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#50393 - 12/23/02 05:44 PM We Can...?
I'd Rather Be Biking Offline
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I'd Rather Be Biking
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Lincoln, NE
Should the back of our new account signature card say that we are authorized to pull a credit report/chexsystem report on the consumer before opening the account? Either way, does this come from FCRA or where?
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#50394 - 12/23/02 06:37 PM Re: We Can...?
rlcarey Online
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rlcarey
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Galveston, TX
Yes - FCRA governs this. You do not need written permission under FCRA as one of the permissible purposes includes:

"otherwise has a legitimate business need for the information in connection with a business transaction that is initiated by the consumer;"

You should consult state or local law for any additional requirements.
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#50395 - 12/23/02 09:07 PM Re: We Can...?
David Dickinson Offline
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Central City, NE
Randy is correct that the FCRA governs this, but why put it on the back of your signature card. You don't have to have the customer's permission and you don't have to tell them. If you do want to tell them, I suggest you put it somewhere more prominent.
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#50396 - 12/26/02 03:41 PM Re: We Can...?
Anonymous
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I believe this is true of permissible purpose. However, some of the fraud detection companies have a more thorough search than that offered by permissible purpose. If you want to use these resources to conduct a more thorough review of newly opened accounts (for instance, the next day), then authorization needs to be included on the sig card or account opening documentation.

MTT

These opinions are my own - and not necessarily shared by my employer.

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#50397 - 12/26/02 03:59 PM Re: We Can...?
rlcarey Online
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rlcarey
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In reply to:

some of the fraud detection companies have a more thorough search than that offered by permissible purpose




Please define to what you are referring. Thanks!
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#50398 - 12/26/02 04:03 PM Re: We Can...?
Mike T Offline
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Posts: 11
ChexSystems, for instance, has a product called Fraud Finder that queries into more databases than what they are permitted to use in a permissible query.

More information can be found at FraudFinder Solution from Efunds

MTT

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#50399 - 12/26/02 04:21 PM Re: We Can...?
rlcarey Online
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Galveston, TX
I wasn't aware that "permissible purpose" limited the type of information that could be included in a "consumer credit report". What information would be included in a "consumer credit report" that you would be allowed to obtain by the mere fact that you obtained written permission over a permissible purpose? Maybe I had a little too much egg-nog over the holidays, but please explain?? Thanks
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#50400 - 12/26/02 05:52 PM Re: We Can...?
waldensouth Offline
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waldensouth
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I haven't looked this up, but somewhere in the recesses of my brain it's telling me you have to have a signature in order to do an investigative report. I'm going to have to dig up FCRA and verify this. If my brain is sending the correct signals (and isn't confused by the sugar high from all of the dessert yesterday) then I guess the question is - Is Fraud Finder and other such services considered an investigative report?
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#50401 - 12/26/02 07:01 PM Re: We Can...?
Andy_Z Offline
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While an investigative report ( 606. Disclosure of investigative consumer reports [15 U.S.C. 1681d]) requires additional disclosures to the consumer, I don't believe it requires a consumers signature.

I wonder if this is the way the poster has always done it, more than a technical requirement.
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#50402 - 12/30/02 03:58 PM Re: We Can...?
I'd Rather Be Biking Offline
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I'd Rather Be Biking
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Lincoln, NE
What about this investigative report and the Patriot Act? If the verification process includes something other than a second form of ID, pulling a credit report, or ChexSystem, then we need an additional disclosure?
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#50403 - 12/30/02 04:10 PM Re: We Can...?
Ross A Offline
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Ross A
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The FCRA defines an "investigative consumer report" as:
"a consumer report or portion thereof in which information on a consumer's character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on or with others with whom he is acquainted or who may have knowledge concerning any such items of information. However, such information shall not include specific factual information on a consumer's credit record obtained directly from a creditor of the consumer or from a consumer reporting agency when such information was obtained directly from a creditor of the consumer or from the consumer."

Restrictions on ICRs are here.

It appears to be an issue only if the info came from personal interviews.
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#50404 - 12/31/02 07:30 PM Re: We Can...?
Elwood P. Dowd Offline
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Next to Harvey
No, you do not need an additional disclosure or, as noted above, written permission. If you make the disclosure or obtain permission you are simply using the "belt and suspenders" approach to compliance; i.e. there is no chance you are going to lose your britches.

Like rlcarey, I would be interested in a citation to anything that indicates a requirement to get permission can be triggered based on the breadth of your query.
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#50405 - 12/31/02 07:36 PM Re: We Can...?
Elwood P. Dowd Offline
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Next to Harvey
Ross,
Thanks for the link. I agree with Andy's summary, an ICR requires additional disclosures to the consumer, but not permission.
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