
     Rehberg
     Renzi
     Reyes
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ross
     Royce
     Ryan (WI)
     Ryun (KS)
     Sabo
     Sanchez, Loretta
     Sandlin
     Saxton
     Schiff
     Schrock
     Scott (GA)
     Sensenbrenner
     Serrano
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Snyder
     Souder
     Spratt
     Stearns
     Stenholm
     Strickland
     Sullivan
     Sweeney
     Tancredo
     Tanner
     Tauscher
     Tauzin

[[Page 21787]]


     Taylor (NC)
     Terry
     Thomas
     Thompson (MS)
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Towns
     Turner (OH)
     Turner (TX)
     Upton
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wu
     Wynn
     Young (AK)
     Young (FL)

                        ANSWERED ``PRESENT''--1

       
     Ruppersberger
       

                             NOT VOTING--11

     Davis (IL)
     Emerson
     Gephardt
     Hoekstra
     Janklow
     Lipinski
     Pelosi
     Pence
     Rangel
     Udall (CO)
     Woolsey


                Announcement by the Chairman Pro Tempore

  The CHAIRMAN pro tempore (during the vote). Members are advised 2 
minutes remain in this vote.

                              {time}  1944

  So the amendment was rejected.
  The result of the vote was announced as above recorded.


         Amendment No. 6 Offered by Mr. Frank of Massachusetts

  The CHAIRMAN pro tempore (Mr. Culberson). The pending business is the 
demand for a recorded vote on the amendment offered by the gentleman 
from Massachusetts (Mr. Frank) on which further proceedings were 
postponed and on which the noes prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN pro tempore. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 235, 
noes 186, answered ``present'' 1, not voting 12, as follows:

                             [Roll No. 497]

                               AYES--235

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Barton (TX)
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Biggert
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boehlert
     Bono
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Burton (IN)
     Buyer
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Case
     Clay
     Clyburn
     Coble
     Conyers
     Cooper
     Costello
     Cramer
     Crowley
     Culberson
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (TN)
     Davis, Tom
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Dreier
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Frost
     Gerlach
     Gilchrest
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Gutknecht
     Hall
     Harman
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Isakson
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson (CT)
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kirk
     Kleczka
     Kucinich
     LaHood
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     LaTourette
     Leach
     Lee
     Levin
     Lewis (GA)
     LoBiondo
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Majette
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McHugh
     McIntyre
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Peterson (MN)
     Petri
     Platts
     Pomeroy
     Price (NC)
     Putnam
     Quinn
     Rahall
     Reyes
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Royce
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (GA)
     Scott (VA)
     Sensenbrenner
     Serrano
     Shaw
     Sherman
     Shimkus
     Simmons
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stearns
     Stenholm
     Strickland
     Stupak
     Sweeney
     Tanner
     Tauscher
     Taylor (MS)
     Taylor (NC)
     Terry
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (NM)
     Upton
     Van Hollen
     Velazquez
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Weldon (PA)
     Wexler
     Wicker
     Wu
     Wynn

                               NOES--186

     Aderholt
     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Bass
     Beauprez
     Bereuter
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehner
     Bonilla
     Bonner
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Cole
     Collins
     Crane
     Crenshaw
     Cubin
     Cunningham
     Davis, Jo Ann
     Deal (GA)
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Duncan
     Dunn
     Ehlers
     English
     Everett
     Feeney
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gibbons
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Issa
     Istook
     Jenkins
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kline
     Knollenberg
     Kolbe
     Latham
     Lewis (CA)
     Lewis (KY)
     Linder
     Lucas (OK)
     Manzullo
     McCotter
     McCrery
     McInnis
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Peterson (PA)
     Pickering
     Pitts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sessions
     Shadegg
     Shays
     Sherwood
     Shuster
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Sullivan
     Tancredo
     Tauzin
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weller
     Whitfield
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                        ANSWERED ``PRESENT''--1

       
     Ruppersberger
       

                             NOT VOTING--12

     Cox
     Davis (IL)
     Emerson
     Gephardt
     Hoekstra
     Janklow
     Lipinski
     Pelosi
     Pence
     Rangel
     Udall (CO)
     Woolsey


                Announcement by the Chairman Pro Tempore

  The CHAIRMAN pro tempore (during the vote). Members are advised there 
are 2 minutes remaining on this vote.

                              {time}  1953

  Messrs. DREIER, PETRI, TERRY, BURTON of Indiana, KIRK, SHIMKUS, 
LoBIONDO, and Mrs. BONO changed their vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.


                  Amendment No. 12 Offered by Mr. Ney

  The CHAIRMAN pro tempore. The pending business is the demand for a 
recorded vote on the amendment offered by the gentleman from Ohio (Mr. 
Ney) on which further proceedings were postponed and on which the noes 
prevailed by voice vote.
  The Clerk will redesignate the amendment.
  The Clerk redesignated the amendment.


                             Recorded Vote

  The CHAIRMAN pro tempore. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 233, 
noes 189, answered ``present'' 1, not voting 11, as follows:

                             [Roll No. 498]

                               AYES--233

     Abercrombie
     Aderholt
     Akin
     Allen
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boswell
     Boucher
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Cannon
     Cantor
     Capito
     Carter
     Case
     Castle
     Chabot
     Chocola
     Coble

[[Page 21788]]


     Cole
     Collins
     Cooper
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis (AL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dicks
     Doolittle
     Dreier
     Dunn
     Edwards
     Ehlers
     English
     Etheridge
     Everett
     Feeney
     Ferguson
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gordon
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Harman
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hensarling
     Herger
     Hobson
     Holden
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Manzullo
     Marshall
     McCotter
     McCrery
     McHugh
     McInnis
     McKeon
     Mica
     Michaud
     Miller (MI)
     Miller, Gary
     Mollohan
     Moran (KS)
     Moran (VA)
     Murphy
     Nethercutt
     Neugebauer
     Ney
     Northup
     Nunes
     Nussle
     Osborne
     Ose
     Oxley
     Pearce
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Pomeroy
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Rahall
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Sandlin
     Saxton
     Schrock
     Scott (GA)
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Stenholm
     Strickland
     Sullivan
     Sweeney
     Tanner
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Upton
     Vitter
     Walden (OR)
     Walsh
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                               NOES--189

     Ackerman
     Alexander
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Barton (TX)
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Camp
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Clay
     Clyburn
     Conyers
     Costello
     Crowley
     Cummings
     Davis (CA)
     Davis (FL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Duncan
     Emanuel
     Engel
     Eshoo
     Evans
     Farr
     Fattah
     Filner
     Flake
     Frank (MA)
     Franks (AZ)
     Frelinghuysen
     Frost
     Gonzalez
     Goode
     Goodlatte
     Green (TX)
     Grijalva
     Gutierrez
     Hall
     Hastings (FL)
     Hefley
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kingston
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     LaTourette
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Lynch
     Majette
     Maloney
     Markey
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McIntyre
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller (FL)
     Miller (NC)
     Miller, George
     Moore
     Murtha
     Musgrave
     Myrick
     Nadler
     Napolitano
     Neal (MA)
     Norwood
     Oberstar
     Obey
     Olver
     Ortiz
     Otter
     Owens
     Pallone
     Pascrell
     Pastor
     Paul
     Payne
     Peterson (MN)
     Price (NC)
     Reyes
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Schakowsky
     Schiff
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stupak
     Tancredo
     Tauscher
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Wamp
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Weldon (FL)
     Wexler
     Wu
     Wynn

                        ANSWERED ``PRESENT''--1

       
     Ruppersberger
       

                             NOT VOTING--11

     Davis (IL)
     Emerson
     Gephardt
     Hoekstra
     Janklow
     Lipinski
     Pelosi
     Pence
     Rangel
     Udall (CO)
     Woolsey


                Announcement by the Chairman Pro Tempore

  The CHAIRMAN pro tempore (Mr. Culberson) (during the vote). Members 
are advised there are 2 minutes in which to record their votes.

                              {time}  2001

  Mr. ROHRABACHER changed his vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.
  The CHAIRMAN pro tempore. Are there any other amendments?
  If not, the question is on the committee amendment in the nature of a 
substitute, as amended.
  The committee amendment in the nature of a substitute, as amended, 
was agreed to.
  The CHAIRMAN pro tempore. Under the rule, the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Hastings of Washington) having assumed the chair, Mr. Culberson, 
Chairman pro tempore of the Committee of the Whole House on the State 
of the Union, reported that that Committee, having had under 
consideration the bill (H.R. 2622) 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, pursuant to House Resolution 360, he reported the bill 
back to the House with an amendment adopted by the Committee of the 
Whole.
  Mr. SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  Is a separate vote demanded on any amendment to the Committee 
amendment in the nature of a substitute adopted by the Committee of the 
Whole? If not, the question is on the amendment.
  The amendment was agreed to.
  The SPEAKER pro tempore. The question is on engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  Mr. SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. OXLEY. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The vote was taken by electronic device, and there were--yeas 392, 
nays 30, answered ``present'' 1, not voting 11, as follows:

                             [Roll No. 499]

                               YEAS--392

     Abercrombie
     Ackerman
     Akin
     Alexander
     Allen
     Andrews
     Baca
     Bachus
     Baird
     Baker
     Baldwin
     Ballance
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Becerra
     Bell
     Bereuter
     Berkley
     Berry
     Biggert
     Bilirakis
     Bishop (GA)
     Bishop (NY)
     Bishop (UT)
     Blackburn
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boswell
     Boucher
     Boyd
     Bradley (NH)
     Brady (PA)
     Brady (TX)
     Brown (OH)
     Brown (SC)
     Brown, Corrine
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Carter
     Case
     Castle
     Chabot
     Chocola
     Clay
     Clyburn
     Coble
     Cole
     Collins
     Cooper
     Costello
     Cox
     Cramer
     Crane
     Crenshaw
     Crowley
     Cubin
     Culberson
     Cummings
     Cunningham
     Davis (AL)
     Davis (FL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeGette
     DeLauro
     DeLay
     DeMint
     Deutsch
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doolittle
     Doyle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Emanuel
     Engel
     English
     Etheridge
     Evans
     Everett
     Fattah
     Feeney
     Ferguson
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Frank (MA)
     Franks (AZ)
     Frelinghuysen
     Frost
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gonzalez
     Goode
     Goodlatte
     Gordon
     Goss
     Granger
     Graves
     Green (TX)
     Green (WI)
     Greenwood
     Grijalva
     Gutierrez
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (FL)
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hill
     Hinchey
     Hinojosa
     Hobson
     Hoeffel
     Holden
     Holt
     Hooley (OR)
     Hostettler
     Houghton
     Hoyer

[[Page 21789]]


     Hulshof
     Hunter
     Hyde
     Inslee
     Isakson
     Israel
     Issa
     Istook
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, E. B.
     Johnson, Sam
     Jones (NC)
     Jones (OH)
     Kanjorski
     Kaptur
     Keller
     Kelly
     Kennedy (MN)
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kleczka
     Kline
     Knollenberg
     Kolbe
     LaHood
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Latham
     LaTourette
     Leach
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     LoBiondo
     Lowey
     Lucas (KY)
     Lucas (OK)
     Lynch
     Majette
     Maloney
     Manzullo
     Marshall
     Matheson
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCotter
     McCrery
     McDermott
     McGovern
     McHugh
     McInnis
     McIntyre
     McKeon
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Mica
     Michaud
     Miller (FL)
     Miller (MI)
     Miller (NC)
     Miller, Gary
     Mollohan
     Moore
     Moran (KS)
     Moran (VA)
     Murphy
     Murtha
     Musgrave
     Myrick
     Napolitano
     Neal (MA)
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Oberstar
     Obey
     Olver
     Ortiz
     Osborne
     Ose
     Otter
     Owens
     Oxley
     Pallone
     Pascrell
     Pastor
     Payne
     Pearce
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Pomeroy
     Porter
     Portman
     Price (NC)
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Rahall
     Ramstad
     Regula
     Rehberg
     Renzi
     Reyes
     Reynolds
     Rodriguez
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ross
     Rothman
     Roybal-Allard
     Royce
     Rush
     Ryan (OH)
     Ryan (WI)
     Ryun (KS)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sandlin
     Saxton
     Schrock
     Scott (GA)
     Scott (VA)
     Sensenbrenner
     Serrano
     Sessions
     Shadegg
     Shaw
     Shays
     Sherman
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Skelton
     Slaughter
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Snyder
     Solis
     Souder
     Spratt
     Stearns
     Stenholm
     Strickland
     Stupak
     Sullivan
     Sweeney
     Tancredo
     Tanner
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thompson (MS)
     Thornberry
     Tiahrt
     Tiberi
     Tierney
     Toomey
     Towns
     Turner (OH)
     Turner (TX)
     Udall (NM)
     Upton
     Van Hollen
     Velazquez
     Visclosky
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Watt
     Weiner
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wu
     Wynn
     Young (AK)
     Young (FL)

                                NAYS--30

     Berman
     Conyers
     Davis (CA)
     DeFazio
     Delahunt
     Eshoo
     Farr
     Filner
     Flake
     Harman
     Honda
     Jackson (IL)
     Kucinich
     Lee
     Lofgren
     Markey
     Matsui
     Millender-McDonald
     Miller, George
     Nadler
     Paul
     Sanders
     Schakowsky
     Schiff
     Stark
     Tauscher
     Thompson (CA)
     Waters
     Watson
     Waxman

                        ANSWERED ``PRESENT''--1

       
     Ruppersberger
       

                             NOT VOTING--11

     Aderholt
     Davis (IL)
     Emerson
     Gephardt
     Hoekstra
     Janklow
     Lipinski
     Pence
     Rangel
     Udall (CO)
     Woolsey


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. Hastings of Washington) (during the 
vote). Members are advised there are 2 minutes remaining in this vote.

                              {time}  2019

  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________