Notices of Rights and Duties Under the Fair Credit Reporting Act

SUMMARY: The Federal Trade Commission is publishing three notices that

it is required to prescribe under recent amendments to the Fair Credit

Reporting Act (FCRA). These are: A summary of consumer rights under the

FCRA; a notice setting forth the responsibilities under the FCRA of

those who regularly furnish consumer report information to consumer

reporting agencies; and a notice setting forth the duties of any person

who uses information covered by the FCRA. These notices must be

distributed by consumer reporting agencies once the amendments to the

FCRA become effective on September 30, 1997. A consumer reporting

agency will be in compliance with the FCRA if it provides notices

substantially similar to those prescribed by the Commission.

DATES: The amendments become effective September 30, 1997.

ADDRESSES: Federal Trade Commission, Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Clarke Brinckerhoff or William Haynes,

Attorneys, Division of Credit Practices, Federal Trade Commission,

Washington, DC 20580, 202-326-3224.

SUPPLEMENTARY INFORMATION: The Fair Credit Reporting Act (FCRA),

originally enacted in 1970,\1\ was extensively amended in 1996. Most of

the amendments to the law, including those discussed in this notice, go

into effect on September 30, 1997.

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\1\ 15 U.S.C. Sections 1681-1681u; Title VI of the Consumer

Credit Protection Act.

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As amended, the FCRA requires each consumer reporting agency

(``CRA, usually a credit bureau) to distribute three types of notices

in order to better educate consumers, furnishers and users of consumer

report information as to their rights or duties under the law. Section

609(c) of the amended FCRA mandates that each CRA provide, as part of

its file disclosure to consumers, a written summary of consumer rights

(``summary'' or ``consumer summary'') under the FCRA. Section 607(d)

requires each CRA to provide a notice to persons who buy consumer

information from the CRA of their responsibilities under the FCRA

(``user notice''), and a notice to persons who regularly furnish

consumer information to the CRA of their responsibilities under the

FCRA (``furnisher notice''). The Federal Trade Commission

(``Commission'') is required to prescribe the content of the notices,

and, in the case of the consumer summary, the form as well. A CRA

complies with the law if it provides the applicable party with a

summary or notice that is substantially similar to the one prescribed

by the Commission.

On February 28, 1997, the Commission published for comment proposed

versions of the three notices (collectively, ``the notices''). The

discussion accompanying the proposed notices outlined in detail the

relevant FCRA sections, and set forth a number of questions designed to

facilitate public comment on the proposals. 62 FR 9123 (1997).

The comment period closed on March 31, 1997. The Commission

received 28 comments from credit bureaus and other CRAs, creditors (and

other parties that make use of consumer reports and/or furnish

information to CRAs), consumers and their representatives, regulatory

authorities, and other interested parties. Although the Commission

stated that it was requesting comments until March 31, 1997, comments

received after that date were taken into account.

This document highlights the principal areas in which the

Commission revised the proposed versions of the notices or decided not

to do so.

I. Consumer Summary

The comments overwhelmingly supported the content and organization

of the proposed summary. Many commenters praised the Commission's

effort in offering a proposal that was thorough, understandable,

succinct, and user-friendly. None suggested any major revision to the

overall presentation. Accordingly, the basic framework of the notice

remains unchanged--a two-page document that starts with an introductory

paragraph explaining the FCRA very generally, features ten ``bullet''

sections to describe significant consumer FCRA rights, and includes the

required list of the federal agencies with FCRA enforcement authority

at the end.

A. Principal Revisions Based on Public Comments

1. Additions and Deletions

The amended FCRA provides conflicting guidance as to whether the

consumer summary should be brief or comprehensive. The law mandates a

``summary of all the rights the consumer has under'' the FCRA (Section

609(c)(1)(A)).

The law also requires ``a brief description of * * * all rights of

consumers'' provided by that law (Section 609(c)(2)(A)). Arguably, no

document that is actually a ``summary''--or that constitutes a ``brief

description'' of FCRA consumer rights--could literally include ``all''

consumer rights.

The Commission specifically asked for suggestions as to areas in

which the proposed form was too long to be effective as a summary, or,

conversely, had omitted something important to consumers. 62 FR 9123,

9124 (1997). The Commission has deleted three items from the proposed

form that were persuasively cited by commenters as unnecessary or not

helpful to the goal of educating consumers about their FCRA rights:

The sentence noting that a CRA is not required to

include a ``risk score'' or ``credit score'' in disclosures to

consumers of their credit histories. The Commission included the

sentence in the proposed summary to try to answer a question that

consumers would otherwise ask of CRAs. Upon review of the diverse

comments,\2\ the Commission now believes that the reference would be

more hindrance than help, and accordingly has deleted it.

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\2\ This sentence in the second bullet (``You can find out what

is in your file'') was based on a clause specifically added to

Section 609(a)(1). One comment from major creditors stated that the

reference should be expanded to refer to ``any information

concerning'' such scores ``or other predictors.'' A more frequent

view, offered by a major CRA, a trade association, and a federal

regulatory agency stated that the section was unnecessary and would

confuse rather than educate consumers.

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A discussion of FCRA litigants' ability to obtain

attorney's fees from one another. The comments made it clear that

the topic cannot be covered both briefly and precisely because of

the complexity of this portion of the amended FCRA.\3\ For that

reason, and because the issue is ancillary to the consumer's right

to sue for damages that continues to be emphasized in this portion

of the summary, the Commission decided not to retain the discussion

of attorney's fees.

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\3\ This sentence, which appeared in the last bullet (``You may

seek damages from violators''), was an effort to synthesize the

various applicable provisions of Sections 616-17, as amended. The

Commission's decision to delete this reference follows the

recommendation of two commenters from disparate points of view--a

nationwide credit bureau and a nationwide consumer advocacy

organization. Other comments suggested expanding it further to make

it more precise.

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The reference to a toll-free number in the case of

nationwide CRAs. National CRAs are required to include this number

in their file disclosures; however (as noted by one such CRA), it

need not be part of the summary.\4\

\4\ This appeared in the proposed notice after the tenth and

last bullet, before the list of federal agencies.

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Conversely, other commenters noted that the summary needed more

discussion of the rights of consumers who dispute file data with CRAs.

These rights, which are central to the FCRA and provide important

protections for consumers, are found in Section 611.\5\ Accordingly,

the Commission has added a discussion of (1) the right provided

consumers by Section 611(b) to add a brief statement to their files

when they continue to dispute information that the CRA has investigated

and concluded to be accurate, and (2) the right of consumers under

Section 611(d) to have revised reports provided to all recent

recipients of information from their files.\6\

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\5\ Because of space limitations, the proposed notice focused on

the rights provided for the first time by the amended section

611(a): the 30-day period for CRA investigations; the CRA obligation

to consider (and pass on to the furnisher of the item) ``all

relevant information'' submitted by the consumer when a dispute

occurs; the consumer's right to a written statement of results of an

investigation; and limits on the ability of CRAs to re-inserts an

item of information deleted pursuant to a consumer dispute.

\6\ These items are now included in the third bullet of the

prescribed notice (``You can dispute inaccurate information with the

CRA''). The sentence dealing with limits on CRA ability to re-insert

information after it had been deleted, previously located there, now

appears in the fourth bullet (``Inaccurate information must be

corrected or deleted'').

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2. Editorial Revisions

The Commission's most significant editorial revisions to the

summary are two adjustments in the opening paragraph to avoid

misleading consumers about the range of parties covered by the FCRA,

and to emphasize consumer rights under state law. In the first case, a

major credit bureau asserted that the proposed summary focused on CRAs

to a degree that is unwarranted in view of the fact that the amended

FCRA also imposes substantial duties on users and furnishers of CRA

data. The Commission therefore revised the text to eliminate the

unnecessary reference to FCRA rights ``in dealing with CRAs (which

must) provide you with a summary of these rights as listed below'' \7\

that preceded the body of the summary. In the second case, state

regulatory authorities asserted that the discussion of state law, which

is specifically required by Section 609(c)(2)(D), should be featured

more prominently. Accordingly, the Commission increased the emphasis by

moving the reference to the opening paragraph. The Commission did not

intend the proposed notice to single out CRAs, or to give short shrift

to state law; these two revisions to the opening paragraph of the

prescribed summary should make that clear.

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\7\ Partially in response to the same comment, the Commission

also revised the tenth and last bullet to refer to the liability of

users and furnishers (as well as CRAs) in civil actions.

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The Commission also adopted some suggestions for stylistic or

technical changes where the Commission believed the change would make

the summary appreciably more precise or useful for consumers. For

example, in the second sentence of the introductory paragraph, the

Commission added an example of consumer report users (landlords) that a

state regulator recommended as useful and deleted a type of CRA

information (where consumers work and live) that industry

representatives cited as a poor example for a summary. Also, the

Commission revised a sentence, formerly in the fourth (now in the third

bullet, to make it clear that national CRAs are not required to report

erroneous information to one another; rather, furnishers must report to

them any disputed data that they find to be inaccurate or incomplete, a

task made easier by an automated system to be created by national CRAs.

The Commission also made some minor changes to improve the

technical legal accuracy of the summary. The heading to the fourth

bullet was expanded (``Inaccurate information must be corrected or

deleted'') to describe precisely a CRA's options when its investigation

shows that disputed information is not accurate.\8\ Similarly, the

statement of consumer's right to sue violators has been amended to

state that furnishers can be sued only ``in some cases'' because the

amended FCRA limits the situations in which consumers are authorized to

sue directly for damages.\9\

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\8\ Both industry and consumer representatives asserted that the

summary should clearly inform consumers that a CRA may cure an

inaccuracy with respect to a disputed item of information by either

deleting the information or amending it to make it accurate.

\9\ Section 623(c) of the amended FCRA specifically bars

consumers from bringing suit against furnishers of information for

violation of the accuracy and reporting duties imposed by Section

623(a), allowing only regulatory authorities to enforce those

provisions.

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B. Principal Public Comments Not Adopted

Commenters made suggestions for stylistic revisions of the consumer

summary, many of which were adopted because they improved the clarity

or comprehensibility of the summary. However, the Commission could not

make all of these changes without unduly lengthening the document.

Because of the large volume of suggested wording and other changes

contained in more than 170 pages of comments received by the

Commission, it is not feasible to discuss them all in this notice. This

section is intended to identify some of the more significant comments

that are not reflected in the finally-prescribed consumer summary.

1. Form of the Summary

The principal credit bureau trade association expressed the view

that the Commission specifications for the form of the summary were

unduly ``rigid'' in two ways. First, the Commission proposed that the

summary be on paper no smaller that 8\1/2\ x 11 inches in size. The

commenter noted that continuous feed forms are not always perforated as

8\1/2\ x 11-inch sheets, and that the requirement that the summary be

``on paper'' would inhibit the possibility of electronic disclosures.

Second, the Commission proposed that the notice be in 12-point type (8-

point for the table at the end). The commenter stated that type sizes

may vary based on the font being used.

Section 609(c)(3) of the amended FCRA specifically states that the

``Commission shall prescribe the form and substance of'' the summary

(emphasis added). The Commission is required by law to prescribe a

format that ensures that consumers will receive a summary that is

readable and useful, and believes that the format prescribed in the

proposed is appropriate for that purpose. However, the Commission does

not intend to impose an absolutely ``rigid'' standard, which would be

inappropriate under the statute. Section 609(a)(3) requires only that a

summary be ``substantially similar'' (i.e., not identical) to the

Commission-prescribed version. Therefore, a format that approximates

that published by the Commission as ``Appendix A'' (which meets the

type size requirements and can be printed, with comfortable margins, on

two 8\1/2\ x 11-inch pages) will comply, even if the print is

technically not 12-point in size because of a different font, or it is

provided on computer paper that is slightly smaller is size. Similarly,

an electronic submission that normally allows the recipient to receive

it in a format similar to the prescribed version will also comply.\10\

Such summaries will not result in the consumer receiving a form that is

harder to read or use than the exact prescribed version.\11\

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\10\ Section 610(a)(12 provides that file disclosures are

normally to be made in writing. However, Section 610(b)(2) allows

the consumer to specify disclosure by other means, including

electronic means if available from the CRA.

\11\ In some cases, a CRA may use an entirely different format

to respond to a consumer request under Section 610(b)(2), or to

accommodate visually (or otherwise) impaired consumers pursuant to

relevant federal or local laws.

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2. Items Required by Section 609(c)(2)

The Commission received a number of comments relating to each of

three sections the amended FCRA requires be included in the summary:

(1) A reference to rights provided by state law, (2) a statement that

the CRAs are not required to delete accurate data that is not obsolete

under Section 605, and (3) a list of federal agencies that have

authority to enforce the FCRA. The Commission made few additions or

deletions in these areas, because Congress has given precise

instructions. This section describes the nature of those comments and

the basis for the Commission's decision in most cases not to change the

proposed form.

State regulators suggested a substantial expansion of the reference

to state law required by Section 609(c) (2) (D), including multiple

references to state and local authorities, and more detailed

instructions on how to reach them. As noted above (para.I-A-2), the

Commission has decided to feature the statutorily-required section more

prominently in the summary. However, the Commission does not believe

the section should be expanded because it currently uses the language

prescribed by Congress.

Several commenters offered revisions of the sentences, required by

Section 609(c)(2)(E), reminding consumers in bold letters that they

cannot require CRAs to remove information that is accurate and not

outdated. The Commission adopted a suggestion by a CFR trade

association to add a parenthetical cross-reference to clarify that

``outdated'' means the FCRA's seven year period (ten for bankruptcies),

a change that made the bold statement more precise. It did not adopt

suggestions for change that were not specifically authorized by the

statute.\12\

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\12\ One CRA accurately pointed out that it is not technically

correct to imply that a CRA must ``remove'' outdated accurate

information from its files, because such data may be retained to be

reported in situations listed in Section 605(b) where the

obsolescence provisions do not apply. However, it is common practice

for credit bureaus to delete information from their files before the

time periods set forth in Section 605; thus, it makes sense that

Section 609(c) (2) (E) should direct that a summary, as opposed to a

legal brief, include a statement concerning limits on the CRA's duty

to ``remove'' outdated data.

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Similarly, the Commission did not adopt suggestions by commenters

to reduce the list of federal agencies with regulatory authority.

Section 609(c) (2) (C) requires that the summary include ``a list of

all federal agencies responsible for enforcing [the FCRA] and the

address and any appropriate phone number of each such agency, in a form

that will assist the consumer in selecting the appropriate agency.''

Suggestions for pruning this section involved using a narrative to

replace the required ``list,'' reducing the list from ``all'' agencies

by eliminating those deemed to be of low interest to consumers, and

other revisions that would delete or reduce the jurisdictional

summaries designed to ``assist the consumer in selecting the

appropriate agency.'' The comments appeared well-intended, but the

Commission concluded that the summary should reflect the specific

instructions of Congress on this point.

3. Use of ``CRA'' as an Acronym

A number of commenters from different sectors asserted that ``CRA''

is an awkward acronym for ``consumer reporting agency; most of them

suggested that ``credit bureau'' would be more easily understood. Some

opined that ``CRA'' is too easily confused with a common acronym for

the Community Reinvestment Act.

The term ``credit bureau'' is certainly known to more consumers

than ``CRA,'' but it has major drawbacks that the Commission believes

make its use inappropriate here. The FCRA unquestionably applies to all

consumer reporting agencies, a universe that includes more than credit

bureaus (e.g., specialized CRAs that report only on mortgage or tenant

applications, or only on consumers' check writing habits). It thus

would be legally inaccurate to use ``credit bureau'' as a replacement.

In addition, it would make the summary confusing to a consumer who

receives it from a CRA that is not a credit bureau. While some

commenters who are knowledgeable about financial laws may be accustomed

to `CRA'' as an acronym for the Community Reinvestment Act, only a

small fraction of consumers who get this summary may make such a

connection.\13\

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\13\ Of course, a credit bureau may elect to replace ``CRA''

with ``agency'' or some other appropriate term in the notice it

provides to any party, because it would be ``substantially similar''

to the Commission's form under Section 609(c) (3).

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II. Notices to Furnishers and Users

The furnisher and user notices occasioned relatively few comments,

and thus are little changed from the proposed versions. The Commission,

responding to a suggestion by state regulators, added a sentence to

each notice referring to the possible applicability of state law. With

the exception of a few subjects discussed in the following sections on

each of these notices, the only changes were revisions that were very

slight adjustments that the Commission believes, based on the comments,

would make the notice more clearly reflect the FCRA and be of

assistance to the recipients.

The Commission specifically asked whether the public wanted

guidance as to the timing and frequency of notice distribution, in view

of the amended FCRA's silence on the point. 62 FR 9123, 9125, (1997).

The overwhelming majority of the commenters did not address the issue,

and those who commented gave very different views--a comment from state

regulators advocated requiring frequent notices, two furnishers/users

asked for a ruling limiting or not requiring multiple notices, and a

CRA trade association urged that the marketplace be allowed to work its

will in light of the FCRA silence. Based on the limited number of (and

wide disagreement among) commenters, formal guidance on these issues at

this early stage seems unwise. If experience after the amendments

become effective indicates a need for such action, the Commission can

revisit the issue.

A. Furnisher Notice

The one significant change in the furnisher notice is the addition

of a reference to the fact that two of the sections apply only to

parties that furnish information to CRAs regularly and in the ordinary

course of their business.\14\ The Commission specifically asked for

public comment on this issue. 62 FR 9123, 9125 (1997). There was a

consensus among the commenters that the notice should be revised to

include reference to the different standards that apply to occasional

user.

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\14\ Sections 623 (a)(2) and (a)(4) provide that the obligations

described in the notice as ``Duty to Correct and Update

Information'' and ``Duty to Report Voluntary Closing of Credits

Accounts'' apply only to such parties.

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Representatives of different furnishers suggested two additions

that the Commission did not adopt. First, credit card issuers advocated

adding a section spelling out the limitations on consumers' ability to

sue furnishers, a topic that seemed inappropriate for a Commission-

prescribed notice of duties to furnishers. Second, debt collectors and

creditors urged that the notice specify that a furnisher's duty to

report an item as ``disputed'' lasts only while it is investigating the

dispute. This point involves an issue of statutory interpretation that

is more appropriately resolved in another forum.

Finally, the Commission asked for comments on whether the

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form should include the text of Section 623. 62 FR 9123, 9125 (1997).

The Commission has not included the text, because the commenters

generally stated that it was unnecessary. However, a CRA form that does

so will be ``substantially similar'' and thus in compliance with

Section 609(c).

B. User Notice

The Commission asked for comment as to whether it should prescribe

separate notices for different types of specialized users (62 FR 9125).

The overwhelming majority of the commenters stated that a single notice

(as the Commission proposed) was best.

One commenter representing specialized reporting services, while

agreeing that a single notice is appropriate for most CRAs, stated that

its members' business activities are so focused that the information

provided to their clients would never relate to some of the points in

the comprehensive notice. As an example, the commenter asserted that

the portions of the proposed notice concerning employment reports

(section II of the Notice), investigative reports (section III),

medical information (section IV) or precreened lists (section V) might

not be pertinent to purposes of any clients of a mortgage reporting

company. Similarly, it noted that a different set of sections might not

be relevant to the purposes of any customers of a CRA that provides

reports only for employment or tenant screening uses. The Commission

agrees that a CRA may delete sections of the notice that are irrelevant

to the business purposes for which any user is contractually authorized

to purchase consumer reports for the CRA, in the same fashion that a

creditor may omit inapplicable sections of prescribed forms under other

statutes.\15\

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\15\ Creditors are required to notify consumers of their rights

under the Fair Credit Billing Act, Regulation Z Sec. 226.6(d), 12

CFR 226.6(d). The Federal Reserve Board has prescribed forms for

that purpose. Regulation Z, Appendix G, Forms G-3 and G-4. However,

creditors that do not issue credit cards may omit a section in the

form on the rights of cardholders, and creditors that are not able

to debit a savings or checking account for payment may omit a

section about the consumer's right to stop such debits. Official

Staff Commentary for Regulation Z, Appendix G-3, 12 CFR part 226,

Supp. I.

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The only significant addition to the user notice is in Section I-B

of the notice, concerning the certification of permissible purpose that

users must provide to CRAs that sell consumer reports to them. Several

parties advocated that the Commission expand this Section to account

for the possibility of a general certification, as permitted by Section

604(f). The Commission has done so, but added the words ``as

appropriate'' to make it clear that some consumer report users whose

activities involve both permissible and impermissible purposes,\16\ or

who have given the CRA reason to believe they have violated a general

certification, must be required to provide individual certifications

for each consumer report.

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\16\ Certain businesses typically have both permissible and

impermissible purposes--e.g., an attorney could obtain a consumer

report to decide whether to hire a job applicant or to extend credit

to a client, but not to decide whether to name a person as a

defendant in a tort action.

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III. Impact on Small Businesses

In publishing the proposed notices, the Commission stated that the

notices would not have a significant economic impact on a substantial

number of small entities. The Commission explained that it is

prescribing that notices at the direction of Congress, so that any

economic costs imposed on small entities by the required dissemination

of the notices are in fact imposed by statute. The Commission noted

further that its publication of forms for the proposed notices could be

said to lessen the burden on small businesses, since the entities can--

but need not--adopt the Commission's forms, and thereby avoid the risk

and expense of developing their notices independently. The Commission

nevertheless requested comments in order to ensure that it did not

overlook any substantial economic impact on small businesses.

The Commission received four comments addressing the question of

the notices' economic impact on small businesses. Two commenters agreed

that the Commission's publication of the notices would not have a

significant economic impact on a substantial number of small

businesses. One commenter disagreed, but provided data supporting the

conclusion that the statutory requirement would create a significant

economic impact, rather than any evidence that the Commission's

publication of the model forms for the notices would do so. Finally,

one commenter stated that small businesses would be significantly

burdened if the Commission were to require repeated distribution of the

notices. As stated in the second paragraph of Section II above, the

Commission has determined not to impose any requirements concerning the

timing and frequency of dissemination of the notices at this time.

Accordingly, the Commission has determined that public comments and

information before the Commission do not alter the conclusion that its

pbulicaiton in final form of the models for the prescribed notices will

not have a significant economic impact on a substantial number of small

entities.

IV. Paperwork Reduction Act

In its initial review of the proposed notices, the Commission

considered whether it was ``sponsoring or conducting'' any

``collection[s] of information'' that would trigger the provisions of

the Paperwork Reduction Act, 44 U.S.C. Chapter 35. In this regard, the

Commission observed that the notices contain only statutorily imposed

investigation disclosure, and recordkeeping requirements; the FTC

introduces no additional elements. Further, two of the notices will

become effective on September 30, 1997, regardless of whether the FTC

has provided the language for these forms by that time. In this

situation, the Commission does not ``require'' or ``cause'' the

disclosures to occur.

The Commission also observed that the three notices contain all the

information that subject firms will be required to disclose to third

parties. The reporting agencies can simply adopt these notices for

distribution without any change to the language. Therefore, the three

notices fall within an exception to the definition of a ``collection of

information'' as being ``[t]he public disclosure of information

originally suppled by the Federal government to the recipient for the

purpose of disclosure to the public.'') 5 CFR 1320.3(c)(2).

Accordingly, none of the three require approval by OMB. Nonetheless,

the Commission requested public comment on this matter. No comments

were received.

List of Subjects in 16 CFR Part 601

Credit, Trade practices.

Pursuant to 15 U.S.C. 1681g and 1681s, the FTC hereby adds to

Subchapter F of Chapter I of 16 CFR a new Part 601 to read as follows:

PART 601--SUMMARY OF CONSUMER RIGHTS, NOTICE OF USER

RESPONSIBILITIES, AND NOTICE OF FURNISHER RESPONSIBILITIES UNDER

THE FAIR CREDIT REPORTING ACT

Sec.

601.1 Authority and purpose.

601.2 Legal effect.

Appendix A to Part 601--Prescribed Summary of Consumer Rights

Appendix B to Part 601--Prescribed Notice of Furnisher

Responsibilities

Appendix C to Part 601--Prescribed Notice of User Responsibilities

Authority: 15 U.S.C. 1681g and 1681s.

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Sec. 601.1 Authority and purpose.

(a) Authority. This part is issued by the Commission pursuant to

the provisions of the Fair Credit Reporting Act (15 U.S.C. 1681 et

seq.), as most recently amended by the Consumer Credit Reporting Reform

Act of 1996 (Title II, Subtitle D, Chapter 1, of the Omnibus

Consolidated Appropriations Act for Fiscal Year 1997), Public Law 104-

208, 110 Stat. 3009-426 (Sept. 30, 1996).

(b) Purpose. The purpose of this part is to comply with sections

607(c) and 609(c) of the Fair Credit Reporting Act, as amended. Section

609(c)(3) directs the FTC to prescribe the form and content of a

summary of consumers' legal rights under the FCRA that the amended law

requires each consumer reporting agency to provide when disclosing the

information in its file to consumers, and section 609(c)(4) provides

that the summary need not be provided until the FTC has in fact

prescribed its form and content. Section 607(d)(2) directs the FTC to

prescribe the content of notices that consumer reporting agencies are

required to provide to parties that supply information to, or purchase

consumer reports from, the agency. These notices will set forth the

responsibilities under the FCRA of all persons who furnish information

to consumer reporting agencies or use information subject to the FCRA.

Sec. 601.2 Legal effect.

The forms prescribed by the FTC do not constitute a trade

regulation rule. They carry out the directive in the statute that the

FTC prescribe the summary and notices. A consumer reporting agency that

provides notices substantially similar to those prescribed by the FTC

will be in compliance with Section 607(d) or 609(c) of the FCRA, as

applicable.

Appendix A to Part 601--Prescribed Summary of Consumer Rights

The prescribed form for this summary is as a separate document,

on paper no smaller than 8\1/2\ x 11 inches in size, with text no

less than 12-point type (8-point for the chart of federal agencies),

in bold or capital letters as indicated. The form in this appendix

prescribes both the content and the sequence of items in the

required summary. A summary may accurately reflect changes in

numerical items that change over time (e.g., dollar amounts, or

phone numbers and addresses of federal agencies), and remain in

compliance.

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By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 97-17004 Filed 6-30-97; 8:45 am]

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