Currently we use eFunds/Qualifile when opening new accounts to verify and obtain information on our future cusotmers. We're contemplating pulling a Credit Report on them prior to opening the account (to determine if we will open the account).

Where would I begin to look for the necessary disclosures required for this and does anyone have an up- or down-side to pulling the CR instead of continuing on with our current ways.

Thanks

A credit report to open an account? Yikes!

The only difference would be the adverse action notice that you give to customers denied an account would have to reflect the credit bureau used rather than the current credit report bureau that you are usung, i.e., chexsystems, etc. I'm not that familiar with Qualifile and whether the information presented makes them a credut reporting agency.

This may be easier to analyze if you classify the Chexsystems (or its successor) report to be a consumer report, which it is. In other words, if you have the right to pull that type of report then you have the right to pull one from Equifax, etc.

Your responsibilty for notifying a consumer that she was turned down based on information provided by a third party is the same. As noted, only the name of the CRA would change.

Would we need to have the consumer sign anything prior to us pulling the report?

FCRA allows you to pull a consumer report when a conumer applies to do business with you. No signature is necessary as long as it is the consumer who is applying to do business.

A consumer who is a proposed signatory on an entity's acccount; e.g. a corporation, is not applying to do business with you. There, written permission would be required.