FCRA and Reg V AND FF; Prescreens, Sharing with Affiliates and Medical Information

Question 1

What are the three things that the is bank required to send to consumers if they’re included on a prescreen list that was provided by the credit bureau?

Answer 1

1) A firm offer of credit
2) A short form prescreen notice
3) A long form prescreen notice

Question 2

What are the 4 requirements of a short form prescreen notice for each solicitation?

Answer 2

1) A statement that the consumer has the right to opt out of credit solicitations, along with the phone number to do so
2) The title of the notice
3) A statement directing the consumer to the long form notice
4) Must be “clear and distinct” - larger text than the principal text, but not smaller than 12-pt font, on the front page of the solicitation or in close proximity to the principal marketing message

Question 3

What are the 4 requirements of a long form prescreen notice for each solicitation?

Answer 3

1) Must contain the language require by the FACT Act
2) Must appear within the marketing solicitation
3) Must begin with a header that is in all caps, underlined and says, “PRESCREEN & OPT OUT NOTICE” 4) Must be “clear and distinct” - Font no smaller than the principal text and no smaller than 8-pt font, set apart from the other text (indented, with blank lines above and below the statement

Question 4

What is the key difference in the information sharing provisions under FCRA when compared to Regulation P (GLBA)?

Answer 4

The rule under FCRA dictates how information is shared with an affiliate of the bank. The rule under Regulation P (GLBA) dictates sharing within the bank and NON-affiliated third parties.

Question 5

What kind of consumer information can be shared with an affiliate?

Answer 5

Eligibility information (consumer report) and transactional/previous customer experience information.

Question 6

If a customer chooses to opt out of information sharing with affiliates, how long must that remain in effect?

Answer 6

At least 5 years from the time the opt out notice is received by the bank (can be longer or last indefinitely)

Question 7

What can an affiliate do with the information that was shared by the bank, and what are the three requirements for use of the info?

Answer 7

An affiliate may use the limited information to solicit the consumer for marketing, but

ONLY IF:
1) The consumer received a written disclosure stating that the bank may use info received from an affiliate,
2) The consumer was given reasonable opportunity to easily opt out of the solicitation, AND
3) The consumer has not opted out.

Question 8

How long after the provision of the opt-out notice does the bank need to wait before sharing information with affiliates?

Answer 8

No sooner than 30 days after the notice was provided, to ensure that the customer does not opt out.

Question 9

What is the general restriction regarding the use of medical information?

Answer 9

A creditor may not obtain or use medical information to to determine a consumer’s eligibility or continued eligibility for credit.

Question 10

What are the three conditions that must be met in order to obtain or use medical information to determine eligibility or continued eligibility for credit?

Answer 10

1. The information used must be the type of info that’s routinely used to determine credit eligibility (aka, financial - debts, income, etc)
2. The creditor uses the info in a way that is no less favorable that it would use any comparable, NON-medical information
3. The creditor does not consider the consumer’s physical, mental or behavioral health condition as part of a decision to extend or not extend credit