FRB: Consumer Affairs Letter CA 04 - 12 - Interim Examination Procedures for the Fair Credit Reporting Act as Amended by the Fair and Accurate Credit Transaction Act

SUBJECT: Interim Examination Procedures for the Fair Credit Reporting Act, as amended by the Fair and Accurate Credit Transactions Act

The Fair and Accurate Credit Transactions Act (FACTA) of 2003 amended the Fair Credit Reporting Act (FCRA) and created many provisions that impact the compliance examination process. To-date, only one regulation affecting consumer compliance examinations has been finalized. The FACTA provision involving the notice of furnishing negative information has an effective date for compliance of December 1, 2004, and a model notice has been issued by regulation to facilitate compliance. (69 Federal Register 33281 ( June 15, 2004 )). In addition to this regulation, several other provisions of the FACTA that do not require implementing regulations have effective dates of December 1, 2004 , or earlier ("Self-Executing Provisions").

During 2005, the interagency FFIEC FCRA Examination Procedures will be substantively updated to reflect the new FACTA requirements, including the self-executing provisions of the FACTA. In the interim, examiners should immediately use the attached guidance for reviewing compliance with the provisions outlined in the guidance. This guidance will be replaced with formal FFIEC Examination Procedures upon their completion.

Besides the regulation creating the model notice of furnishing negative information, other FACTA provisions require the development of implementing regulations, which have not been finalized. Compliance examinations will not include reviews of these provisions until after the mandatory compliance dates, which will be set forth in the text of the regulations.

If you have any question regarding this interim guidance, please contact your review examiner.