[105th Congress Public Law 347]
[From the U.S. Government Printing Office]


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[DOCID: f:publ347.105]


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         CONSUMER REPORTING EMPLOYMENT CLARIFICATION ACT OF 1998

[[Page 112 STAT. 3208]]

Public Law 105-347
105th Congress

                                 An Act


 
 To amend the Fair Credit Reporting Act with respect to furnishing and 
   using consumer reports for employment <<NOTE: Nov. 2, 1998 -  [S. 
                            2561]>> purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress <<NOTE: Consumer Reporting 
Employment Clarification Act of 1998.>> assembled,

SECTION 1. SHORT <<NOTE: 15 USC 1601 note.>> TITLE.

    This Act may be cited as the ``Consumer Reporting Employment 
Clarification Act of 1998''.

SEC. 2. USE OF CONSUMER REPORTS FOR EMPLOYMENT PURPOSES.

    (a) Disclosure to Consumer.--Section 604(b)(2) of the Fair Credit 
Reporting Act (15 U.S.C. 1681b(b)(2)) is amended to read as follows:
            ``(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.

[[Page 112 STAT. 3209]]

                    ``(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.''.

    (b) Conditions on Use for Adverse Actions.--Section 604(b)(3) of the 
Fair Credit Reporting Act (15 U.S.C. 1681b(b)(3)) is amended to read as 
follows:
            ``(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 Federal Trade Commission 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

[[Page 112 STAT. 3210]]

                                    ``(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 Federal Trade Commission 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.''.

SEC. 3. PROVISION OF SUMMARY OF RIGHTS.

    Section 604(b)(1)(B) of the Fair Credit Reporting Act (15 U.S.C. 
1681b(b)(1)(B)) is amended by inserting ``, or has previously 
provided,'' before ``a summary''.
SEC. 4. NATIONAL SECURITY INVESTIGATION CONFORMING AMENDMENTS.

    (a) Government as End User.--Section 609(a)(3) of the Fair Credit 
Reporting Act (15 U.S.C. 1681g(a)(3)) is amended by adding at the end 
the following:
                    ``(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)); and
                          ``(ii) the head of the agency or department 
                      makes a written finding as prescribed under 
                      section 604(b)(4)(A).''.

    (b) National Security Investigations.--Section 613 of the Fair 
Credit Reporting Act (15 U.S.C. 1681k) is amended--
            (1) by inserting ``(a) In General.--'' before ``A 
        consumer''; and
            (2) by adding at the end the following:

    ``(b) Exemption for National Security Investigations.--Subsection 
(a) does not apply in the case of an agency or department of the United 
States Government that seeks to obtain and use a consumer report for 
employment purposes, if the head of the

[[Page 112 STAT. 3211]]

agency or department makes a written finding as prescribed under section 
604(b)(4)(A).''.

SEC. 5. CIVIL SUITS AND JUDGMENTS.

    Section 605(a) of the Fair Credit Reporting Act (15 U.S.C. 1681c(a)) 
is amended--
            (1) in paragraph (2), by striking ``Suits and Judgments 
        which'' and inserting ``Civil suits, civil judgments, and 
        records of arrest that'';
            (2) by striking paragraph (5);
            (3) in paragraph (6), by inserting ``, other than records of 
        convictions of crimes'' after ``of information''; and
            (4) by redesignating paragraph (6) as paragraph (5).

SEC. 6. TECHNICAL AMENDMENTS.

    The Fair Credit Reporting Act (15 U.S.C. 1601 et seq.) is amended--
            (1) in section 603(d)(2)(A)(iii), <<NOTE: 15 USC 1681a.>>  
        by striking ``any communication'' and inserting 
        ``communication'';
            (2) in section 603(o)(1), by striking ``(d)(2)(E)'' and 
        inserting ``(d)(2)(D)'';
            (3) in section 603(o)(4), by striking ``or'' at the end and 
        inserting ``and'';
            (4) in section 604(g), <<NOTE: 15 USC 1681b.>>  by striking 
        ``or a direct marketing transaction'';
            (5) in section 611(a)(7), <<NOTE: 15 USC 1681i.>>  by 
        striking ``(6)(B)(iv)'' and inserting ``(6)(B)(iii)''; and
            (6) in section 621(b), <<NOTE: 15 USC 1681s.>>  by striking 
        ``or (e)''.

SEC. 7. EFFECTIVE <<NOTE: 15 USC 1681a note.>> DATE.

    The amendments made by this Act shall be deemed to have the same 
effective date as the amendments made by section 2403 of the Consumer 
Credit Reporting Reform Act of 1996 (Public Law 104-208; 110 Stat. 3009-
1257).

    Approved November 2, 1998.

LEGISLATIVE HISTORY--S. 2561:
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CONGRESSIONAL RECORD, Vol. 144 (1998):
            Oct. 6, considered and passed Senate.
            Oct. 8, considered and passed House.

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