Ftc And Fair Credit Reporting

The Federal Trade Commission (FTC) is the agency of the U.S. government that enforces the 1971 Fair Credit Reporting Act and the 1996 and 2003 laws that strengthened consumers' rights to be treated fairly by credit card companies and credit bureaus. The FTC encourages consumers to report alleged violations of the three fair credit reporting laws to its offices in Washington, D.C.

Informing Consumers

The FTC publishes several brochures on the rights that consumers have under the three fair credit reporting laws. In its "A Summary of Your Rights Under the Fair Credit Reporting Act" publication, the FTC lists 11 consumer rights. They include the right to be informed if information in a credit bureau file has been used to deny credit or employment, the right to know what is in credit bureau files, and the right to learn credit bureaus' credit scores. The law also requires credit bureaus to remove inaccurate information from their files.

Free Reports

The 2003 fair credit reporting law, which is formally called the Fair and Accurate Transactions (FACT) Act, gave consumers the right to obtain three free credit reports every year--one each from the Equifax, Experian and TransUnion credit bureaus.

According to the FTC, the Annual Credit Report website is the only website that is authorized to distribute the free credit reports and it "will not send you an email asking for your personal information." The FTC reports that there are "scam" businesses offering consumers free reports and urges people to forward these e-mails to the FTC at spam@uce.gov.

Identity Theft

According to the FTC, the 2003 fair credit reporting law also gave consumers the right to place a "fraud alert" in their credit bureau files. These fraud alerts are a way of combating identity theft because they "can make it more difficult for someone to get credit in your name."

The FTC urges consumers to report suspected identity theft as well as Internet and telemarketing fraud complaints to (877) FTC-HELP, a toll-free number. The complaints are logged into the Consumer Sentinel Network, a database used by law enforcement agencies throughout the United States.

Disputing Information

The original fair credit reporting law pertained to credit bureaus, but not the companies providing the information to the bureaus. The 1996 law, though, gave consumers the right to dispute information in credit bureau files directly with the companies.

According to the Consumers Union, the FTC has the power to determine how vigorously the companies should investigate consumer complaints. The law also gives consumers the right to have their explanation of the dispute inserted into credit bureaus' files even if the creditor won't reverse the charges.

FTC's Function

The FTC became an advocate for consumers during the 1960s, according to "Guide to Personal Finance" A Lifetime Program of Money Management." However, the FTC emphasizes in its literature that it "can't act as your lawyer in private disputes."

The FTC advises consumers with complaints about violations of fair credit reporting laws to contact Consumer Response Center--FCRA, Federal Trade Commission, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580. Consumers can learn more about their rights at the FTC website.