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Fact Act Becomes Effective: But Some Provisions Await Regulations
The Regulatory Agencies issued a letter to all the banking associations regarding their request to postpone the effective date of the Fact Act, due to the absence of regulations and guidance for many of the provisions in the Act.
However, while the Fed agencies agreed that a few of the objections and requests for postponements were valid, they directed that financial institutions are expected to comply with some provisions that took effect December 1 that have no need of enabling regulations. Which means that all financial institutions are now responsible for blocking the reporting of information that is a result of identity theft; incorporating actions that will prevent incorrect information from being reintroduced into a consumer's credit file; disclosing credit scores; and placing fraud and active duty alerts.
At the same time the agencies responded to the concerns raised by the associations and jointly with the Federal Trade Commission issued an official notice that other requirements that were supposed to take effect on December 1 will not take effect until final rules have been issued. Those provisions include the financial institutions procedures for responding to identity theft "red flags"; the proper disposal of consumer information and records; the ability to ensure the accuracy and integrity of information furnished to credit bureaus; a procedure for responding to consumer disputes on credit report information; and providing risk-based pricing notices, which must be furnished if a consumer is offered less favorable credit terms due to information in a credit report.
Copyright © 2004 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 10, 12/04
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