Interagency Advance Notice of Proposed Rulemaking: Procedures to Enhance the Accuracy and Integrity of Information Furnished to Consumer Reporting Agencies Under Section 312 of the Fair and Accurate Credit Transactions Act, 14419-14425 [06-2758]

Agencies

• FEDERAL DEPOSIT INSURANCE CORPORATION
• FEDERAL RESERVE SYSTEM
• FEDERAL TRADE COMMISSION
• National Credit Union Administration
• Office of the Comptroller of the Currency
• DEPARTMENT OF THE TREASURY
• Office of Thrift Supervision
• Comptroller of the Currency

[Federal Register Volume 71, Number 55 (Wednesday, March 22, 2006)]
[Proposed Rules]
[Pages 14419-14425]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-2758]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 71, No. 55 / Wednesday, March 22, 2006 / 
Proposed Rules

[[Page 14419]]



DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 41

[Docket No. 06-04]
RIN 1557-AC89

FEDERAL RESERVE SYSTEM

12 CFR Part 222

[Docket No. R-1250]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 334

RIN 3064-AC99

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Part 571

[No. 2006-06]
RIN 1550-AC01

NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 717

FEDERAL TRADE COMMISSION

16 CFR Parts 660 and 661

RIN 3084-AA94


Interagency Advance Notice of Proposed Rulemaking: Procedures to 
Enhance the Accuracy and Integrity of Information Furnished to Consumer 
Reporting Agencies Under Section 312 of the Fair and Accurate Credit 
Transactions Act

AGENCIES: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); Office of Thrift Supervision, 
Treasury (OTS); National Credit Union Administration (NCUA); and 
Federal Trade Commission (FTC).

ACTION: Advance notice of proposed rulemaking.

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SUMMARY: The OCC, Board, FDIC, OTS, NCUA, and FTC (the Agencies) 
request comment to gather information useful for developing the 
guidelines and regulations required by section 312 of the Fair and 
Accurate Credit Transactions Act (FACT Act). Pursuant to section 312, 
the Agencies, acting in consultation and coordination, must: Establish 
guidelines for use by persons that furnish information to consumer 
reporting agencies (furnishers) regarding the accuracy and integrity of 
the consumer information that they furnish to those agencies; and 
prescribe regulations that require furnishers to establish reasonable 
policies and procedures for implementing the guidelines. Section 312 
also requires the Agencies jointly to prescribe regulations that 
identify the circumstances under which a furnisher shall be required to 
reinvestigate a dispute concerning the accuracy of information 
contained in a consumer report on a consumer based on a direct request 
of the consumer.

DATES: Comments must be submitted by May 22, 2006.

ADDRESSES: Because paper mail in the Washington DC area and at the 
Agencies is subject to delay, please consider submitting your comments 
by e-mail. Commenters are encouraged to use the title ``Procedures to 
Enhance the Accuracy and Integrity of Information Furnished to Consumer 
Reporting Agencies'' to facilitate the organization and distribution of 
the comments. Comments submitted to one or more of the Agencies will be 
made available to all of the Agencies. Interested parties are invited 
to submit comments to:
    OCC: You should include OCC and Docket Number 06-04 in your 
comment. You may submit comments by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     OCC Web Site: https://www.occ.treas.gov. Click on ``Contact 
the OCC,'' scroll down and click on ``Comments on proposed 
regulations.''
     E-mail Address: regs.comments@occ.treas.gov.
     Fax: (202) 874-4448.
     Mail: Office of the Comptroller of the Currency, 250 E 
Street, SW., Mail Stop 1-5, Washington, DC 20219.
     Hand Delivery/Courier: 250 E Street, SW., Attn: Public 
Information Room, Mail Stop 1-5, Washington, DC 20219.
    Instructions: All submissions received must include the agency name 
(OCC) and docket number or Regulatory Information Number (RIN) for this 
rulemaking. In general, the OCC will enter all comments received into 
the docket without change, including any business or personal 
information that you provide. You may review comments and other related 
materials by any of the following methods:
     Viewing Comments Personally: You may personally inspect 
and photocopy comments at the OCC's Public Information Room, 250 E 
Street, SW., Washington, DC. You can make an appointment to inspect 
comments by calling (202) 874-5043.
     Viewing Comments Electronically: You may request e-mail or 
CD-ROM copies of comments that the OCC has received by contacting the 
OCC's Public Information Room at regs.comments@occ.treas.gov.
     Docket: You may also request available background 
documents and project summaries using the methods described above.
    Board: You may submit comments, identified by Docket No. R-1250, by 
any of the following methods:
     Agency Web site: https://www.federalreserve.gov. Follow the 
instructions for submitting comments at https://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm.
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: regs.comments@federalreserve.gov. Include docket 
number in the subject line of the message.
     FAX: (202) 452-3819 or (202) 452-3102.
     Mail: Jennifer J. Johnson, Secretary, Board of Governors 
of the Federal Reserve System, 20th Street and Constitution Avenue, 
NW., Washington, DC 20551.
    All public comments are available from the Board's Web site at 
https://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as 
submitted, except as necessary for technical

[[Page 14420]]

reasons. Accordingly, your comments will not be edited to remove any 
identifying or contact information. Public comments may also be viewed 
electronically or in paper in Room MP-500 of the Board's Martin 
Building (20th and C Streets, NW.) between 9 a.m. and 5 p.m. on 
weekdays.
    FDIC: You may submit comments, identified by RIN number by any of 
the following methods:
     Agency Web site: https://www.fdic.gov/regulations/laws/
federal/propose.html. Follow instructions for submitting comments on 
the Agency Web site.
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: Comments@FDIC.gov. Include the RIN number in the 
subject line of the message.
     Mail: Robert E. Feldman, Executive Secretary, Attention: 
Comments, Federal Deposit Insurance Corporation, 550 17th Street, NW., 
Washington, DC 20429.
     Hand Delivery/Courier: Guard station at the rear of the 
550 17th Street Building (located on F Street) on business days between 
7 a.m. and 5 p.m.
     Instructions: All submissions received must include the 
agency name and RIN for this rulemaking. All comments received will be 
posted without change to https://www.fdic.gov/regulations/laws/federal/
propose.html including any personal information provided. Comments may 
be inspected at the FDIC Public Information Center, Room E-1002, 3502 
North Fairfax Drive, Arlington, VA 22226, between 9 a.m. and 5 p.m. on 
business days.
    OTS: You may submit comments, identified by number 2006-06, by any 
of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail address: regs.comments@ots.treas.gov. Please 
include number 2006-06 in the subject line of the message and include 
your name and telephone number in the message.
     Fax: (202) 906-6518.
     Mail: Regulation Comments, Chief Counsel's Office, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552, 
Attention: No. 2006-06.
     Hand Delivery/Courier: Guard's Desk, East Lobby Entrance, 
1700 G Street, NW., from 9 a.m. to 4 p.m. on business days, Attention: 
Regulation Comments, Chief Counsel's Office, Attention: No. 2006-06.
    Instructions: All submissions received must include the agency name 
and docket number or Regulatory Information Number (RIN) for this 
rulemaking. All comments received will be posted without change to the 
OTS Internet site at https://www.ots.treas.gov/
pagehtml.cfm?catNumber=67&an=1, including any personal information 
provided.
    Docket: For access to the docket to read background documents or 
comments received, go to https://www.ots.treas.gov/
pagehtml.cfm?catNumber=67&an=1. In addition, you may inspect comments 
at the Public Reading Room, 1700 G Street, NW., by appointment. To make 
an appointment for access, call (202) 906-5922, send an e-mail to 
public.info@ots.treas.gov, or send a facsimile transmission to (202) 
906-7755. (Prior notice identifying the materials you will be 
requesting will assist us in serving you.) We schedule appointments on 
business days between 10 a.m. and 4 p.m. In most cases, appointments 
will be available the next business day following the date we receive a 
request.
    NCUA: You may submit comments by any of the following methods 
(please send comments by one method only):
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     NCUA Web Site: https://www.ncua.gov/
RegulationsOpinionsLaws/proposed_regs/proposed_regs.html. Follow the 
instructions for submitting comments.
     E-mail: Address to regcomments@ncua.gov. Include ``[Your 
name] Comments on Advanced Notice of Proposed Rulemaking Part 717, Fair 
Credit Reporting--Procedures to Enhance the Accuracy and Integrity of 
Information Furnished to Consumer Reporting Agencies'' in the e-mail 
subject line.
     Fax: (703) 518-6319. Use the subject line described above 
for e-mail.
     Mail: Address to Mary Rupp, Secretary of the Board, 
National Credit Union Administration, 1775 Duke Street, Alexandria, VA 
22314-3428.
     Hand Delivery/Courier: Address to Mary Rupp, Secretary of 
the Board, National Credit Union Administration. Deliver to guard 
station in the lobby of 1775 Duke Street, Alexandria, VA 22314-3428, on 
business days between 8 a.m. and 5 p.m.
    All public comments are available on the agency's Web site at 
https://www.ncua.gov/RegulationsOpinionsLaws/comments as submitted, 
except as may not be possible for technical reasons. Public comments 
will not be edited to remove any identifying or contact information. 
Paper copies of comments may be inspected in NCUA's law library, at 
1775 Duke Street, Alexandria, VA 22314, by appointment weekdays between 
9 a.m. and 3 p.m. To make an appointment, call (703) 518-6546 or send 
an e-mail to OGCMail@ncua.gov.
    FTC: Comments should refer to ``Procedures to Enhance the Accuracy 
and Integrity of Information Furnished to Consumer Reporting Agencies, 
Project No. R611017,'' and may be submitted by any of the following 
methods. Comments containing confidential material must be filed in 
paper form, must be clearly labeled ``Confidential,'' and must comply 
with Commission Rule 4.9(c).\1\
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See Commission Rule 4.9(c), 
16 CFR 4.9(c).
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     E-mail: https://secure.commentworks.com/ftc-
FACTAfurnishers. To ensure that the Commission considers an electronic 
comment, you must file it on the Web-based form found at this Web link 
and follow the instructions on that form.
     Federal eRulemaking Portal: https://www.regulations.gov. 
You may visit this Web site to read this request for public comment and 
to file an electronic comment. The Commission will consider all 
comments that regulations.gov forwards to it.
     Mail or Hand Delivery: A comment filed in paper form 
should refer, both in the text and on the envelope, to the name and 
project number identified above, and should be mailed or delivered to 
the following address: Federal Trade Commission/Office of the 
Secretary, Room 159-H (Annex C), 600 Pennsylvania Avenue, NW., 
Washington, DC 20580.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments, whether filed 
in paper or electronic form, will be considered by the Commission, and 
will be available to the public on the FTC Web site, to the extent 
practicable, at https://www.ftc.gov/os/publiccomments.htm. As a matter 
of discretion, the FTC makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC Web site. More information, including 
routine uses permitted by the

[[Page 14421]]

Privacy Act, may be found in the FTC's privacy policy, at https://
www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: OCC: Stephen Van Meter, Assistant 
Director, Community and Consumer Law Division, (202) 874-5750; Patrick 
T. Tierney, Senior Attorney, Legislative and Regulatory Activities 
Division, (202) 874-5090; or Pamela Mount, National Bank Examiner, 
Compliance Department, (202) 874-4428, Office of the Comptroller of the 
Currency, 250 E Street, SW., Washington, DC 20219.
    Board: David A. Stein, Counsel; Ky Tran-Trong, Senior Attorney, 
Division of Consumer and Community Affairs, (202) 452-3667 or (202) 
452-2412; or Andrew Miller, Counsel, Legal Division, (202) 452-3428, 
Board of Governors of the Federal Reserve System, 20th and C Streets, 
NW., Washington, DC 20551.
    FDIC: David P. Lafleur, Policy Analyst, (202) 898-6569, or John 
Jackwood, Senior Policy Analyst, (202) 898-3991, Division of 
Supervision and Consumer Protection; Richard M. Schwartz, Counsel, 
(202) 898-7424, or Richard B. Foley, Counsel, (202) 898-3784, Legal 
Division; 550 17th St., NW., Washington, DC 20429.
    OTS: Glenn S. Gimble, Senior Project Manager, Operation Risk, (202) 
906-7158; or Richard Bennett, Counsel, Regulations and Legislation 
Division, (202) 906-7409, at 1700 G Street, NW., Washington, DC 20552.
    NCUA: Regina Marie Metz, Esq., (703) 518-6561, fax (703) 837-2785, 
e-mail rmetz@ncua.gov, 1775 Duke St., Alexandria, VA 22314.
    FTC: Ronald G. Isaac, or Clarke W. Brinckerhoff, Attorneys, (202) 
326-3224, Bureau of Consumer Protection, Federal Trade Commission, 600 
Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

I. Background

Consumer Reporting in the United States

    The consumer reporting system in the United States is based largely 
on the submission of information by creditors and others to nationwide 
consumer reporting agencies that collect and maintain consumer 
information. There are also a number of smaller consumer reporting 
agencies that operate on a regional or local basis. These smaller 
agencies typically contract for the right to house some or all of the 
consumer data that they own on the computer systems of one or more of 
the major consumer reporting agencies. Consumer reporting agencies sell 
the information in their files to creditors and other subscribers who 
may be the users of the information, or who may be resellers that buy 
consumer reports to sell to other users.
    Consumer reporting agencies maintain databases that contain 
detailed information about consumers' transactions. This information is 
widely used to determine consumers' eligibility for credit, employment, 
insurance, rental housing, and other products and services, as well as 
the terms on which credit, insurance, and other products and services 
may be offered. In addition to these general purpose consumer reporting 
agencies, there are consumer reporting agencies that collect and 
maintain data pertaining only to certain specialized activities, such 
as employment history, residential or tenant history, medical records 
or payments, check writing histories, or insurance claims.
    Most of the information that consumer reporting agencies collect 
and maintain is provided voluntarily by furnishers. Furnishers may 
include such entities as banks, credit unions, finance companies, 
employers, insurance companies, doctors and hospitals, debt collectors, 
and landlords. Not all furnishers regularly provide information about 
consumers to consumer reporting agencies. Some furnishers provide only 
negative information, such as information about delinquent payments or 
loan defaults. Some may provide information to one or two of the 
nationwide consumer reporting agencies but not to all of them. Others 
may report only to one of the specialized consumer reporting agencies 
(such as a repository of check writing histories).
    Because consumer reports are used to determine whether, and in some 
cases on what terms, consumers may be eligible for credit, insurance, 
employment, rental housing, and other important products, services, or 
benefits, the accuracy of the information in those reports is 
important. A number of studies have examined the accuracy of consumer 
report information.\2\ While not purporting to be exhaustive or 
conclusive, these studies have identified a number of potential issues 
that may affect the accuracy of consumer report information, including 
stale account information, furnishing only negative information about 
an account, inaccurate or incomplete public record data, inaccurate or 
incomplete collection account data, and unreported credit limits.\3\ 
These potential credit file issues may lower a consumer's credit score, 
decrease credit availability, and increase the cost of credit for 
certain consumers, particularly those who are new to the credit system, 
have very little credit, or have relatively low credit scores.
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    \2\ The Agencies are familiar with the details of these studies 
and, as discussed below, invite commenters to provide information in 
addition to the studies regarding the accuracy and integrity of 
consumer report information. See Robert B. Avery, Raphael W. Bostic, 
Paul S. Calem & Glenn B. Canner, An Overview of Consumer Data and 
Credit Reporting, Federal Reserve Bulletin, vol. 89, at 47-73 
(February 2003); Robert B. Avery, Paul S. Calem, Glenn B. Canner & 
Shannon C. Mok, Credit Report Accuracy and Access to Credit, Federal 
Reserve Bulletin, vol. 90, at 297-322 (Summer 2004); Consumer 
Federation of America & National Credit Reporting Association, 
Credit Score Accuracy and Implications for Consumers (December 17, 
2002), at https://www.consumerfed.org/pdfs/121702CFA_NCRA_Credit_
Score_Report_Final.pdf (last visited February 13, 2006). See also 
footnote 11 in this notice describing the FTC's ongoing study of the 
accuracy and completeness of information contained in consumer 
reports prepared or maintained by consumer reporting agencies and 
the methods for improving the accuracy and completeness of such 
information and its first interim report to Congress. In addition, 
the Board issued a Request for Information in August 2004 in 
connection with a study on investigations of disputed consumer 
information reported to consumer reporting agencies. 69 FR 48494 
(August 10, 2004). The Agencies have considered the responses to the 
Request for Information in developing this advance notice of 
proposed rulemaking.
    \3\ Id.
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Existing FCRA Responsibilities of Furnishers

    The Fair Credit Reporting Act (FCRA) \4\ contains a number of 
provisions designed to enhance the accuracy and integrity of data in 
consumer reports, including the provisions to be implemented through 
the guidelines and regulations that are the subject of this Advance 
Notice of Proposed Rulemaking.
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    \4\ 15 U.S.C. 1681-1681x.
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    The FCRA contains standards for the collection, communication, and 
use of information bearing on a consumer's credit worthiness, credit 
standing, credit capacity, character, general reputation, personal 
characteristics, or mode of living. Section 623 of the FCRA describes 
the responsibilities of persons that furnish information to consumer 
reporting agencies.\5\ A person is prohibited from furnishing 
information relating to a consumer to any consumer reporting agency if 
the person knows or has reasonable cause to believe that the 
information is inaccurate.\6\ Section 623

[[Page 14422]]

also requires furnishers, among other things, to correct and update 
information furnished about a consumer to any consumer reporting agency 
in certain circumstances, to provide consumer reporting agencies with 
notice of certain consumer disputes and of accounts closed voluntarily 
by consumers, to provide credit reporting agencies with information 
regarding certain delinquent accounts, and to have in place reasonable 
procedures to prevent the refurnishing of information that has been 
blocked as a result of identity theft.\7\
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    \5\ 15 U.S.C. 1681s-2.
    \6\ 15 U.S.C. 1681s-2(a)(1). A furnisher that clearly and 
conspicuously provides consumers with an address for submitting 
notices of dispute is subject to a different accuracy standard. If a 
consumer writes to that address to challenge the accuracy of any 
furnished information, and the information is, in fact, inaccurate, 
the furnisher must report only the correct information to consumer 
reporting agencies in the future.
    \7\ 15 U.S.C. 1681s-2(a)(2)-(6).
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    A furnisher that is notified by a consumer reporting agency that 
information it furnished has been disputed by a consumer pursuant to 
section 611 \8\ of the FCRA must:
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    \8\ Section 611 of the FCRA generally permits a consumer to 
dispute the completeness or accuracy of any item in the consumer's 
credit file directly with a consumer reporting agency. Within five 
business days after the consumer reporting agency receives a notice 
of dispute from a consumer, the consumer reporting agency is 
required to provide notification of the dispute to any person who 
provided any item of disputed information. This notification of 
dispute must include all relevant information received from the 
consumer. Consumer reporting agencies must, free of charge, conduct 
a reasonable reinvestigation to determine whether the disputed 
information is inaccurate and record the current status of the 
disputed information, or delete the item from the consumer's credit 
file before the end of the 30-day period beginning on the date that 
the consumer reporting agency receives the notice of dispute from 
the consumer. 15 U.S.C. 1681i.
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     Investigate the dispute;
     Review all relevant information provided by the consumer 
reporting agency about the dispute;
     Report its findings to the consumer reporting agency;
     Provide corrected information to all nationwide consumer 
reporting agencies that received the information, if the investigation 
shows the information to be incomplete or inaccurate; and
     Promptly modify, delete, or permanently block the 
reporting to a consumer reporting agency of an item of information 
disputed by a consumer that is found to be inaccurate, incomplete, or 
cannot be verified after an investigation.\9\
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    \9\ 15 U.S.C. 1681s-2(b). The furnisher must complete these 
steps within the time period that Section 611 of the FCRA sets out 
for the consumer reporting agency to resolve the dispute, which is, 
ordinarily, 30 days after receipt of a notice of dispute from the 
consumer.
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FACT Act Provisions To Be Implemented Through This Rulemaking

    The FACT Act, enacted on December 4, 2003,\10\ amended the FCRA to 
enhance the ability of consumers to combat identity theft, increase the 
accuracy of consumer reports, restrict the use of medical information 
in credit eligibility determinations, and allow consumers to exercise 
greater control regarding the type and amount of solicitations they 
receive.
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    \10\ Public Law No. 108-159, 117 Stat. 1952.
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    Section 312 of the FACT Act amends section 623 of the FCRA and 
generally requires the Agencies to issue guidelines for use by 
furnishers regarding the accuracy and integrity of the information that 
they furnish to consumer reporting agencies and prescribe regulations 
requiring furnishers to establish reasonable policies and procedures 
for implementing the guidelines. Section 312 also requires the Agencies 
to issue regulations identifying the circumstances under which a 
furnisher must reinvestigate disputes about the accuracy of information 
contained in consumer reports based on a direct request from a 
consumer.

Guidelines and Regulations Concerning the Accuracy and Integrity of 
Information That Furnishers Provide to Consumer Reporting Agencies

    Section 312(a) of the FACT Act adds a new subsection (e) to section 
623 of the FCRA. Section 623(e)(1)(A) of the FCRA requires the Agencies 
to establish and maintain guidelines for use by each furnisher 
regarding the accuracy and integrity of the consumer information that 
the furnisher provides to consumer reporting agencies.\11\ The Agencies 
are required to update these guidelines as often as necessary. Section 
623(e)(1)(B) of the FCRA requires each Agency to prescribe regulations 
requiring furnishers to establish reasonable policies and procedures 
for implementing the guidelines established pursuant to section 
623(e)(1)(A). The Agencies must consult and coordinate with one another 
so that, to the extent possible, the regulations published by each 
Agency are consistent and comparable.
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    \11\ The FACT Act also directs the FTC to ``conduct an ongoing 
study of the accuracy and completeness of information contained in 
consumer reports prepared or maintained by consumer reporting 
agencies and methods for improving the accuracy and completeness of 
such information.'' See section 319 of the FACT Act. The FTC 
submitted its first interim report to Congress on this study on 
December 9, 2004; available at https://www.ftc.gov/reports/facta/
041209factarpt.pdf (last visited February 13, 2006).
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    Section 623(e)(3) of the FCRA sets forth criteria to be used by the 
Agencies in developing the accuracy and integrity guidelines. This 
provision directs the Agencies to:
     Identify patterns, practices, and specific forms of 
activity that can compromise the accuracy and integrity of information 
furnished to consumer reporting agencies;
     Review the methods (including technological means) used to 
furnish consumer information to consumer reporting agencies;
     Determine whether furnishers maintain and enforce policies 
to assure the accuracy and integrity of information furnished to 
consumer reporting agencies; and
     Examine the policies and processes employed by furnishers 
to conduct reinvestigations and correct inaccurate consumer information 
that has been furnished to consumer reporting agencies.

Regulations Concerning the Ability of a Consumer to Dispute Information 
Directly With a Furnisher

    Section 312(c) of the FACT Act adds a new sub-paragraph (8) to 
section 623(a) of the FCRA. Section 623(a)(8) directs the Agencies 
jointly to prescribe regulations that identify the circumstances under 
which a furnisher is required to reinvestigate a dispute concerning the 
accuracy of information contained in a consumer report on the consumer, 
based on a direct request by the consumer. In prescribing these 
regulations, the Agencies are directed to weigh:
     The regulations' benefits to consumers with the costs on 
furnishers and the credit reporting system;
     The impact on the overall accuracy and integrity of 
consumer reports of any such requirements;
     Whether direct contact by the consumer with the furnisher 
would likely result in the most expeditious resolution of any dispute; 
and
     The potential impact on the credit reporting process if 
credit repair organizations are able to circumvent the provisions in 
subparagraph G of section 623(a)(8), which state that the direct 
dispute rules shall not apply when credit repair organizations provide 
notices of dispute on behalf of consumers.

II. Request for Comments

    The Agencies believe that, in advance of proposing guidelines and 
rules implementing section 312 of the FACT Act, it is appropriate to 
solicit public comment on issues relating to: (1) The criteria in 
section 623(e)(3) of the FCRA that the Agencies must consider when 
developing accuracy and integrity guidelines; (2) what constitutes 
reasonable policies and procedures for implementing the guidelines to 
ensure the accuracy and integrity of information that is furnished; and 
(3) the considerations in section

[[Page 14423]]

623(a)(8)(B) that the Agencies must weigh when promulgating rules that 
identify circumstances when furnishers must reinvestigate disputes 
raised directly by consumers.
    In particular, the Agencies invite comment, together with 
supporting documentation, on any or all of the issues presented below. 
Because these guidelines and regulations could affect any and all 
persons furnishing information to consumer reporting agencies, 
regardless of the type of furnisher or consumer reporting agency, the 
frequency of reporting, or the type of information being provided, we 
request that commenters explain, to the extent possible, how their 
comments might differ depending on the type of furnisher providing the 
information, the type of information being provided, the frequency of 
the reporting, or the type of consumer reporting agency to which the 
information is provided.

(A) Accuracy and Integrity Guidelines and Regulations

    A1. Please describe, in detail, the types of errors, omissions, or 
other problems that may impair the accuracy and integrity of 
information furnished to consumer reporting agencies. Please specify 
whether any such problems result in credit file information that (1) is 
incorrect, including inaccurate account information, public record 
data, or collection account data; (2) is out of date or includes stale 
account information; (3) is associated with the wrong consumer; (4) 
omits potentially significant information about the consumer account or 
transaction, such as credit limits for or positive information about 
the account; (5) is duplicative; (6) may mislead users of consumer 
reports; or (7) otherwise adversely affects consumers, particular types 
of consumers, or the credit reporting system. Finally, please describe 
the significance of such problems for consumers, particular groups of 
consumers (e.g., borrowers with poor or limited credit histories), 
users of consumer reports, and the credit reporting system.
    A2. Please describe, in detail, the patterns, practices, and 
specific forms of activity that can compromise the accuracy and 
integrity of information furnished to consumer reporting agencies. 
Relevant patterns, practices, and specific forms of activity may relate 
to any aspect of the information gathering and reporting process, such 
as the methods by which furnished information is collected, verified, 
edited, standardized, and transferred. They may be of general 
applicability or relate to specific types of furnishers, such as 
financial institutions, creditors, or collection agencies, or specific 
types of consumer reporting agencies, such as credit bureaus or tenant 
screening services. Examples of patterns, practices, and specific forms 
of activity that may cause these problems include, but are not limited 
to, the sale of consumer debts to and among collection agencies, the 
conversion or translation of furnished information into a standard 
form, and the frequency, timing, categories, and content of information 
that is furnished to consumer reporting agencies.
    A3. Please describe, in detail, any business, economic, or other 
reasons for the patterns, practices, and specific forms of activity 
described in item A2.
    A4. Please describe, in detail, the policies and procedures that a 
furnisher should implement and maintain to identify, prevent, or 
mitigate those patterns, practices, and specific forms of activity that 
can compromise the accuracy and integrity of information furnished to a 
consumer reporting agency.
    A5. Please describe, in detail, the methods (including 
technological means) used to furnish consumer information to consumer 
reporting agencies. Please describe, in detail, how the use of these 
methods can either enhance or compromise the accuracy and integrity of 
consumer information that is furnished to consumer reporting agencies.
    A6. Please describe, in detail, whether and to what extent 
furnishers maintain and enforce policies and procedures to ensure the 
accuracy and integrity of information furnished to consumer reporting 
agencies, including a description of any policies and procedures that 
are maintained and enforced, such as policies and procedures relating 
to data controls, points of failure, account termination, the re-
reporting of deleted consumer information, the reporting of the 
deferral or suspension of payment obligations in unusual circumstances, 
such as natural disasters, or the frequency, timing, categories, and 
content of information furnished to consumer reporting agencies. Please 
assess the effectiveness of these policies and procedures and provide 
suggestions on how their effectiveness might be improved or enhanced. 
Please describe whether particular policies or procedures are 
especially necessary or relevant to particular methods of furnishing 
information. Please also describe how such policies and procedures are 
monitored and evaluated to ensure their effectiveness.
    A7. Please describe, in detail, any methods (including any 
technological means) that a furnisher should use to ensure the accuracy 
and integrity of consumer information furnished to a consumer reporting 
agency.
    A8. Please describe, in detail, the policies, procedures, and 
processes used by furnishers to conduct reinvestigations and to correct 
inaccurate consumer information that has been furnished to consumer 
reporting agencies. Please include a description of the policies and 
procedures that furnishers use to comply with the requirement that they 
``review all relevant information provided by the consumer reporting 
agency'' as stated in section 623(b)(1)(B) of the FCRA.
    A9. Please describe, in detail, the policies, processes, and 
procedures that furnishers should use to conduct reinvestigations and 
to correct inaccurate consumer information that has been furnished to 
consumer reporting agencies.
    A10. Please describe, in detail, the policies and procedures of 
consumer reporting agencies for ensuring the accuracy and integrity of 
information received from furnishers, including any policies, 
procedures, or other requirements imposed on furnishers (by contract or 
otherwise) to ensure the accuracy and integrity of information 
furnished to consumer reporting agencies. Please describe specifically 
whether and to what extent those policies, procedures, or other 
requirements address particular problems that may affect information 
accuracy and integrity such as the accuracy of consumer address and 
other identifying information, updating records to link the correct 
consumer(s) to account information, the impact of different reporting 
formats, and duplicate reporting by collection agencies. Please also 
describe whether particular policies or procedures are especially 
necessary or relevant to particular types of furnishers.

(B) Direct Dispute Regulations

    B1. Please identify the circumstances under which a furnisher 
should (or alternatively, should not) be required to investigate a 
dispute concerning the accuracy of information furnished to a consumer 
reporting agency based upon a direct request from the consumer, and 
explain why.
    B2. Please describe any benefits or costs to consumers from having 
the right to dispute information directly with the furnisher, rather 
than through a consumer reporting agency, in some or all circumstances. 
Please address the

[[Page 14424]]

circumstances under which direct disputes with furnishers would yield 
more, fewer, or the same benefits or costs for consumers as disputes 
that are first received and processed through the consumer reporting 
agencies and then routed to furnishers for investigation. Please 
quantify any benefits or costs, if possible.
    B3. Please describe any benefits to furnishers, consumer reporting 
agencies, or the credit reporting system that may result if furnishers 
were required to investigate disputes based on direct requests from 
consumers in some or all circumstances. Please quantify any benefits, 
if possible.
    B4. Please describe any costs, including start-up costs, to 
furnishers and any costs to consumer reporting agencies or the credit 
reporting system, of requiring a furnisher to investigate a dispute 
based on a direct request by a consumer in some or all circumstances. 
Please address the circumstances under which direct disputes with 
furnishers would cost more, less, or the same to process, excluding 
start-up costs, as compared to disputes that are first received and 
processed through the consumer reporting agencies and then routed to 
furnishers for investigation. Please quantify any costs, if possible. 
To the extent applicable, please discuss the percentage of disputes 
processed through consumer reporting agencies that (1) involve an error 
by the consumer reporting agency (rather than a problem with the 
information provided by the furnisher), (2) are determined to be 
frivolous or irrelevant, or (3) result in changes to consumer credit 
files. Does the FCRA's section 623(a)(8)(F)(ii) timing requirement for 
a Notice of Determination that a consumer dispute is frivolous or 
irrelevant impose additional costs? If so, please provide quantitative 
data about such costs.
    B5. Please discuss whether it is the current practice of furnishers 
to investigate disputes about the accuracy of information furnished to 
a consumer reporting agency based on direct requests by consumers. For 
those furnishers that currently investigate such direct disputes, 
please identify and discuss the following:
    B5(a).The circumstances under which the furnisher will and will not 
investigate such a direct dispute;
    B5(b).The furnisher's experience with receiving and identifying 
direct disputes submitted by credit repair organizations;
    B5(c).The differences between the furnisher's existing procedures 
for resolving direct disputes (including time frames and communications 
with the consumer) and the procedures set forth in section 623(a)(8) of 
the FCRA, and the costs and other implications of modifying those 
procedures to conform to section 623(a)(8);
    B5(d).Whether the percentage of direct disputes for a portfolio of 
accounts varies for different lines of business (e.g., mortgage, auto 
lending, unsecured credit);
    B5(e). Whether the costs of resolving direct disputes varies for 
different lines of business; and
    B5(f).The percentage of disputes received directly from consumers 
and from the consumer reporting agencies, the percentage of duplicate 
disputes that are received both directly from consumers and the 
consumer reporting agencies, and any practices designed to detect and 
process such duplicate disputes.
    B6. Please describe the impact on the overall accuracy and 
integrity of consumer reports if furnishers were required, under some 
or all circumstances, to investigate disputes concerning the accuracy 
of information furnished to consumer reporting agencies based on the 
direct request of a consumer.
    B7. Please describe the circumstances in which direct contact by 
the consumer with the furnisher would likely result, or alternatively, 
would likely not result, in the most expeditious resolution of any 
dispute concerning the accuracy of information furnished to a consumer 
reporting agency.
    B8. Section 623(a)(8)(G) of the FCRA provides that any direct 
dispute requirement would not apply to any notice of dispute submitted 
by, prepared on behalf of the consumer by, or submitted on a form 
supplied by, a credit repair organization. In prescribing the 
regulations mandated under section 623(a)(8), section 623(a)(8)(b)(iv) 
requires the Agencies to weigh the ``potential impact on the credit 
reporting process if credit repair organizations * * * are able to 
circumvent the prohibition in subparagraph (G) of that section.'' 
Please describe the potential impact on the credit reporting process if 
a person that meets the definition of a credit repair organization is 
able to circumvent section 623(a)(8)(G).

Small Institution Comment Request

    The Agencies invite comment on the impact on small institutions of 
procedures that would enhance the accuracy and integrity of information 
furnished to consumer reporting agencies. The Agencies recognize that 
small institutions operate with more limited resources than larger 
institutions and may present a different risk profile. Thus, the 
Agencies specifically request comment on the impact of a future 
proposal on small institutions' current resources and available 
personnel with the requisite expertise, and whether the goals of any 
proposal could be achieved, for small institutions, through an 
alternative approach.

Request for Comment From Furnishers Other Than Depository Institutions 
and From Consumer Reporting Agencies Other Than Credit Bureaus

    The Agencies invite comments from businesses other than depository 
institutions that furnish information to credit bureaus. These may 
include certain mortgage lenders, debt collectors, consumer finance 
companies, and retailers. The Agencies also invite comments from 
persons who furnish information to other types of consumer reporting 
agencies, such as consumer reporting agencies that collect information 
for the purpose of making decisions regarding insurance, employment or 
tenant screening, or check verification. Similarly, the Agencies 
request comments from consumer reporting agencies, including 
nontraditional consumer reporting agencies that may only provide 
information to a limited class of businesses (e.g., medical information 
providers and tenant screening services).

Request for Comment From Individuals and Public Interest and Consumer 
Advocacy Organizations

    The Agencies invite comments from individuals and public interest 
and consumer advocacy organizations on the effect that any procedures 
to enhance the accuracy and integrity of information furnished to 
consumer reporting agencies may have on consumers and the credit 
reporting industry.

Economic Growth and Regulatory Paperwork Reduction Act of 1996 Comment 
Request

    Section 2222 of the Economic Growth and Regulatory Paperwork 
Reduction Act of 1996 (EGRPRA) requires the Federal banking agencies 
and NCUA, not less frequently than once every 10 years, to identify 
outdated or otherwise unnecessary regulatory requirements imposed on 
insured depository institutions. Consistent with the goal of section 
2222 of the EGRPRA, the Federal banking agencies and NCUA invite 
comment on how they might best achieve the goals of section 312 while 
minimizing any possible regulatory burden on furnishers. Specifically, 
the Federal banking agencies and NCUA

[[Page 14425]]

request comment on how to apply the criteria they must consider when 
developing the accuracy and integrity guidelines (see section 623(e)(3) 
of the FCRA) so as not to create unnecessary or unduly burdensome 
requirements. Also, the Federal banking agencies and NCUA request 
comment on how to weigh the considerations relating to when furnishers 
must reinvestigate disputes raised directly by consumers (see section 
623(a)(8)(B) of the FCRA) so as not to create unnecessary or unduly 
burdensome requirements for furnishers.

Executive Order 12866

    OCC and OTS: The OCC and OTS do not know whether the guidelines and 
regulations they will propose will constitute a significant regulatory 
action under the Executive Order 12866. Executive Order 12866 requires 
preparation of an analysis for agency actions that are ``significant 
regulatory actions.'' ``Significant regulatory actions'' are actions 
that may result in regulations that are likely to:
     Have an annual effect on the economy of $100 million or 
more or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities;
     Create a serious inconsistency or otherwise interfere with 
an action taken or planned by another agency;
     Materially alter the budgetary impact of entitlements, 
grants, user fees, or loan programs or the rights and obligations of 
recipients thereof; or
     Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.\12\
    This ANPR neither establishes nor proposes any regulatory 
requirements. Because this ANPR does not contain a specific proposal, 
information is not available with which to prepare a regulatory 
analysis. The OCC and OTS will each prepare a regulatory analysis if 
they proceed with a proposed rule that constitutes a significant 
regulatory action.
    Accordingly, the OCC and OTS solicit comment, information, and data 
on the potential effects on the economy of any guidelines and 
regulations that commenters may recommend. The OCC and OTS encourage 
commenters to provide information about estimates of costs, benefits, 
other effects, or any other information, particularly costs to 
implement the statutory requirements if institutions are already 
meeting any of those requirements (e.g., documenting policies and 
procedures, monitoring, and training). In addition, the OCC and OTS ask 
commenters to identify or estimate start-up or non-recurring costs 
separately from costs or effects they believe would be ongoing. Also, 
the OCC and OTS ask commenters to provide data on the total number of 
consumer disputes reported annually and the per-unit cost to resolve 
each dispute. Quantitative information would be the most useful. The 
OCC and OTS will carefully consider the costs and benefits associated 
with this regulatory action.
---------------------------------------------------------------------------

    \12\ Executive Order 12866 (September 30, 1993), 58 FR 51735 
(October 4, 1993), as amended by Executive Order 13258 (February 26, 
2002), 67 FR 9385 (February 28, 2002). A ``regulatory action'' is 
``any substantive action by an agency (normally published in the 
Federal Register) that promulgates or is expected to lead to the 
promulgation of a final rule or regulation, including notices of 
inquiry, advance notices of proposed rulemaking, and notices of 
proposed rulemaking.'' Executive Order 12866, section 3(e).

    Dated: March 15, 2006.
John C. Dugan,
Comptroller of the Currency.
    By order of the Board of Governors of the Federal Reserve 
System, March 13, 2006.
Jennifer J. Johnson,
Secretary of the Board.
    By order of the Board of Directors.

    Dated at Washington, DC, the 10th day of February, 2006. Federal 
Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
    Dated: February 6, 2006.

    By the Office of Thrift Supervision.
John M. Reich,
Director.
    By the National Credit Union Administration Board on March 13, 
2006.
Mary Rupp,
Secretary of the Board.
    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 06-2758 Filed 3-21-06; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-10-P; 6720-01-P; 7535-01-P; 
6750-01-P