PBSA Journal
PAGE 5
JULY/AUG 2021
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by PBSA 2021. All rights reserved.
FCRA Reform: House Democrats Consider Bill to Reform the
Fair Credit Reporting Act, Including a New Bill That Would
Establish a Federal Consumer Reporting Agency Continued from page 4
side calling to eliminate risk-based pricing and financial
services." He added that "risk-based pricing in credit
allocation, insurance, and other financial products is
essential to ensuring that consumers are paying the
appropriate price for their products, firms are adequately
managing risk, and allocation of credit is not arbitrarily
limited based on onerous, one size fits all restrictions."
In addressing disparities in access to credit, Committee
Republicans have focused on the increased usage of
alternative data, such as cell phone, rent, and other utility
payments towards fostering increased financial inclusion.
In the most recent hearing, the Committee discussed
three pieces of legislation: the Comprehensive Consumer
Credit Reporting Reform Act, the Protecting Your Credit
Score Act of 2021, and the National Credit Reporting
Agency Act.
The Comprehensive Consumer Credit Reporting Reform
Act, H.R. 4120 (previously entitled the Comprehensive
CREDIT Act of 2020, H.R. 3621) as reintroduced by Rep.
Ayanna Pressley (D-MA-7) sets forth several sweeping
changes to the FCRA including: a new appeals process,
a new statutory standard of standard of accuracy and
completeness and injunctive relief. Additionally, the
legislation institutes a prohibition on the use of credit
checks in "most" employment decisions. It also outlines
the "requirements for consumer reports bearing on the
consumer's creditworthiness, credit standing, and/or credit
capacity" as it relates to employment decisions. Additionally,
the bill draft prohibits the inclusion of arrest information
on a report if there is no conviction. On January 29, 2020,
the Comprehensive CREDIT Act of 2020 passed the House
by a vote of 221-189.
The second bill discussed during the June 29 hearing
was The Protecting Your Credit Score Act of 2021, as
reintroduced by Rep. Josh Gottheimer (D-NJ-5). The bill
would provide consumers with the ability to seek injunctive
relief, and would establish accuracy, dispute process,
and transparency standards, as well as a CRA registry.
The measure would also require CRAs to conduct audits
on a schedule to be determined by the CFPB to check
for accuracy of consumer reports. On June 29, 2020,
the Protecting Your Credit Score Act of 2020 (H.R. 5332)
passed the House by a vote of 234-179.
The National Credit Reporting Agency Act would
establish a Public Credit Registry ("PCR") within the
CFPB. This registry would act as a "federal consumer
reporting agency and provide consumer reports/credit
scores." Under the draft legislation, a consumer may
opt-in to using the PCR exclusively making it unlawful
for anyone to request a consumer report (or credit score)
from any consumer reporting agency other than the PCR.
Additionally, the bill requires any furnisher that provides
information to a CRA to also furnish such information to the
public credit registry and any furnishers who consistently
inaccurate or incomplete information to the PCR would
be subject to civil fines of $1,000 per violation.
Moving forward, if this legislation makes it to markup,
we can expect the Comprehensive Consumer Credit
Reporting Reform Act and Protecting Your Credit Score
Act of 2021 to pass in Committee and eventually in the
House as they did during the last Congress. However, they
were not taken up in the Senate during the 116th Congress.
Should these two bills make it to the Senate, we still expect
them to face an uphill battle even with a democratic majority.
As for the National Credit Reporting Agency Act, the Biden
Administration and most committee Democrats have
endorsed the PCR. However, during the most recent hearing
Rep. Brad Sherman (D-CA-30) stated that he was "a bit
concerned about a federal credit reporting agency." While
the future of the PCR is less clear than the other two
bills, given the lack of history accompanied with the drastic
changes it would impose on the current system, we can also
expect this legislation to face severe difficulty in passing the
Senate should it pass the Committee and the House.
The PBSA Government Relations Committee is working
to express the Association's opposition to these measures
in the House with the expectation that they are likely to
pass as drafted or with limited amendments. Throughout
the year, the Committee has been focused on educating
members of the Senate, including the virtual Advocacy Day
this spring, with an emphasis on members serving on the
Banking Committee in the expectation that the legislation
is more likely to be amended in that chamber. l
