[House Report 116-305]
[From the U.S. Government Publishing Office]


116th Congress   }                                       {      Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                       {     116-305

======================================================================



 
         RESTRICTING CREDIT CHECKS FOR EMPLOYMENT DECISIONS ACT

                                _______
                                

 November 21, 2019.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Ms. Waters, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 3614]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 3614) to amend the Fair Credit Reporting Act to 
ban the use of credit information for most employment 
decisions, and for other purposes, having considered the same, 
report favorably thereon with an amendment and recommend that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     4
Background and Need for Legislation..............................     4
Section-by-Section Analysis......................................     6
Hearings.........................................................     6
Committee Consideration..........................................     7
Committee Votes..................................................     7
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     9
Statement of Performance Goals and Objectives....................     9
New Budget Authority and CBO Cost Estimate.......................     9
Committee Cost Estimate..........................................    10
Unfunded Mandate Statement.......................................    11
Advisory Committee...............................................    11
Application of Law to the Legislative Branch.....................    11
Earmark Statement................................................    11
Duplication of Federal Programs..................................    11
Changes to Existing Law..........................................    11

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Restricting Credit Checks for 
Employment Decisions Act''.

SEC. 2. FINDINGS.

  Congress finds the following:
          (1) The use of credit reports as a factor in making hiring 
        decisions has been found to be prevalent in a diverse array of 
        occupations, and is not limited to certain high-level 
        management or executive positions.
          (2) According to the California Labor Federation, only 25 
        percent of employers researched the credit history of job 
        applicants in 1998. However, this practice had increased to 43 
        percent by 2006 and to 60 percent by 2011.
          (3) A study titled ``Do Job Applicant Credit Histories 
        Predict Job Performance Appraisal Ratings or Termination 
        Decisions?'', published in 2012, found that, while credit 
        history might conceptually measure a person's level of 
        responsibility, ability to meet deadlines, dependability, or 
        integrity, it does not, in practice, actually predict an 
        employee's performance or likelihood to quit. Credit reports 
        contain many inaccuracies and credit history can be 
        contaminated by events that are sometimes outside a person's 
        control, such as a sudden medical expense after an accident or 
        the loss of a job during an economic downturn. The study found 
        that there is no benefit from using credit history to predict 
        job performance or turnover.
          (4) Despite the absence of data showing a correlation between 
        job performance and credit-worthiness, employers continue to 
        use credit checks as a proxy for assessing character and 
        integrity. According to a 2012 Society for Human Resource 
        Management survey, organizations indicated that they used 
        credit checks on job candidates primarily to reduce or prevent 
        theft and embezzlement and to minimize legal liability for 
        negligent hiring.
          (5) The use of credit checks for employment purposes creates 
        a true ``catch-22'' for unemployed people with impaired credit. 
        For example, the financial hardship caused by losing a job may 
        cause some unemployed individuals to make late or partial 
        payments on their bills, but their poor credit standing caused 
        by this negative information on their consumer report can also 
        impede their chances of obtaining a new job to end their 
        financial distress.
          (6) A September 2014 report by the New York City Council's 
        Committee on Civil Rights noted that, for those who have been 
        unemployed for an extended period of time and whose credit has 
        suffered as they fell behind on bills, the use of credit 
        reports in the hiring process can exacerbate and perpetuate an 
        already precarious situation.
          (7) In a March 2013 Demos report titled ``Discredited: How 
        Employment Credit Checks Keep Out Qualified Workers Out of a 
        Job'', one in four survey participants who were unemployed said 
        that a potential employer had requested to check their credit 
        report as part of a job application. Among job applicants with 
        blemished credit histories in the survey, one in seven had been 
        told that they were not being hired because of their credit 
        history.
          (8) While job applicants must give prior approval for a 
        prospective employer to pull their credit reports under the 
        FCRA, this authorization, as a practical matter, does not 
        constitute an effective consumer protection because an employer 
        may reject any job applicant who refuses a credit check.
          (9) Some negative information on a report may stem from 
        uncontrollable circumstances, or significant life events in a 
        consumer's life, such as a medical crisis or a divorce. Demos 
        found that poor credit is associated with household 
        unemployment, lack of health coverage, and medical debt, which 
        are factors that reflect economic conditions in the country and 
        personal misfortune that have little relationship with how well 
        a job applicant would perform at work.
          (10) In October 2011, FICO noted that from 2008 to 2009 
        approximately 50 million people experienced a 20-point drop in 
        their credit scores and about 21 million saw their scores 
        decline by more than 50 points. While the Great Recession 
        reduced many consumers' credit scores due to foreclosures and 
        other financial hardships, the financial crisis had a 
        particularly harsh impact on African Americans and Latinos, as 
        racial and ethnic minorities and communities of color were 
        frequently targeted by predatory mortgage lenders who steered 
        borrowers into high-cost subprime loans, even when these 
        borrowers would have qualified for less costly prime credit.
          (11) A May 2006 Brookings Institution report titled ``Credit 
        Scores, Reports, and Getting Ahead in America'' found that 
        counties with a relatively higher proportion of racial and 
        ethnic minorities in the United States tended to have lower 
        credit scores compared with counties that had a lower 
        concentration of communities of color.
          (12) Studies have consistently found that African American 
        and Latino households tend, on average, to have lower credit 
        scores than White households. The growing use of credit checks, 
        therefore, may disproportionately screen otherwise qualified 
        racial and ethnic minorities out of jobs, leading to 
        discriminatory hiring practices, and further exacerbating the 
        trend where unemployment for African American and Latino 
        communities is elevated well above the rate of Whites.
          (13) A 2012 Demos survey found that 65 percent of White 
        respondents reported having good or excellent credit scores 
        while over half of African American households reported only 
        having fair or bad credit.

SEC. 3. PROHIBITION ON THE USE OF CREDIT INFORMATION FOR MOST 
                    EMPLOYMENT DECISIONS.

  (a) In General.--Section 604 of the Fair Credit Reporting Act (15 
U.S.C. 1681b) is amended--
          (1) in subsection (a)(3)(B), by inserting ``, subject to the 
        requirements of subsection (b)'' after ``purposes''; and
          (2) in subsection (b)--
                  (A) in paragraph (1)--
                          (i) by amending the paragraph heading to read 
                        as follows: ``Use of consumer reports for 
                        employment purposes'';
                          (ii) in subparagraph (A), by redesignating 
                        clauses (i) and (ii) as subclauses (I) and 
                        (II), respectively (and conforming the margins 
                        accordingly);
                          (iii) by redesignating subparagraphs (A) and 
                        (B) as clauses (i) and (ii), respectively (and 
                        conforming the margins accordingly);
                          (iv) by striking the period at the end of 
                        clause (ii) (as so redesignated) and inserting 
                        ``; and'';
                          (v) by striking ``agency may furnish'' and 
                        inserting ``agency--
                  ``(A) may furnish''; and
                          (vi) by adding at the end the following new 
                        subparagraph:
                  ``(B) except as provided in paragraph (5), may not 
                furnish a consumer report with respect to any consumer 
                in which any information contained in the report bears 
                on the consumer's creditworthiness, credit standing, or 
                credit capacity.''; and
                  (B) by adding at the end the following new 
                paragraphs:
          ``(5) Requirements for consumer reports bearing on the 
        consumer's creditworthiness, credit standing, or credit 
        capacity.--
                  ``(A) In general.--A person may use a consumer report 
                with respect to any consumer in which any information 
                contained in the report bears on the consumer's 
                creditworthiness, credit standing, or credit capacity 
                only if--
                          ``(i) either--
                                  ``(I) the person is required to 
                                obtain the report by a Federal, State, 
                                or local law or regulation; or
                                  ``(II) the information contained in 
                                the report is being used with respect 
                                to a national security investigation 
                                (as defined in paragraph (4)(D));
                          ``(ii) none of the cost associated with 
                        obtaining the consumer report will be passed on 
                        to the consumer to whom the report relates; and
                          ``(iii) the information contained in the 
                        consumer report will not be disclosed to any 
                        other person other than--
                                  ``(I) in an aggregate format that 
                                protects a consumer's personally 
                                identifiable information; or
                                  ``(II) as may be necessary to comply 
                                with any applicable Federal, State, or 
                                local equal employment opportunity law 
                                or regulation.
                  ``(B) Disclosures.--A person who procures, or causes 
                to be procured, a consumer report described in 
                subparagraph (A) for employment purposes shall, in the 
                disclosure made pursuant to paragraph (2), include--
                          ``(i) an explanation that a consumer report 
                        is being obtained for employment purposes;
                          ``(ii) the reasons for obtaining such a 
                        report; and
                          ``(iii) the citation to the applicable 
                        Federal, State, or local law or regulation 
                        described in subparagraph (A)(i)(I).
                  ``(C) Adverse actions.--In using a consumer report 
                described in subparagraph (A) for employment purposes 
                and before taking an adverse action based in whole or 
                in part on the report, the person intending to take 
                such adverse action shall, in addition to the 
                information described in paragraph (3), provide to the 
                consumer to whom the report relates--
                          ``(i) the name, address, and telephone number 
                        of the consumer reporting agency that furnished 
                        the report (including, for a consumer reporting 
                        agency that compiles and maintains files on 
                        consumers on a nationwide basis, a toll-free 
                        telephone number established by such agency);
                          ``(ii) the date on which the report was 
                        furnished; and
                          ``(iii) the specific factors from the report 
                        upon which the adverse action (as defined in 
                        section 603(k)(1)(B)(ii)) was based.
                  ``(D) National security investigations.--The 
                requirements of paragraph (4) shall apply to a consumer 
                report described under subparagraph (A).
                  ``(E) Non-circumvention.--With respect to a consumer 
                report in which any information contained in the report 
                bears on the consumer's creditworthiness, credit 
                standing, or credit capacity, if a person is prohibited 
                from using the consumer report pursuant to subparagraph 
                (A), such person may not, directly or indirectly, 
                either orally or in writing, require, request, suggest, 
                or cause any employee or prospective employee to submit 
                such information to the person as a condition of 
                employment.
                  ``(F) Non-waiver.--A consumer may not waive the 
                requirements of this paragraph with respect to a 
                consumer report.
          ``(6) Rule of construction.--Nothing in this subsection shall 
        be construed to require a consumer reporting agency to prevent 
        a Federal, State, or local law enforcement agency from 
        accessing information in a consumer report to which the law 
        enforcement agency could otherwise obtain access.''.
  (b) Technical Amendment.--The Fair Credit Reporting Act (15 U.S.C. 
1681 et seq.) is amended by striking ``section 604(b)(4)(E)(i)'' each 
place such term appears and inserting ``section 604(b)(4)(D)(i)''.
  (c) Rule of Construction.--The amendments made by this Act may not be 
construed as limiting the ability of a person to use non-financial or 
non-credit related consumer report information.
  (d) Rulemaking.--Not later than the end of the 2-year period 
beginning on the date of the enactment of this Act, the Bureau of 
Consumer Financial Protection shall issue final rules to implement the 
amendments made by this Act.
  (e) Effective Date.--The amendments made by this section shall take 
effect 2 years after the date of the enactment of this Act.

                          Purpose and Summary

    On July 2, 2019, Representative Al Lawson introduced 
H.R.3614, ``Restricting Credit Checks for Employment Decisions 
Act,'' which would prohibit current and prospective employers 
from using credit reports for employment decisions, except when 
a credit report is required by local, state, or Federal law or 
for a national security clearance.

                  Background and Need for Legislation

    Our nation's credit reporting system impacts almost every 
American. Credit scores and credit reports are increasingly 
relied upon by creditors, employers, insurers, and even law 
enforcement. Yet it has been more than 15 years since Congress 
enacted comprehensive reform of the consumer reporting 
system,\1\ and numerous shortcomings with the current system 
have been identified during that time that need to be 
addressed. For example, a 2012 Federal Trade Commission (FTC) 
study found that one out of every five consumers have a 
verified error on their consumer reports and 5 percent had 
errors serious enough to result in them being denied credit or 
paying more for mortgages, auto loans, insurance policies, and 
other financial obligations.\2\ An analysis of the Consumer 
Financial Protection Bureau's (CFPB) consumer complaint 
database in 2018 revealed that credit reports were the most 
complained about financial product, and the three major credit 
bureaus--Equifax, Experian and TransUnion--were the financial 
companies with the most complaints.\3\ These critical flaws 
must be addressed and the Fair Credit Reporting Act must be 
modernized to ensure the credit reporting system works better 
for all Americans.
---------------------------------------------------------------------------
    \1\The Fair and Accurate Credit Transactions Act of 2003 (FACT Act; 
P.L. 108-159), among other things, allows consumers to request and 
obtain a free credit report once a year from each of the three 
nationwide consumer reporting agencies.
    \2\https://www.ftc.gov/sites/default/files/documents/reports/
section-319-fair-and-accurate-credit-transactions-act-2003-fifth-
interim-federal-trade-commission/130211factareport.pdf
    \3\https://uspirg.org/news/usp/youre-not-alone-cfpb-complaints-rise
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    With respect to H.R. 3614, an individual's credit history 
has been shown to inadequately predict their job 
performance.\4\ Nevertheless, credit information is 
increasingly used by employers for hiring, promotion, and 
retention. Those who have been unemployed for an extended 
period of time, and whose credit standing has been damaged 
because they were unable to pay their bills, cannot secure a 
new job to end their financial distress because prospective 
employers conduct credit checks as part of an application 
process. A 2013 Demos survey of low- to middle-income 
households with credit card debt found that one in seven 
respondents who were unemployed had been told by a prospective 
employer that their credit history contributed to an adverse 
employment decision.\5\
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    \4\Andrew Weaver, Is Credit Status a Good Signal of Productivity? 
(2014), available at https://pdfs.semanticscholar.org/9e01/
a6a4343604f7b80bbeb4ad5e56e2336a6df4.pdf.
    \5\Amy Traub, Discredited, How Employment Credit Check Keep 
Qualified Workers Out of a Job, Demos 3 (2013), available at http://
www.demos.org/sites/default/files/publications/Discredited-Demos.pdf.
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    This practice creates obstacles for upward mobility and can 
be an invasion of consumer privacy. A 2016 report found that 
the use of credit reports unnecessarily exposes consumers' 
financial information and potentially puts existing employees 
and job applicants in an uncomfortable position of having to 
discuss private matters, such as divorce, domestic abuse, or 
health/genetic conditions, in explaining their impaired credit 
history.\6\
---------------------------------------------------------------------------
    \6\Amy Traub, Bad Credit Shouldn't Block Employment: How to Make 
State Bans on Employment Credit Checks More Effective, Demos (2016), 
available at https://www.demos.org/research/bad-credit-shouldnt-block-
employment-how-make-state-bans-employment-credit-checks-more.
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    This legislation is supported by more than 80 consumer, 
civil rights, labor, and community organizations from across 
the United states.\7\
---------------------------------------------------------------------------
    \7\Supporting organizations include Americans for Financial Reform, 
A2Z Real Estate Consultants, African American Health Alliance, Alaska 
Public Interest Research Group, Allied Progress, Arkansas Community 
Organizations, BREAD Organization, CAFE Montgomery MD, Center for 
Digital Democracy, Cleveland Jobs with Justice, Community Action Human 
Resources Agency (CAHRA), Congregation of Our Lady of the Good 
Shepherd, US Provinces, Connecticut, Fair Housing Center, Consumer 
Action, Consumer Federation of America, Consumer Federation of 
California, Consumer Reports, CWA Local 1081, Delaware Community 
Reinvestment Action Council, Inc., Demos, Denver Area Labor Federation, 
East Bay Community Law Center, FAITH IN TEXAS, Famicos Foundation, 
FLARA, Florida Alliance for Consumer Protection, Greater Longview 
United Way, Groundcover News, Habitat for Humanity of Camp Co, TX, 
Hawaiian Community Assets, Housing Action Illinois, Housing and Family 
Services of Greater New York, Inc., Mary House, Inc., Maryland Consumer 
Rights Coalition, Miami Valley Fair Housing Center, Inc., Mobilization 
for Justice Inc., Montana Organizing Project, Multi-Cultural Real 
Estate Alliance For Urban Change, National Advocacy Center of the 
Sisters of the Good Shepherd, National Association of Consumer 
Advocates, National Association of Social Workers, National Association 
of Social Workers West Virginia Chapter, National Center for Law and 
Economic Justice, National Consumer Law Center (on behalf of its low-
income clients), National Fair Housing Alliance, National Housing Law 
Project, National Housing Resource Center, National Rural Social Work 
Caucus, New Economics for Women, New Jersey Citizen Action, New Jersey 
Tenants Organization, New York Legal Assistance Group, North Carolina 
Council of Churches, Partners In Community Building, Inc., PathWays PA, 
Pennsylvania Council of Churches, People Demanding Action, Progressive 
Leadership Alliance of Nevada, Project IRENE, Prosperity Now, Public 
Citizen, Public Justice Center, Public Law Center, Public Utility Law 
Project of New York, Rocky Mountain Peace and Justice Center, SC 
Appleseed Legal Justice Center, Sisters of Mercy South Central 
Community, Society of St. Vincent de Paul, St. Paul UMC, Tennessee 
Citizen Action, The Center for Survivor Agency and Justice, The 
Disaster Law Project, The Greenlining Institute, The Leadership 
Conference on Civil and Human Rights, THE ONE LESS FOUNDATION, Tzedek 
DC, U.S. PIRG, Urban Asset Builders, Inc., Virginia Citizens Consumer 
Council, Virginia Poverty Law Center, West Virginia Center on Budget 
and Policy, Wildfire, Woodstock Institute, and WV Citizen Action Group. 
See http://ourfinancialsecurity.org/2019/07/news-release-afr-statement-
financial-services-committee-markup-credit-reporting/.
---------------------------------------------------------------------------
    This legislation is substantially similar to Title II of 
the discussion draft of Chairwoman Maxine Waters' legislation, 
the ``Comprehensive Consumer Credit Reporting Reform Act of 
2019,'' which was considered at a full committee hearing on 
February 26, 2019 and was introduced in previous congresses.\8\
---------------------------------------------------------------------------
    \8\Financial Services Committee Hearing: Who's Keeping Score? 
Holding Credit Bureaus Accountable and Repairing a Broken System 
(2019). Hearing information available at https://
financialservices.house.gov/calendar/eventsingle.aspx?EventID=402343. 
Also see H.R. 5282 (114th Congress), the Comprehensive Consumer Credit 
Reporting Reform Act of 2016, introduced by Rep. Waters on May 19, 
2016, and H.R.3755 (115th Congress), the Comprehensive Consumer Credit 
Reporting Reform Act of 2017, introduced by Rep. Waters on September 
13, 2017, available with additional materials at https://
financialservices.house.gov/news/documentsingle.aspx?DocumentID=400788.
---------------------------------------------------------------------------

                      Section-by-Section Analysis


Section 1. Short title

    This section provides that H.R. 3614 may be cited as the 
``Restricting Credit Checks for Employment Decisions Act''.

Section 2. Findings

    This section highlights the most recent data on the 
challenges that consumers with thin or poor credit profiles 
have when finding employment. This section cites studies 
showing that credit history is not generally dispositive of job 
performance, and how employer requested credit checks can 
violate consumer privacy. This section also highlights the 
negative impact that unnecessary employer requested credit 
checks have on African-American and Latino households, who on 
average have lower credit scores than whites.

Section 3. Prohibition on the use of credit information for most 
        employment decisions

    This section adds a new subtitle to and redesignates 
certain sections of Section 604 of the Fair Credit Reporting 
Act.
    The amendments made by this section prohibit employers from 
furnishing a consumer report with respect to any consumer 
unless they are required to obtain the report by local, state, 
or federal law or with respect to a national security 
investigation. This section also prevents employers from using 
such reports as a condition of employment and ensures that any 
of the costs associated with obtaining the consumer report will 
not be passed on to the consumer to whom the report relates.

                                Hearings

    For the purposes of section 103(i) of H. Res. 6 for the 
116th Congress--
    (1) The Committee on Financial Services held a hearing, 
entitled ``Who's Keeping Score? Holding Credit Bureaus 
Accountable and Repairing a Broken System'' to consider the 
``Comprehensive Consumer Credit Reporting Reform Act of 2019'' 
(Title II of the discussion draft is substantially similar to 
H.R. 3614) on February 26, 2019. The two-panel hearing 
consisted of first the three CEOs of the three largest Credit 
Reporting Agencies: Equifax, TransUnion, and Experian. 
Witnesses on the second panel included representatives from the 
National Fair Housing Alliance, the National Consumer Law 
Center, UnidosUS, U.S. Public Interest Research Group (PIRG), 
and a Paul Hastings partner and attorney. The hearing allowed 
Members of the Financial Services Committee to hear from 
witnesses about the continuing challenges modernizing the Fair 
Credit Reporting Act to better protect consumers and their 
data, as well as other legislation to help overcome those 
challenges.
    (2) The Committee on Financial Services' taskforce on 
Financial Technology held a hearing, entitled ``Examining the 
Use of Alternative Data in Underwriting and Credit Scoring to 
Expand Access to Credit'' on July 25, 2019 to discuss emerging 
technologies and how they impact access to credit, and their 
impact across communities. The panel consisted of 
representatives from the National Consumer Law Center, Tulane 
University Law School, The Government Accountability Office 
(GAO), Upstart, and Upturn.
    (3) In addition, during the 115th Congress, the Financial 
Services Committee held a two-part hearing on the Equifax data 
breach and related credit reporting and consumer data 
protection issues. The first part of the hearing entitled 
``Examining the Equifax Data Breach'' took place on October 5, 
2017 and featured the former Chairman and CEO of Equifax. The 
Committee also held a Minority Day hearing, which was a 
continuation of the hearing entitled, ``Examining the Equifax 
Data Breach'' and took place on October 25, 2017. Witnesses 
included representatives from the Consumer Financial Protection 
Bureau, the National Consumer Law Center, Georgetown University 
Law Center, and the Office of the New York State Attorney 
General.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
July 11, 2019, and ordered H.R. 3614 to be reported favorably 
to the House with an amendment in the nature of a substitute by 
a vote of 32 yeas and 26 nays, a quorum being present.

                  Committee Votes and Roll Call Votes

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
following roll call votes occurred during the Committee's 
consideration of H.R. 3614:

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the Committee's oversight findings and recommendations are 
reflected in the descriptive portions of this report.

             Statement of Performance Goals and Objectives

    Pursuant to clause (3)(c) of rule XIII of the Rules of the 
House of Representatives, the goals of H.R. 3614 are to 
increase opportunities for employment for consumers across the 
United States.

                 New Budget Authority and CBO Estimate

    Pursuant to clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives and section 308(a) of the 
Congressional Budget Act of 1974, and pursuant to clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 402 of the Congressional Budget Act 
of 1974, the Committee has received the following estimate for 
H.R. 3614 from the Director of the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 27, 2019.
Hon. Maxine Waters,
Chairwoman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Madam Chairwoman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3614, the 
Restricting Credit Checks for Employment Decisions Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is David Hughes.
            Sincerely,
                                         Phillip L. Swagel,
                                                          Director.
    Enclosure.

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    H.R. 3614 would allow consumer reporting agencies (CRAs) to 
provide consumer credit reports to employers for use in making 
employment decisions about current or prospective employees, 
only if such a report is required by a federal, state, or local 
law or regulation. Reports used in connection with a national 
security investigation also would be allowed. The bill also 
would prohibit employers from directly or indirectly requiring 
a current or prospective employee to submit credit information 
as a condition of employment. The Consumer Financial Protection 
Bureau (CFPB) would issue rules to implement the bill's 
requirements.
    Using information from the CFPB, CBO estimates that the 
agency would need four additional employees at an annual cost 
of $200,000 per employee to issue rules in the first year after 
enactment. Thus, CBO estimates that enacting H.R. 3614 would 
cost $1 million over the 2019-2029 period. The CFPB is 
permanently authorized to receive whatever amounts it needs 
from the Federal Reserve to carry out its operations; it may 
spend those amounts without appropriation.
    H.R. 3614 contains private-sector mandates as defined in 
the Unfunded Mandates Reform Act (UMRA). CBO estimates that the 
cost of the mandates would be below the threshold established 
in UMRA ($164 million in 2019, adjusted annually for 
inflation).
    The bill would impose a mandate on CRAs by prohibiting them 
from issuing consumer credit reports for employees or job 
candidates to current or prospective employers. The cost of the 
mandate would include the value of forgone income from the sale 
of consumer reports to employers. Using information from 
industry sources, CBO expects the loss in revenue would be 
roughly $40 million annually.
    H.R. 3614 also would impose a mandate on employers by 
limiting the circumstances when job candidates and employees 
could be asked for their credit history as a condition of 
employment. The bill would allow employers to request an 
employee's (or potential employee's) consumer report only for 
national security clearances or when otherwise required by 
state, local, or federal law. The bill would require employers 
in those circumstances to disclose to the affected employee 
information about the request and the outcome of the consumer 
report. That disclosure requirement would be a mandate as 
defined in UMRA. The incremental cost of the mandate would be 
small because the mandated entities already collect or possess 
the information required to be disclosed under the bill.
    The bill contains no intergovernmental mandates as defined 
in UMRA.
    The CBO staff contacts for this estimate are David Hughes 
(for federal costs) and Rachel Austin (for mandates). The 
estimate was reviewed by H. Samuel Papenfuss, Deputy Assistant 
Director for Budget Analysis.

                        Committee Cost Estimate

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison of the 
costs that would be incurred in carrying out H.R. 3614. 
However, clause 3(d)(2)(B) of that rule provides that this 
requirement does not apply when the committee has included in 
its report a timely submitted cost estimate of the bill 
prepared by the Director of the Congressional Budget Office 
under section 402 of the Congressional Budget Act.

                       Unfunded Mandate Statement

    Pursuant to Section 423 of the Congressional Budget and 
Impoundment Control Act (as amended by Section 101(a)(2) of the 
Unfunded Mandates Reform Act, Pub. L. 104-4), the Committee 
adopts as its own the estimate of federal mandates regarding 
H.R. 3614, as amended, prepared by the Director of the 
Congressional Budget Office.

                           Advisory Committee

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

              Application of Law to the Legislative Branch

    H.R. 3614 does not apply to terms and conditions of 
employment or to access to public services or accommodations 
within the legislative branch.

                           Earmark Statement

    In accordance with clause 9 of rule XXI of the Rules of the 
House of Representatives, H.R. 3614 does not contain any 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as described in clauses 9(e), 9(f), and 9(g) of rule 
XXI.

                    Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, the Committee states that no 
provision of H.R. 3614 establishes or reauthorizes a program of 
the Federal Government known to be duplicative of another 
federal program, a program that was included in any report from 
the Government Accountability Office to Congress pursuant to 
section 21 of Public Law 111-139, or a program related to a 
program identified in the most recent Catalog of Federal 
Domestic Assistance.

          Changes in Existing Law Made by the Bill as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, H.R. 3614, as reported, are shown as follows:

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                       FAIR CREDIT REPORTING ACT



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TITLE VI--CONSUMER CREDIT REPORTING

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Sec. 604. Permissible purposes of reports

  (a) In General.--Subject to subsection (c), any consumer 
reporting agency may furnish a consumer report under the 
following circumstances and no other:
          (1) In response to the order of a court having 
        jurisdiction to issue such an order, or a subpoena 
        issued in connection with proceedings before a Federal 
        grand jury.
          (2) In accordance with the written instructions of 
        the consumer to whom it relates.
          (3) To a person which it has reason to believe--
                  (A) intends to use the information in 
                connection with a credit transaction involving 
                the consumer on whom the information is to be 
                furnished and involving the extension of credit 
                to, or review or collection of an account of, 
                the consumer; or
                  (B) intends to use the information for 
                employment purposes, subject to the 
                requirements of subsection (b); or
                  (C) intends to use the information in 
                connection with the underwriting of insurance 
                involving the consumer; or
                  (D) intends to use the information in 
                connection with a determination of the 
                consumer's eligibility for a license or other 
                benefit granted by a governmental 
                instrumentality required by law to consider an 
                applicant's financial responsibility or status; 
                or
                  (E) intends to use the information, as a 
                potential investor or servicer, or current 
                insurer, in connection with a valuation of, or 
                an assessment of the credit or prepayment risks 
                associated with, an existing credit obligation; 
                or
                  (F) otherwise has a legitimate business need 
                for the information--
                          (i) in connection with a business 
                        transaction that is initiated by the 
                        consumer; or
                          (ii) to review an account to 
                        determine whether the consumer 
                        continues to meet the terms of the 
                        account.
                  (G) executive departments and agencies in 
                connection with the issuance of government-
                sponsored individually-billed travel charge 
                cards.
          (4) In response to a request by the head of a State 
        or local child support enforcement agency (or a State 
        or local government official authorized by the head of 
        such an agency), if the person making the request 
        certifies to the consumer reporting agency that--
                  (A) the consumer report is needed for the 
                purpose of establishing an individual's 
                capacity to make child support payments, 
                determining the appropriate level of such 
                payments, or enforcing a child support order, 
                award, agreement, or judgment;
                  (B) the parentage of the consumer for the 
                child to which the obligation relates has been 
                established or acknowledged by the consumer in 
                accordance with State laws under which the 
                obligation arises (if required by those laws); 
                and
                  (C) the consumer report will be kept 
                confidential, will be used solely for a purpose 
                described in subparagraph (A), and will not be 
                used in connection with any other civil, 
                administrative, or criminal proceeding, or for 
                any other purpose.
          (5) To an agency administering a State plan under 
        section 454 of the Social Security Act (42 U.S.C. 654) 
        for use to set an initial or modified child support 
        award.
          (6) To the Federal Deposit Insurance Corporation or 
        the National Credit Union Administration as part of its 
        preparation for its appointment or as part of its 
        exercise of powers, as conservator, receiver, or 
        liquidating agent for an insured depository institution 
        or insured credit union under the Federal Deposit 
        Insurance Act or the Federal Credit Union Act, or other 
        applicable Federal or State law, or in connection with 
        the resolution or liquidation of a failed or failing 
        insured depository institution or insured credit union, 
        as applicable.
  (b) Conditions for Furnishing and Using Consumer Reports for 
Employment Purposes.--
          (1)  [Certification from user.--] Use of consumer 
        reports for employment purposes._A consumer reporting 
        [agency may furnish] agency--
                  (A) may furnish  a consumer report for 
                employment purposes only if--
                          [(A)] (i) the person who obtains such 
                        report from the agency certifies to the 
                        agency that--
                                  [(i)] (I) the person has 
                                complied with paragraph (2) 
                                with respect to the consumer 
                                report, and the person will 
                                comply with paragraph (3) with 
                                respect to the consumer report 
                                if paragraph (3) becomes 
                                applicable; and
                                  [(ii)] (II) information from 
                                the consumer report will not be 
                                used in violation of any 
                                applicable Federal or State 
                                equal employment opportunity 
                                law or regulation; and
                          [(B)] (ii) the consumer reporting 
                        agency provides with the report, or has 
                        previously provided, a summary of the 
                        consumer's rights under this title, as 
                        prescribed by the Bureau under section 
                        609(c)(3)[.]; and
                  (B) except as provided in paragraph (5), may 
                not furnish a consumer report with respect to 
                any consumer in which any information contained 
                in the report bears on the consumer's 
                creditworthiness, credit standing, or credit 
                capacity.
          (2) Disclosure to consumer.--
                  (A) In general.--Except as provided in 
                subparagraph (B), a person may not procure a 
                consumer report, or cause a consumer report to 
                be procured, for employment purposes with 
                respect to any consumer, unless--
                          (i) a clear and conspicuous 
                        disclosure has been made in writing to 
                        the consumer at any time before the 
                        report is procured or caused to be 
                        procured, in a document that consists 
                        solely of the disclosure, that a 
                        consumer report may be obtained for 
                        employment purposes; and
                          (ii) the consumer has authorized in 
                        writing (which authorization may be 
                        made on the document referred to in 
                        clause (i)) the procurement of the 
                        report by that person.
                  (B) Application by mail, telephone, computer, 
                or other similar means.--If a consumer 
                described in subparagraph (C) applies for 
                employment by mail, telephone, computer, or 
                other similar means, at any time before a 
                consumer report is procured or caused to be 
                procured in connection with that application--
                          (i) the person who procures the 
                        consumer report on the consumer for 
                        employment purposes shall provide to 
                        the consumer, by oral, written, or 
                        electronic means, notice that a 
                        consumer report may be obtained for 
                        employment purposes, and a summary of 
                        the consumer's rights under section 
                        615(a)(3); and
                          (ii) the consumer shall have 
                        consented, orally, in writing, or 
                        electronically to the procurement of 
                        the report by that person.
                  (C) Scope.--Subparagraph (B) shall apply to a 
                person procuring a consumer report on a 
                consumer in connection with the consumer's 
                application for employment only if--
                          (i) the consumer is applying for a 
                        position over which the Secretary of 
                        Transportation has the power to 
                        establish qualifications and maximum 
                        hours of service pursuant to the 
                        provisions of section 31502 of title 
                        49, or a position subject to safety 
                        regulation by a State transportation 
                        agency; and
                          (ii) as of the time at which the 
                        person procures the report or causes 
                        the report to be procured the only 
                        interaction between the consumer and 
                        the person in connection with that 
                        employment application has been by 
                        mail, telephone, computer, or other 
                        similar means.
          (3) Conditions on use for adverse actions.--
                  (A) In general.--Except as provided in 
                subparagraph (B), in using a consumer report 
                for employment purposes, before taking any 
                adverse action based in whole or in part on the 
                report, the person intending to take such 
                adverse action shall provide to the consumer to 
                whom the report relates--
                          (i) a copy of the report; and
                          (ii) a description in writing of the 
                        rights of the consumer under this 
                        title, as prescribed by the Bureau 
                        under section 609(c)(3).
                  (B) Application by mail, telephone, computer, 
                or other similar means.--
                          (i) If a consumer described in 
                        subparagraph (C) applies for employment 
                        by mail, telephone, computer, or other 
                        similar means, and if a person who has 
                        procured a consumer report on the 
                        consumer for employment purposes takes 
                        adverse action on the employment 
                        application based in whole or in part 
                        on the report, then the person must 
                        provide to the consumer to whom the 
                        report relates, in lieu of the notices 
                        required under subparagraph (A) of this 
                        section and under section 615(a), 
                        within 3 business days of taking such 
                        action, an oral, written or electronic 
                        notification--
                                  (I) that adverse action has 
                                been taken based in whole or in 
                                part on a consumer report 
                                received from a consumer 
                                reporting agency;
                                  (II) of the name, address and 
                                telephone number of the 
                                consumer reporting agency that 
                                furnished the consumer report 
                                (including a toll-free 
                                telephone number established by 
                                the agency if the agency 
                                compiles and maintains files on 
                                consumers on a nationwide 
                                basis);
                                  (III) that the consumer 
                                reporting agency did not make 
                                the decision to take the 
                                adverse action and is unable to 
                                provide to the consumer the 
                                specific reasons why the 
                                adverse action was taken; and
                                  (IV) that the consumer may, 
                                upon providing proper 
                                identification, request a free 
                                copy of a report and may 
                                dispute with the consumer 
                                reporting agency the accuracy 
                                or completeness of any 
                                information in a report.
                          (ii) If, under clause (B)(i)(IV), the 
                        consumer requests a copy of a consumer 
                        report from the person who procured the 
                        report, then, within 3 business days of 
                        receiving the consumer's request, 
                        together with proper identification, 
                        the person must send or provide to the 
                        consumer a copy of a report and a copy 
                        of the consumer's rights as prescribed 
                        by the Bureau under section 609(c)(3).
                  (C) Scope.--Subparagraph (B) shall apply to a 
                person procuring a consumer report on a 
                consumer in connection with the consumer's 
                application for employment only if--
                          (i) the consumer is applying for a 
                        position over which the Secretary of 
                        Transportation has the power to 
                        establish qualifications and maximum 
                        hours of service pursuant to the 
                        provisions of section 31502 of title 
                        49, or a position subject to safety 
                        regulation by a State transportation 
                        agency; and
                          (ii) as of the time at which the 
                        person procures the report or causes 
                        the report to be procured the only 
                        interaction between the consumer and 
                        the person in connection with that 
                        employment application has been by 
                        mail, telephone, computer, or other 
                        similar means.
          (4) Exception for national security investigations.--
                  (A) In general.--In the case of an agency or 
                department of the United States Government 
                which seeks to obtain and use a consumer report 
                for employment purposes, paragraph (3) shall 
                not apply to any adverse action by such agency 
                or department which is based in part on such 
                consumer report, if the head of such agency or 
                department makes a written finding that--
                          (i) the consumer report is relevant 
                        to a national security investigation of 
                        such agency or department;
                          (ii) the investigation is within the 
                        jurisdiction of such agency or 
                        department;
                          (iii) there is reason to believe that 
                        compliance with paragraph (3) will--
                                  (I) endanger the life or 
                                physical safety of any person;
                                  (II) result in flight from 
                                prosecution;
                                  (III) result in the 
                                destruction of, or tampering 
                                with, evidence relevant to the 
                                investigation;
                                  (IV) result in the 
                                intimidation of a potential 
                                witness relevant to the 
                                investigation;
                                  (V) result in the compromise 
                                of classified information; or
                                  (VI) otherwise seriously 
                                jeopardize or unduly delay the 
                                investigation or another 
                                official proceeding.
                  (B) Notification of consumer upon conclusion 
                of investigation.--Upon the conclusion of a 
                national security investigation described in 
                subparagraph (A), or upon the determination 
                that the exception under subparagraph (A) is no 
                longer required for the reasons set forth in 
                such subparagraph, the official exercising the 
                authority in such subparagraph shall provide to 
                the consumer who is the subject of the consumer 
                report with regard to which such finding was 
                made--
                          (i) a copy of such consumer report 
                        with any classified information 
                        redacted as necessary;
                          (ii) notice of any adverse action 
                        which is based, in part, on the 
                        consumer report; and
                          (iii) the identification with 
                        reasonable specificity of the nature of 
                        the investigation for which the 
                        consumer report was sought.
                  (C) Delegation by head of agency or 
                department.--For purposes of subparagraphs (A) 
                and (B), the head of any agency or department 
                of the United States Government may delegate 
                his or her authorities under this paragraph to 
                an official of such agency or department who 
                has personnel security responsibilities and is 
                a member of the Senior Executive Service or 
                equivalent civilian or military rank.
                  (D) Definitions.--For purposes of this 
                paragraph, the following definitions shall 
                apply:
                          (i) Classified information.--The term 
                        ``classified information'' means 
                        information that is protected from 
                        unauthorized disclosure under Executive 
                        Order No. 12958 or successor orders.
                          (ii) National security 
                        investigation.--The term ``national 
                        security investigation'' means any 
                        official inquiry by an agency or 
                        department of the United States 
                        Government to determine the eligibility 
                        of a consumer to receive access or 
                        continued access to classified 
                        information or to determine whether 
                        classified information has been lost or 
                        compromised.
          (5) Requirements for consumer reports bearing on the 
        consumer's creditworthiness, credit standing, or credit 
        capacity.--
                  (A) In general.--A person may use a consumer 
                report with respect to any consumer in which 
                any information contained in the report bears 
                on the consumer's creditworthiness, credit 
                standing, or credit capacity only if--
                          (i) either--
                                  (I) the person is required to 
                                obtain the report by a Federal, 
                                State, or local law or 
                                regulation; or
                                  (II) the information 
                                contained in the report is 
                                being used with respect to a 
                                national security investigation 
                                (as defined in paragraph 
                                (4)(D));
                          (ii) none of the cost associated with 
                        obtaining the consumer report will be 
                        passed on to the consumer to whom the 
                        report relates; and
                          (iii) the information contained in 
                        the consumer report will not be 
                        disclosed to any other person other 
                        than--
                                  (I) in an aggregate format 
                                that protects a consumer's 
                                personally identifiable 
                                information; or
                                  (II) as may be necessary to 
                                comply with any applicable 
                                Federal, State, or local equal 
                                employment opportunity law or 
                                regulation.
                  (B) Disclosures.--A person who procures, or 
                causes to be procured, a consumer report 
                described in subparagraph (A) for employment 
                purposes shall, in the disclosure made pursuant 
                to paragraph (2), include--
                          (i) an explanation that a consumer 
                        report is being obtained for employment 
                        purposes;
                          (ii) the reasons for obtaining such a 
                        report; and
                          (iii) the citation to the applicable 
                        Federal, State, or local law or 
                        regulation described in subparagraph 
                        (A)(i)(I).
                  (C) Adverse actions.--In using a consumer 
                report described in subparagraph (A) for 
                employment purposes and before taking an 
                adverse action based in whole or in part on the 
                report, the person intending to take such 
                adverse action shall, in addition to the 
                information described in paragraph (3), provide 
                to the consumer to whom the report relates--
                          (i) the name, address, and telephone 
                        number of the consumer reporting agency 
                        that furnished the report (including, 
                        for a consumer reporting agency that 
                        compiles and maintains files on 
                        consumers on a nationwide basis, a 
                        toll-free telephone number established 
                        by such agency);
                          (ii) the date on which the report was 
                        furnished; and
                          (iii) the specific factors from the 
                        report upon which the adverse action 
                        (as defined in section 
                        603(k)(1)(B)(ii)) was based.
                  (D) National security investigations.--The 
                requirements of paragraph (4) shall apply to a 
                consumer report described under subparagraph 
                (A).
                  (E) Non-circumvention.--With respect to a 
                consumer report in which any information 
                contained in the report bears on the consumer's 
                creditworthiness, credit standing, or credit 
                capacity, if a person is prohibited from using 
                the consumer report pursuant to subparagraph 
                (A), such person may not, directly or 
                indirectly, either orally or in writing, 
                require, request, suggest, or cause any 
                employee or prospective employee to submit such 
                information to the person as a condition of 
                employment.
                  (F) Non-waiver.--A consumer may not waive the 
                requirements of this paragraph with respect to 
                a consumer report.
          (6) Rule of construction.--Nothing in this subsection 
        shall be construed to require a consumer reporting 
        agency to prevent a Federal, State, or local law 
        enforcement agency from accessing information in a 
        consumer report to which the law enforcement agency 
        could otherwise obtain access.
  (c) Furnishing Reports in Connection With Credit or Insurance 
Transactions That Are Not Initiated by the Consumer.--
          (1) In general.--A consumer reporting agency may 
        furnish a consumer report relating to any consumer 
        pursuant to subparagraph (A) or (C) of subsection 
        (a)(3) in connection with any credit or insurance 
        transaction that is not initiated by the consumer only 
        if--
                  (A) the consumer authorizes the agency to 
                provide such report to such person; or
                  (B)(i) the transaction consists of a firm 
                offer of credit or insurance;
                  (ii) the consumer reporting agency has 
                complied with subsection (e);
                  (iii) there is not in effect an election by 
                the consumer, made in accordance with 
                subsection (e), to have the consumer's name and 
                address excluded from lists of names provided 
                by the agency pursuant to this paragraph; and
                  (iv) the consumer report does not contain a 
                date of birth that shows that the consumer has 
                not attained the age of 21, or, if the date of 
                birth on the consumer report shows that the 
                consumer has not attained the age of 21, such 
                consumer consents to the consumer reporting 
                agency to such furnishing.
          (2) Limits on information received under paragraph 
        (1)(b).--A person may receive pursuant to paragraph 
        (1)(B) only--
                  (A) the name and address of a consumer;
                  (B) an identifier that is not unique to the 
                consumer and that is used by the person solely 
                for the purpose of verifying the identity of 
                the consumer; and
                  (C) other information pertaining to a 
                consumer that does not identify the 
                relationship or experience of the consumer with 
                respect to a particular creditor or other 
                entity.
          (3) Information regarding inquiries.--Except as 
        provided in section 609(a)(5), a consumer reporting 
        agency shall not furnish to any person a record of 
        inquiries in connection with a credit or insurance 
        transaction that is not initiated by a consumer.
  (d) Reserved.--
  (e) Election of Consumer To Be Excluded From Lists.--
          (1) In general.--A consumer may elect to have the 
        consumer's name and address excluded from any list 
        provided by a consumer reporting agency under 
        subsection (c)(1)(B) in connection with a credit or 
        insurance transaction that is not initiated by the 
        consumer by notifying the agency in accordance with 
        paragraph (2) that the consumer does not consent to any 
        use of a consumer report relating to the consumer in 
        connection with any credit or insurance transaction 
        that is not initiated by the consumer.
          (2) Manner of notification.--A consumer shall notify 
        a consumer reporting agency under paragraph (1)--
                  (A) through the notification system 
                maintained by the agency under paragraph (5); 
                or
                  (B) by submitting to the agency a signed 
                notice of election form issued by the agency 
                for purposes of this subparagraph.
          (3) Response of agency after notification through 
        system.--Upon receipt of notification of the election 
        of a consumer under paragraph (1) through the 
        notification system maintained by the agency under 
        paragraph (5), a consumer reporting agency shall--
                  (A) inform the consumer that the election is 
                effective only for the 5-year period following 
                the election if the consumer does not submit to 
                the agency a signed notice of election form 
                issued by the agency for purposes of paragraph 
                (2)(B); and
                  (B) provide to the consumer a notice of 
                election form, if requested by the consumer, 
                not later than 5 business days after receipt of 
                the notification of the election through the 
                system established under paragraph (5), in the 
                case of a request made at the time the consumer 
                provides notification through the system.
          (4) Effectiveness of election.--An election of a 
        consumer under paragraph (1)--
                  (A) shall be effective with respect to a 
                consumer reporting agency beginning 5 business 
                days after the date on which the consumer 
                notifies the agency in accordance with 
                paragraph (2);
                  (B) shall be effective with respect to a 
                consumer reporting agency--
                          (i) subject to subparagraph (C), 
                        during the 5-year period beginning 5 
                        business days after the date on which 
                        the consumer notifies the agency of the 
                        election, in the case of an election 
                        for which a consumer notifies the 
                        agency only in accordance with 
                        paragraph (2)(A); or
                          (ii) until the consumer notifies the 
                        agency under subparagraph (C), in the 
                        case of an election for which a 
                        consumer notifies the agency in 
                        accordance with paragraph (2)(B);
                  (C) shall not be effective after the date on 
                which the consumer notifies the agency, through 
                the notification system established by the 
                agency under paragraph (5), that the election 
                is no longer effective; and
                  (D) shall be effective with respect to each 
                affiliate of the agency.
          (5) Notification system.--
                  (A) In general.--Each consumer reporting 
                agency that, under subsection (c)(1)(B), 
                furnishes a consumer report in connection with 
                a credit or insurance transaction that is not 
                initiated by a consumer shall--
                          (i) establish and maintain a 
                        notification system, including a toll-
                        free telephone number, which permits 
                        any consumer whose consumer report is 
                        maintained by the agency to notify the 
                        agency, with appropriate 
                        identification, of the consumer's 
                        election to have the consumer's name 
                        and address excluded from any such list 
                        of names and addresses provided by the 
                        agency for such a transaction; and
                          (ii) publish by not later than 365 
                        days after the date of enactment of the 
                        Consumer Credit Reporting Reform Act of 
                        1996, and not less than annually 
                        thereafter, in a publication of general 
                        circulation in the area served by the 
                        agency--
                                  (I) a notification that 
                                information in consumer files 
                                maintained by the agency may be 
                                used in connection with such 
                                transactions; and
                                  (II) the address and toll-
                                free telephone number for 
                                consumers to use to notify the 
                                agency of the consumer's 
                                election under clause (i).
                  (B) Establishment and maintenance as 
                compliance.--Establishment and maintenance of a 
                notification system (including a toll-free 
                telephone number) and publication by a consumer 
                reporting agency on the agency's own behalf and 
                on behalf of any of its affiliates in 
                accordance with this paragraph is deemed to be 
                compliance with this paragraph by each of those 
                affiliates.
          (6) Notification system by agencies that operate 
        nationwide.--Each consumer reporting agency that 
        compiles and maintains files on consumers on a 
        nationwide basis shall establish and maintain a 
        notification system for purposes of paragraph (5) 
        jointly with other such consumer reporting agencies.
  (f) Certain Use or Obtaining of Information Prohibited.--A 
person shall not use or obtain a consumer report for any 
purpose unless--
          (1) the consumer report is obtained for a purpose for 
        which the consumer report is authorized to be furnished 
        under this section; and
          (2) the purpose is certified in accordance with 
        section 607 by a prospective user of the report through 
        a general or specific certification.
  (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 (other than medical contact 
        information treated in the manner required under 
        section 605(a)(6)) 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) the information to be furnished pertains 
                solely to transactions, accounts, or balances 
                relating to debts arising from the receipt of 
                medical services, products, or devises, 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).
          (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 (other than medical information 
        treated in the manner required under section 605(a)(6)) 
        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, by the 
                Bureau 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 paragraph (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.
          (5) Regulations and effective date for paragraph 
        (2).--
                  (A) Regulations required.--The Bureau may, 
                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 (and which shall include permitting 
                actions necessary for administrative 
                verification purposes), consistent with the 
                intent of paragraph (2) to restrict the use of 
                medical information for inappropriate purposes.
          (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.

           *       *       *       *       *       *       *


Sec. 607. Compliance procedures

  (a) Every consumer reporting agency shall maintain reasonable 
procedures designed to avoid violations of section 605 and to 
limit the furnishing of consumer reports to the purposes listed 
under section 604. These procedures shall require that 
prospective users of the information identify themselves, 
certify the purposes for which the information is sought, and 
certify that the information will be used for no other purpose. 
Every consumer reporting agency shall make a reasonable effort 
to verify the identity of a new prospective user and the uses 
certified by such prospective user prior to furnishing such 
user a consumer report. No consumer reporting agency may 
furnish a consumer report to any person if it has reasonable 
grounds for believing that the consumer report will not be used 
for a purpose listed in section 604.
  (b) Whenever a consumer reporting agency prepares a consumer 
report it shall follow reasonable procedures to assure maximum 
possible accuracy of the information concerning the individual 
about whom the report relates.
  (c) Disclosure of Consumer Reports by Users Allowed.--A 
consumer reporting agency may not prohibit a user of a consumer 
report furnished by the agency on a consumer from disclosing 
the contents of the report to the consumer, if adverse action 
against the consumer has been taken by the user based in whole 
or in part on the report.
  (d) Notice to Users and Furnishers of Information.--
          (1) Notice requirement.--A consumer reporting agency 
        shall provide to any person--
                  (A) who regularly and in the ordinary course 
                of business furnishes information to the agency 
                with respect to any consumer; or
                  (B) to whom a consumer report is provided by 
                the agency;
        a notice of such person's responsibilities under this 
        title.
          (2) Content of notice.--The Bureau shall prescribe 
        the content of notices under paragraph (1), and a 
        consumer reporting agency shall be in compliance with 
        this subsection if it provides a notice under paragraph 
        (1) that is substantially similar to the Bureau 
        prescription under this paragraph.
  (e) Procurement of Consumer Report for Resale.--
          (1) Disclosure.--A person may not procure a consumer 
        report for purposes of reselling the report (or any 
        information in the report) unless the person discloses 
        to the consumer reporting agency that originally 
        furnishes the report--
                  (A) the identity of the end-user of the 
                report (or information); and
                  (B) each permissible purpose under section 
                604 for which the report is furnished to the 
                end-user of the report (or information).
          (2) Responsibilities of procurers for resale.--A 
        person who procures a consumer report for purposes of 
        reselling the report (or any information in the report) 
        shall--
                  (A) establish and comply with reasonable 
                procedures designed to ensure that the report 
                (or information) is resold by the person only 
                for a purpose for which the report may be 
                furnished under section 604, including by 
                requiring that each person to which the report 
                (or information) is resold and that resells or 
                provides the report (or information) to any 
                other person--
                          (i) identifies each end user of the 
                        resold report (or information);
                          (ii) certifies each purpose for which 
                        the report (or information) will be 
                        used; and
                          (iii) certifies that the report (or 
                        information) will be used for no other 
                        purpose; and
                  (B) before reselling the report, make 
                reasonable efforts to verify the 
                identifications and certifications made under 
                subparagraph (A).
          (3) Resale of consumer report to a federal agency or 
        department.--Notwithstanding paragraph (1) or (2), a 
        person who procures a consumer report for purposes of 
        reselling the report (or any information in the report) 
        shall not disclose the identity of the end-user of the 
        report under paragraph (1) or (2) if--
                  (A) the end user is an agency or department 
                of the United States Government which procures 
                the report from the person for purposes of 
                determining the eligibility of the consumer 
                concerned to receive access or continued access 
                to classified information (as defined in 
                [section 604(b)(4)(E)(i)] section 
                604(b)(4)(D)(i)); and
                  (B) the agency or department certifies in 
                writing to the person reselling the report that 
                nondisclosure is necessary to protect 
                classified information or the safety of persons 
                employed by or contracting with, or undergoing 
                investigation for work or contracting with the 
                agency or department.

           *       *       *       *       *       *       *


Sec. 609. Disclosures to consumers

  (a) Every consumer reporting agency shall, upon request, and 
subject to section 610(a)(1), clearly and accurately disclose 
to the consumer:
          (1) All information in the consumer's file at the 
        time of the request, except that--
                  (A) if the consumer to whom the file relates 
                requests that the first 5 digits of the social 
                security number (or similar identification 
                number) of the consumer not be included in the 
                disclosure and the consumer reporting agency 
                has received appropriate proof of the identity 
                of the requester, the consumer reporting agency 
                shall so truncate such number in such 
                disclosure; and
                  (B) nothing in this paragraph shall be 
                construed to require a consumer reporting 
                agency to disclose to a consumer any 
                information concerning credit scores or any 
                other risk scores or predictors relating to the 
                consumer.
          (2) The sources of the information; except that the 
        sources of information acquired solely for use in 
        preparing an investigative consumer report and actually 
        used for no other purpose need not be disclosed: 
        Provided, That in the event an action is brought under 
        this title, such sources shall be available to the 
        plaintiff under appropriate discovery procedures in the 
        court in which the action is brought.
          (3)(A) Identification of each person (including each 
        end-user identified under section 607(e)(1)) that 
        procured a consumer report--
                  (i) for employment purposes, during the 2-
                year period preceding the date on which the 
                request is made; or
                  (ii) for any other purpose, during the 1-year 
                period preceding the date on which the request 
                is made.
          (B) An identification of a person under subparagraph 
        (A) shall include--
                  (i) the name of the person or, if applicable, 
                the trade name (written in full) under which 
                such person conducts business; and
                  (ii) upon request of the consumer, the 
                address and telephone number of the person.
          (C) Subparagraph (A) does not apply if--
                  (i) the end user is an agency or department 
                of the United States Government that procures 
                the report from the person for purposes of 
                determining the eligibility of the consumer to 
                whom the report relates to receive access or 
                continued access to classified information (as 
                defined in [section 604(b)(4)(E)(i)] section 
                604(b)(4)(D)(i)); and
                  (ii) the head of the agency or department 
                makes a written finding as prescribed under 
                section 604(b)(4)(A).
          (4) The dates, original payees, and amounts of any 
        checks upon which is based any adverse characterization 
        of the consumer, included in the file at the time of 
        the disclosure.
          (5) A record of all inquiries received by the agency 
        during the 1-year period preceding the request that 
        identified the consumer in connection with a credit or 
        insurance transaction that was not initiated by the 
        consumer.
          (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) The requirements of subsection (a) respecting the 
disclosure of sources of information and the recipients of 
consumer reports do not apply to information received or 
consumer reports furnished prior to the effective date of this 
title except to the extent that the matter involved is 
contained in the files of the consumer reporting agency on that 
date.
  (c) Summary of Rights To Obtain and Dispute Information in 
Consumer Reports and To Obtain Credit Scores.--
          (1) Commission summary of rights required.--
                  (A) In general.--The Commission shall prepare 
                a model summary of the rights of consumers 
                under this title.
                  (B) Content of summary.--The summary of 
                rights prepared under subparagraph (A) shall 
                include a description of--
                          (i) the right of a consumer to obtain 
                        a copy of a consumer report under 
                        subsection (a) from each consumer 
                        reporting agency;
                          (ii) the frequency and circumstances 
                        under which a consumer is entitled to 
                        receive a consumer report without 
                        charge under section 612;
                          (iii) the right of a consumer to 
                        dispute information in the file of the 
                        consumer under section 611;
                          (iv) the right of a consumer to 
                        obtain a credit score from a consumer 
                        reporting agency, and a description of 
                        how to obtain a credit score;
                          (v) the method by which a consumer 
                        can contact, and obtain a consumer 
                        report from, a consumer reporting 
                        agency without charge, as provided in 
                        the regulations of the Bureau 
                        prescribed under section 211(c) of the 
                        Fair and Accurate Credit Transactions 
                        Act of 2003; and
                          (vi) the method by which a consumer 
                        can contact, and obtain a consumer 
                        report from, a consumer reporting 
                        agency described in section 603(w), as 
                        provided in the regulations of the 
                        Bureau prescribed under section 
                        612(a)(1)(C).
                  (C) Availability of summary of rights.--The 
                Commission shall--
                          (i) actively publicize the 
                        availability of the summary of rights 
                        prepared under this paragraph;
                          (ii) conspicuously post on its 
                        Internet website the availability of 
                        such summary of rights; and
                          (iii) promptly make such summary of 
                        rights available to consumers, on 
                        request.
          (2) Summary of rights required to be included with 
        agency disclosures.--A consumer reporting agency shall 
        provide to a consumer, with each written disclosure by 
        the agency to the consumer under this section--
                  (A) the summary of rights prepared by the 
                Bureau under paragraph (1);
                  (B) in the case of a consumer reporting 
                agency described in section 603(p), a toll-free 
                telephone number established by the agency, at 
                which personnel are accessible to consumers 
                during normal business hours;
                  (C) a list of all Federal agencies 
                responsible for enforcing any provision of this 
                title, and the address and any appropriate 
                phone number of each such agency, in a form 
                that will assist the consumer in selecting the 
                appropriate agency;
                  (D) a statement that the consumer may have 
                additional rights under State law, and that the 
                consumer may wish to contact a State or local 
                consumer protection agency or a State attorney 
                general (or the equivalent thereof) to learn of 
                those rights; and
                  (E) a statement that a consumer reporting 
                agency is not required to remove accurate 
                derogatory information from the file of a 
                consumer, unless the information is outdated 
                under section 605 or cannot be verified.
  (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, an electronic fund 
        transfer, or an account or transaction at or with a 
        financial institution or other creditor.
          (2) Summary of rights and contact information.--
        Beginning 60 days after the date on which the model 
        summary of rights is prescribed in final form by the 
        Bureau pursuant to paragraph (1), 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, an electronic fund 
        transfer, or an account or transaction at or with a 
        financial institution or other creditor, the consumer 
        reporting agency shall, in addition to any other action 
        that the agency may take, provide the consumer with a 
        summary of rights that contains all of the information 
        required by the Bureau under paragraph (1), and 
        information on how to contact the Bureau to obtain more 
        detailed information.
  (e) Information Available to Victims.--
          (1) In general.--For the purpose of documenting 
        fraudulent transactions resulting from identity theft, 
        not later than 30 days after the date of receipt of a 
        request from a victim in accordance with paragraph (3), 
        and subject to verification of the identity of the 
        victim and the claim of identity theft in accordance 
        with paragraph (2), a business entity that has provided 
        credit to, provided for consideration products, goods, 
        or services to, accepted payment from, or otherwise 
        entered into a commercial transaction for consideration 
        with, a person who has allegedly made unauthorized use 
        of the means of identification of the victim, shall 
        provide a copy of application and business transaction 
        records in the control of the business entity, whether 
        maintained by the business entity or by another person 
        on behalf of the business entity, evidencing any 
        transaction alleged to be a result of identity theft 
        to--
                  (A) the victim;
                  (B) any Federal, State, or local government 
                law enforcement agency or officer specified by 
                the victim in such a request; or
                  (C) any law enforcement agency investigating 
                the identity theft and authorized by the victim 
                to take receipt of records provided under this 
                subsection.
          (2) Verification of identity and claim.--Before a 
        business entity provides any information under 
        paragraph (1), unless the business entity, at its 
        discretion, otherwise has a high degree of confidence 
        that it knows the identity of the victim making a 
        request under paragraph (1), the victim shall provide 
        to the business entity--
                  (A) as proof of positive identification of 
                the victim, at the election of the business 
                entity--
                          (i) the presentation of a government-
                        issued identification card;
                          (ii) personally identifying 
                        information of the same type as was 
                        provided to the business entity by the 
                        unauthorized person; or
                          (iii) personally identifying 
                        information that the business entity 
                        typically requests from new applicants 
                        or for new transactions, at the time of 
                        the victim's request for information, 
                        including any documentation described 
                        in clauses (i) and (ii); and
                  (B) as proof of a claim of identity theft, at 
                the election of the business entity--
                          (i) a copy of a police report 
                        evidencing the claim of the victim of 
                        identity theft; and
                          (ii) a properly completed--
                                  (I) copy of a standardized 
                                affidavit of identity theft 
                                developed and made available by 
                                the Bureau; or
                                  (II) an affidavit of fact 
                                that is acceptable to the 
                                business entity for that 
                                purpose.
          (3) Procedures.--The request of a victim under 
        paragraph (1) shall--
                  (A) be in writing;
                  (B) be mailed to an address specified by the 
                business entity, if any; and
                  (C) if asked by the business entity, include 
                relevant information about any transaction 
                alleged to be a result of identity theft to 
                facilitate compliance with this section 
                including--
                          (i) if known by the victim (or if 
                        readily obtainable by the victim), the 
                        date of the application or transaction; 
                        and
                          (ii) if known by the victim (or if 
                        readily obtainable by the victim), any 
                        other identifying information such as 
                        an account or transaction number.
          (4) No charge to victim.--Information required to be 
        provided under paragraph (1) shall be so provided 
        without charge.
          (5) Authority to decline to provide information.--A 
        business entity may decline to provide information 
        under paragraph (1) if, in the exercise of good faith, 
        the business entity determines that--
                  (A) this subsection does not require 
                disclosure of the information;
                  (B) after reviewing the information provided 
                pursuant to paragraph (2), the business entity 
                does not have a high degree of confidence in 
                knowing the true identity of the individual 
                requesting the information;
                  (C) the request for the information is based 
                on a misrepresentation of fact by the 
                individual requesting the information relevant 
                to the request for information; or
                  (D) the information requested is Internet 
                navigational data or similar information about 
                a person's visit to a website or online 
                service.
          (6) Limitation on liability.--Except as provided in 
        section 621, sections 616 and 617 do not apply to any 
        violation of this subsection.
          (7) Limitation on civil liability.--No business 
        entity may be held civilly liable under any provision 
        of Federal, State, or other law for disclosure, made in 
        good faith pursuant to this subsection.
          (8) No new recordkeeping obligation.--Nothing in this 
        subsection creates an obligation on the part of a 
        business entity to obtain, retain, or maintain 
        information or records that are not otherwise required 
        to be obtained, retained, or maintained in the ordinary 
        course of its business or under other applicable law.
          (9) Rule of construction.--
                  (A) In general.--No provision of subtitle A 
                of title V of Public Law 106-102, prohibiting 
                the disclosure of financial information by a 
                business entity to third parties shall be used 
                to deny disclosure of information to the victim 
                under this subsection.
                  (B) Limitation.--Except as provided in 
                subparagraph (A), nothing in this subsection 
                permits a business entity to disclose 
                information, including information to law 
                enforcement under subparagraphs (B) and (C) of 
                paragraph (1), that the business entity is 
                otherwise prohibited from disclosing under any 
                other applicable provision of Federal or State 
                law.
          (10) Affirmative defense.--In any civil action 
        brought to enforce this subsection, it is an 
        affirmative defense (which the defendant must establish 
        by a preponderance of the evidence) for a business 
        entity to file an affidavit or answer stating that--
                  (A) the business entity has made a reasonably 
                diligent search of its available business 
                records; and
                  (B) the records requested under this 
                subsection do not exist or are not reasonably 
                available.
          (11) Definition of victim.--For purposes of this 
        subsection, the term ``victim'' means a consumer whose 
        means of identification or financial information has 
        been used or transferred (or has been alleged to have 
        been used or transferred) without the authority of that 
        consumer, with the intent to commit, or to aid or abet, 
        an identity theft or a similar crime.
          (12) Effective date.--This subsection shall become 
        effective 180 days after the date of enactment of this 
        subsection.
          (13) Effectiveness study.--Not later than 18 months 
        after the date of enactment of this subsection, the 
        Comptroller General of the United States shall submit a 
        report to Congress assessing the effectiveness of this 
        provision.
  (f) Disclosure of Credit Scores.--
          (1) In general.--Upon the request of a consumer for a 
        credit score, a consumer reporting agency shall supply 
        to the 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--
                  (A) the current credit score of the consumer 
                or the most recent credit score of the consumer 
                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 of the key factors that adversely 
                affected the credit score of the consumer in 
                the model used, the total number of which shall 
                not exceed 4, subject to paragraph (9);
                  (D) the date on which the credit score was 
                created; and
                  (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 subsection, 
        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 such 
                        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 the financial 
                                assets of a consumer; 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 the general credit 
                behavior of a consumer 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) Fair and reasonable fee.--A consumer reporting 
        agency may charge a fair and reasonable fee, as 
        determined by the Bureau, for providing the information 
        required under this subsection.
          (9) Use of enquiries as a key factor.--If a key 
        factor that adversely affects the credit score of a 
        consumer 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.
  (g) 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 (f), in connection with an application 
        initiated or sought by a consumer for a closed end loan 
        or the 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 
                (f).--
                          (i) In general.--A copy of the 
                        information identified in subsection 
                        (f) 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 that is 
                        subject to this subsection 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'' has 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 
                that is subject to the provisions of this 
                subsection and that 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 
that 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--
                          (i) explain the information provided 
                        pursuant to subsection (f);
                          (ii) disclose any information other 
                        than a credit score or key factors, as 
                        defined in subsection (f);
                          (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; or
                          (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.--The obligation of 
                        any person 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.

           *       *       *       *       *       *       *


                             MINORITY VIEWS

    Committee Republicans view H.R. 3614, the Restricting 
Credit Checks for Employment Decisions Act, as a far-reaching 
approach that could yield unintended consequences and put 
consumers and investors at risk.
    H.R. 3614 prohibits the use of credit checks for all 
private and public companies in hiring decisions. The 
legislation allows an exception for credit checks in limited 
circumstances, including when authorized by federal, state, or 
local law or if the credit information is being used with 
respect to a national security investigation. In cases where 
consumer reports are permitted as a condition of employment, 
H.R. 3614 requires a potential employer to disclose to the 
consumer the reasons for obtaining a consumer report.
    Committee Republicans believe the exceptions included in 
H.R. 3614 are too limited and do not extend to positions where 
an employee's financial history may play a justifiable role in 
the hiring process. An individual's financial history is 
particularly important in the financial services industry, 
where employees may have access to vast amounts of personal and 
financial information for millions of American consumers. 
Credit checks can also provide information about whether there 
is potential for increased risk of fraud or illicit activity.
    Committee Republicans share the concern that credit history 
can negatively impact a candidate's chances of being selected 
for a job. In the majority of cases credit history alone should 
not alone disqualify an individual from employment. Republicans 
remain open to conversations on reform. However, such a 
sweeping approach is not the answer. Credit history can and 
should be a predictor of dependability and may be valuable in 
certain scenarios along with other factors needed to fulfill 
responsibilities. An outright prohibition of credit checks is 
irresponsible.

                                   David Kustoff.
                                   Tom Emmer.
                                   William R. Timmons IV.
                                   Ted Budd.
                                   Roger Williams.
                                   J. French Hill.
                                   John W. Rose.
                                   Anthony Gonzalez.
                                   Andy Barr.
                                   Lee M. Zeldin.
                                   Blaine Luetkemeyer.
                                   Bill Huizenga.
                                   Bill Posey.
                                   Barry Loudermilk.
                                   Lance Gooden.
                                   Scott R. Tipton.
                                   Peter T. King.
                                   Trey Hollingsworth.
                                   Bryan Steil.
                                   Warren Davidson.
                                   Denver Riggleman.
                                   Alexander X. Mooney.
                                   Frank D. Lucas.
                                   Ann Wagner.
                                   Steve Stivers.
                                   Patrick T. McHenry.

                                  [all]