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Wednesday, June 10, 2009

15 U.S.C. 1681b - part 4

Lets continue with the explanation of 15 U.S.C. 1681b with subsection (e).

"(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."

[This is the section that gives consumers the right to opt out of promotional lists distributed by the consumer reporting agencies. If you want to stop getting so much junk mail, you should do this. But this will also eliminate the majority of "preapproved" credit card offers that you receive.]

"(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."

[The FCRA gives you two ways to notify the consumer reporting agency that you want to be left off promotional lists that they sell. One is through the national notification system required by subparagraph (5). The other is by using a written notice of election form that the CRAs can provide.]

"(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."

[After a consumer tells the consumer reporting agency that he or she is opting out of the preapproved/promotional lists, the consumer reporting agency must tell the consumer that his or her opt out status is only effective for 5 years and must provide the notice of election form mentioned in 15 U.S.C 1681b(e)(2)(B) if it is requested by the consumer.]

"(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."

[This subsection just explains when the opt out period begins, which is typically 5 days after notification and is good for either 5 years or until the consumer changes his or her mind and notifies the consumer reporting agency that they want back on the lists.]

"(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 notifiy 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 address 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)."

[This just means that a consumer reporting agency must have a toll free phone number for consumers to call to opt out and that they must publicize at least once a year the fact that they use consumer reports may be used to generate promotional lists and the address and toll free number that consumers can use to opt out.]

"(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."

[This means that a consumer reporting agency that utilizes affiliate companies (i.e. small, regional CRAs) can use one notification system that allows the primary CRA and all affiliates to comply with this subsection.]

"(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."

[Subsection (6) means that the big three CRAs (Experian, Equifax and Trans Union) must have a joint notification system, which means that a consumer only has to notify one CRA to be opted out of all three's promotional lists.]

I will finish the explanation of 15 U.S.C. 1681b in part 5.

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