This is the
service agreement to use Real ID, Inc and rTenant ("Service Agreement"). Your
acknowledgement and agreement to these terms, as well as the Terms and
Conditions of the site www.rtenant.com ("Site"), are required to access and/or
use rTenant. You agree to be legally bound by these terms. This Service
Agreement is made and entered into as by and between Real ID, Inc. ("Real ID")
and you/your company ("Subscriber", "You" or "Property Owner"). In consideration
of the promises and mutual covenants hereinafter set forth, Real ID and
Subscriber hereto agree as follows:
Agreement applies to any of those information services which Subscriber may
desire to receive from REAL ID and which REAL ID offers to Subscriber. Such
information services shall herein be collectively referred to as "Services" and
all information derived therefrom shall be collectively referred to as "Services
Information." Subscriber enters in this Agreement on behalf of itself and its
affiliates under common ownership and control, all of which are referred to
collectively as Subscriber.
Subscriber certifies that it is utilizing the Services solely for assisting with
making a residential or storage leasing decision.
Consumer Report Information.
REAL ID makes certain consumer report information services from consumer
reporting databases, including but not limited to consumer credit reports and
criminal record reports ("Consumer Report Information") available to its
customers who have a permissible purpose for receiving such information in
accordance with the Fair Credit Reporting Act (15 U.S.C. "1681 et seq.)
including, without limitation, all amendments thereto ("FCRA"). For the purposes
of this Agreement, the term "adverse action" shall have the same meaning as that
term is defined in the FCRA.
THE FCRA PROVIDES THAT ANY PERSON WHO KNOWINGLY AND WILLFULLY OBTAINS
INFORMATION ON A CONSUMER FROM A CONSUMER REPORTING AGENCY UNDER FALSE PRETENSES
SHALL BE FINED UNDER TITLE 18, OR IMPRISONED NOT MORE THAN TWO YEARS, OR BOTH.
Subscriber certifies that it shall request Consumer Report Information
pursuant to the written authorization of
the consumer who is the subject of the Consumer Report Information. Subscriber
certifies that each such written authorization will expressly authorize
Subscriber to obtain the Consumer Report Information, and will contain at a
minimum the subject"s name, address, social security number (where available)
and signature. Subscriber shall use such Consumer Report Information solely
for Subscriber"s exclusive one-time use and
pursuant to the consumer"s written
authorization use such information solely for assisting with making a
residential or storage leasing decision, and for no other purpose, subject
however, to the additional restrictions set forth herein. Moreover, if requested
by REAL ID, Subscriber agrees to, and
shall, individually certify the permissible purpose for each Consumer Report
Information it requests. Such individual certification shall be made by
Subscriber pursuant to instructions provided from time to time to Subscriber by
REAL ID. Nothing in this certification, or elsewhere in this Agreement,
is intended to allow Subscriber to purchase Consumer Report Information for the
purpose of selling or giving the report, or information contained in or derived
from it, to the subject of the report, or to any other third party, and
Subscriber expressly agrees to refrain from such conduct.
Recommendations. Using Applicant and/or Tenant information provided to REAL
ID by Subscriber ("Applicant/Tenant Information"), REAL ID will obtain consumer
reports relating to each Applicant and/or Tenant and REAL ID will evaluate the
consumer reports ("Applicant/Tenant Reviews"). Based on the results of the
Applicant/Tenant Reviews, REAL ID will provide to Subscriber a Recommendation
with respect to the Applicant and/or Tenant, based on the initial thresholds
established by REAL ID. Such thresholds, delivery specifications and decision
criteria, and any changes thereto, shall be supplied or confirmed by Subscriber
in writing. As part of the Recommendation service, REAL ID shall also provide to
Subscriber a sample letter containing information as to why the Applicant and/or
Tenant was or was not approved. It is Subscriber"s obligation, however, to
ensure compliance with any legal obligations when providing any information to
an Applicant and/or Tenant.
Rental Decisions to be made by Subscriber.
Subscriber acknowledges and agrees that REAL ID provides
only Recommendations as to actions concerning an Applicant or a Tenant, and
further acknowledges and agrees that all decisions of whether or not to rent
property to a particular Applicant or Tenant, as well as the length of and terms
of any such rental, will be made by Subscriber. REAL ID shall have no liability
to Subscriber or to any Applicant, Tenant or other person or entity for any
rental, or the failure to rent, to any Applicant or Tenant, or the terms of any
such rental, regardless of whether or not Subscriber's decision was based on
Recommendations, Consumer Report Information, , public records, or other
information provided to Subscriber by REAL ID.
with Laws. Subscriber shall be responsible for compliance with all
applicable federal (including, but not limited to the FCRA) and state
legislation, regulations and judicial actions, as now or as may become
effective, to which it is subject.
Fraud Prevention Services.
REAL ID offers several fraud prevention services that evaluate inquiry input
elements against other input elements and/or against proprietary databases, to
identify potential discrepancies and/or inaccuracies. Fraud prevention service
messages may be delivered with Consumer Report Information as a convenience, but
are not part of a consumer"s file nor are they intended to be consumer reports.
In the event Subscriber obtains any fraud prevention services from REAL ID in
conjunction with Consumer Report Information or as a stand alone service,
Subscriber shall not use the fraud prevention services, in whole or in part, as
a factor in establishing an individual"s creditworthiness or eligibility for
credit or insurance, or employment, nor for any other purposes under the FCRA.
Moreover, Subscriber shall not take any adverse action, which is based in whole
or in part on the fraud prevention services, against any consumer. As a result
of information obtained from the fraud prevention services, it is understood
that Subscriber may choose to obtain additional information from one or more
additional independent sources. Any action or decision as to any individual
which is taken or made by Subscriber based solely on such additional information
obtained from such additional independent source(s) shall not be deemed
prohibited by this paragraph.
Subscriber may request, in writing, that REAL ID provide Subscriber certain
scores (e.g. scores received from credit reporting agencies ("Bureau Score"),
Real ID, Score, rTenant Score), in connection with the delivery of a consumer
report obtained hereunder, collectively referred to herein as "Scores" for
Subscriber"s exclusive use. REAL ID agrees to perform such processing as
reasonably practicable. Subscriber shall use Scores only in accordance with its
permissible purpose under the FCRA and may store Scores solely for Subscriber"s
own use in furtherance of Subscriber"s original purpose for obtaining the
Scores. Subscriber shall not use the Scores for model development or model
calibration and shall not reverse engineer the Scores.
Adverse Action Factors. Subscriber recognizes that factors other than the
Scores may be considered in making a decision as to a consumer. Such other
factors include, but are not limited to, the credit report, the individual
account history, application information, and economic factors. REAL ID may
provide score reason codes to Subscriber, which are designed to indicate the
principal factors that contributed to the Bureau Score, and may be disclosed to
consumers as the reasons for taking adverse action, as required by the Equal
Credit Opportunity Act ("ECOA") and its implementing Regulation ("Reg. B"). The
Bureau Score itself, when accompanied by the corresponding reason codes, may
also be disclosed to the consumer who is the subject of the Bureau Score.
However, the Bureau Score itself may not be used as the reason for adverse
action under Reg. B.
Confidentiality of Scores. The Real ID Score and the rTenant Score are
proprietary to REAL ID and the Bureau Score is proprietary to the credit
reporting agency supplying the Bureau Score and, accordingly, without
appropriate prior written consent, neither the Real ID Score, the RTenant Score,
or the Bureau Score may be sold, licensed, copied, reused, disclosed,
reproduced, revealed or made accessible, in whole or in part, to any Person
except: (a) as expressly permitted herein; (b) to those employees of Subscriber
with a need to know and in the course of their employment; (c) to those third
party processing agents of Subscriber who have executed an agreement that limits
the use of the Scores by the third party only to the use permitted to Subscriber
and contains the prohibitions set forth herein regarding model development,
model calibration and reverse engineering; (d) when accompanied by the
corresponding reason codes, to the consumer who is the subject of the Score; or
(e) as required by law. Subscriber shall not, nor permit any third party to,
publicly disseminate any results of the validations or other reports derived
from the Scores without prior written consent.
Score Performance. Certain Scores are implemented with standard minimum
exclusion criteria. REAL ID shall not be liable to Subscriber for any claim,
injury or damage suffered directly or indirectly by Subscriber as a result of
any Subscriber requested changes to the exclusion criteria which result in
normally excluded records being scored by such Scores. REAL ID warrants that the
scoring algorithms used in the computation of the scoring services, provided
under this Agreement, ("Models") are empirically derived from credit data and
are a demonstrably and statistically sound method of rank-ordering candidate
records with respect to the purpose of the Scores when applied to the population
for which they were developed, and that no scoring algorithm used by a Score
uses a "prohibited basis" as that term is defined in ECOA and Reg. B promulgated
thereunder. The Bureau Score may appear on a credit report for convenience only,
but is not a part of the credit report nor does it add to the information in the
report on which it is based.
Party Scores and Other Third Party Services. REAL ID has the capability to
offer scores derived from models built jointly with third parties, and other
services provided by third parties, which are subject to additional warranties
offered or terms imposed by such third parties. If desired by Subscriber, such
third party scores and services shall be made available pursuant to separate
agreement, which shall be appended as a schedule to this Agreement.
REAL ID may offer the ability to electronically maintain and make available to
Subscriber, at Subscriber"s request and direction, Subscriber"s forms including,
but not limited to, lease forms, lease addenda and consumer correspondence.
Subscriber acknowledges and agrees that it is Subscriber"s obligation to ensure
the accuracy and completeness of the forms and to ensure its compliance with all
applicable laws related to the use of such forms. REAL ID makes no
representations or warranties as to the content or use of such forms.
Subscriber agrees that REAL ID may store data provided to Subscriber hereunder
on behalf of Subscriber to be used by Subscriber solely for audit purposes and
for no other purpose. All data stored on behalf of Subscriber by REAL ID shall
be owned by Subscriber and may not be modified in any manner.
Additional Terms and Conditions.
Subscriber shall hold all Services Information in confidence and shall not
disclose the Services to any third party, except as required by law (i.e., an
order of a court or data request from an administrative or governmental agency
with competent jurisdiction) to be disclosed; provided however, that Subscriber
shall provide REAL ID ten (10) days prior written notice before the disclosure
of such information pursuant to this Paragraph 5.1. However, this restriction
shall not prohibit Subscriber from disclosing to the subject of the Consumer
Report Information, who is the subject of an adverse action, the content of the
Consumer Report Information as it relates to any such adverse action.
Web Site Access.
REAL ID will provide Subscriber with access to REAL ID's web site (the "REAL ID
Site") so that Subscriber may, by accessing the REAL ID Site, (i) initiate
Applicant Reviews and Tenant Reviews and (ii) obtain or review REAL ID's
Recommendations to Subscriber. REAL ID will assign one or more passwords and
identification numbers ("Program Codes") to Subscriber for use in accessing the
REAL ID Site. Subscriber represents and warrants that it will use its best
reasonable efforts to ensure that: (1) only authorized Subscriber employees have
access to the REAL ID Site through Workstations; (2) REAL ID Services obtained
by Subscriber via the REAL ID Site are not accessible by unauthorized parties
via Subscriber's connection to the Internet or otherwise; (3) all Passwords are
kept confidential and secure by such authorized Subscriber employees (e.g.,
Subscriber shall ensure that Passwords are not stored on any Workstation nor
other storage and retrieval system and/or media and that Internet browser
caching functionality is not used to store Passwords; (4) each User ID and
Password is used solely by the authorized Subscriber employee to whom such User
ID and Password was issued; and (5) all documentation and other materials
provided by REAL ID to Subscriber under this Agreement are held in confidence by
Subscriber (and accessible only to those Subscriber employees who Subscriber has
authorized to use the REAL ID Site). Subscriber shall immediately notify REAL ID
if a Subscriber user with access to Program Codes no longer works for Subscriber
and shall be fully responsible for any use of the REAL ID site by users
accessing the site through the Program Codes assigned to the Subscriber. In the
event of any compromise of security involving User Ids or Passwords, Subscriber
shall immediately notify REAL ID.
Each party shall implement, and shall take measures to maintain, reasonable and
appropriate administrative, technical, and physical security safeguards
("Safeguards") to (a) insure the security and confidentiality of non-public
personal information; (b) protect against anticipated threats or hazards to the
security or integrity of non-public personal information; and (c) protect
against unauthorized access or use of non-public personal information that could
result in substantial harm or inconvenience to any consumer. When a consumer"s
first name or first initial and last name in combination with a social security
number, driver"s license or Identification Card Number, or account number,
credit or debit card number, in combination with any required security code,
access code, or password that would permit access to an individual"s financial
account ("Personal Information"), is delivered to Subscriber unencrypted,
implement and maintain reasonable security procedures and practices appropriate
to the nature of the information and to protect the Personal Information from
unauthorized access, destruction, use, modification, or disclosure. Subscriber
shall notify REAL ID in writing as soon as practicable but in no event later
than forty-eight hours after which Subscriber becomes aware of any potential
and/or actual misappropriation of, and/or any unauthorized disclosures of, any
information provided to Subscriber by REAL ID, including, but not limited to
theft, loss or interception of Consumer Report Information, unauthorized use of
REAL ID subscriber codes and passwords, unauthorized entry to the facilities
where REAL ID data may have been accessible, or unauthorized release of or
access to REAL ID data by an employee or Agent of Subscriber. Subscriber shall
fully cooperate with REAL ID in any communications to consumers regarding the
data incident and mitigating, to the extent practicable, any damages due to such
misappropriation and/or unauthorized disclosure. Such cooperation shall include,
but not necessarily be limited to, allowing REAL ID to participate in the
investigation of the cause and extent of such misappropriation and/or
unauthorized disclosure. Such cooperation shall not relieve Subscriber of any
liability it may have as a result of such a misappropriation and/or unauthorized
disclosure. Moreover, without REAL ID"s prior consent, Subscriber shall make no
public notification, including but not limited to press releases or consumer
notifications, of the potential or actual occurrence of such misappropriation
and/or unauthorized disclosure of any such information provided to Subscriber.
Subscriber shall use the Services: (a) for its certified permissible purpose
above to assist in making a residential or storage leasing decision; (b) solely
for Subscriber"s exclusive one-time use; and (c) subject to the terms and
conditions of this Agreement. Subscriber shall not request, obtain or use
Services for any other purpose including, but not limited to, for the purpose of
selling, leasing, renting or otherwise providing information obtained under this
Agreement to any other party, whether alone, in conjunction with Subscriber"s
own data, or otherwise in any service which is derived from the Services.
Services shall be requested by, and disclosed by Subscriber to only Subscriber"s
designated and authorized employees having a need to know and only to the extent
necessary to enable Subscriber to use the Services in accordance with this
Agreement. Subscriber shall ensure that such Subscriber designated and
authorized employees shall not attempt to obtain any Services on themselves,
associates, or any other person except in the exercise of their official duties.
Third Party Intermediaries.
In the event Subscriber will utilize a third party intermediary (e.g., Internet
service provider or other network provider) for the purpose of receiving
Services, Subscriber shall first enter into an agreement with such third party
under which such third party acts solely as a network
conduit for the delivery of the Services to Subscriber and which
prohibits such third party from using, or otherwise accessing, the Services for
any other purpose. Subscriber shall be solely liable for any actions or
omissions of such third parties which result in a breach of this Agreement.
Rights to Services.
Subscriber shall not attempt, directly or indirectly, to reverse engineer,
decompile, or disassemble Services or any confidential or proprietary criteria
developed or used by REAL ID relating to the Services provided under this
Agreement. Except as explicitly set forth in this Agreement, the entire right,
title and interest in and to the Services shall at all times vest exclusively in
REAL ID. REAL ID reserves all rights not explicitly granted to Subscriber under
Fees and Payments.
Though Subscriber has the option to request that the applicant/prospective
tenant pay for the Services, the Subscriber is ultimately responsible to REAL ID
for the full payment of the Services. The fees associated with the Services are
as stated on the website and are incorporated by reference. Upon delivery of the
Services, Subscriber will be responsible for immediate payment, and outstanding
amounts will be subject to a late charge of one and one-half percent (1.5%) per
month (18% per year) or the maximum allowed by law, whichever is less. If
collection efforts are required, Subscriber shall pay all costs of collection,
including reasonable attorney"s fees. Any periodic and/or minimum Subscriber
fees under this Agreement are non-refundable, in whole or in part, in the event
of a termination of this Agreement. REAL ID reserves the right to change the
fees and charges from time to time, with such changes referenced on the website.
In addition, in the event that REAL ID"s cost of rendering Services
increases as a result of federal, state or local laws, ordinances or other
regulatory, administrative or governmental acts, then REAL ID may implement a
surcharge subject to the following: (a) any surcharge will be applicable
generally to REAL ID"s customers; and (b) any surcharge will be applied only to
services pertaining to consumers in the geographic area so affected. A
legislative surcharge is imposed on certain types of reports pertaining to
consumers residing in the United States, and an additional surcharge is imposed
on certain reports pertaining to only Colorado residents.
Term, Termination and Survival.
The term of this Agreement shall commence upon the agreeing to the terms of this
Agreement and shall remain in effect until terminated by any party hereto for
any reason whatsoever.
With the exception of REAL ID's obligation to provide Services under this
Agreement, all provisions of this Agreement shall survive any such termination
of this Agreement including, but not limited to, all restrictions on
Subscriber's use of Services Information. Moreover, any such termination shall
not relieve Subscriber of any fees or other payments due to REAL ID through the
date of any such termination nor affect any rights, duties or obligations of
either party that accrue prior to the effective date of any such termination.
REAL ID represents and warrants that the Services will be provided in a
professional and workmanlike manner consistent with industry standards.
REAL ID DOES
NOT WARRANT THE SERVICES TO BE UNINTERRUPTED OR ERROR-FREE OR THAT THE SERVICES
WILL MEET SUBSCRIBER'S REQUIREMENTS. THE WARRANTY SET FORTH IN THIS SECTION 5.10
IS IN LIEU OF ALL OTHER WARRANTIES, WHETHERstatutory,
EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, WARRANTIES THAT MIGHT
BE IMPLIED FROM A COURSE OF PERFORMANCE OR DEALING OR TRADE USAGE OR WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
REAL ID"S SOLE LIABILITY, AND SUBSCRIBER"S SOLE REMEDY, FOR VIOLATIONS OF THIS
AGREEMENT BY REAL ID OR FOR BREACH OF REAL ID"S OBLIGATIONS SHALL BE THE
CORRECTION OF ANY DEFECTIVE SERVICE OR THE REFUND OF FEES PAID FOR SAME.
In no event shall REAL ID be liable for any consequential, incidental, indirect,
special, or punitive damages IN CONNECTION WITH this AGREEMENT, including but
not limited to loss of good will and lost profits or revenue, whether or not
such loss or damage is based in contract, warranty, tort, negligence, strict
liability, indemnity, or otherwise,EVEN
IF REAL ID HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THESE
LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY
ADDITIONALLY, REAL ID SHALL NOT BE LIABLE TO SUBSCRIBER FOR ANY AND ALL CLAIMS
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT BROUGHT MORE THAN TWO (2)
YEARS AFTER THE CAUSE OF ACTION HAS ACCRUED.
Assignment and Subcontracting.
Neither party may assign or otherwise transfer this Agreement, in whole or in
part without the prior written consent of the other. Notwithstanding the
foregoing, REAL ID may assign or transfer this Agreement to a wholly-owned
subsidiary or in the event of a purchase of substantially all of REAL ID"s
assets or in the event of a corporate form reorganization (e.g., LLC to
C-Corporation). Moreover, REAL ID shall have the unrestricted right to
subcontract the Services to be provided to Subscriber by REAL ID under this
Agreement; provided however, that such subcontracting shall not relieve REAL ID
of its obligations under this Agreement. The limited warranty and limitation of
liability provisions set forth in this Agreement shall also apply for the
benefit of REAL ID"s licensors, subcontractors and agents.
No failure on the part of either party to enforce any covenant, agreement, or
condition of this Agreement shall operate as a discharge of such covenant,
agreement, or condition, or render the same invalid, or impair the right of
either party to enforce the same in the event of any subsequent breach by the
This Agreement is not intended to create or evidence any employer-employee
arrangement, agency, partnership, joint venture, or similar relationship.
Whenever possible, each provision of this Agreement will be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law,
such provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement.
REAL ID shall not be liable for any delay in performance or failure to perform
under this Agreement if such delay or failure us caused by conditions beyond
REAL ID" reasonable control.
During the term of this Agreement and for a period of five (5) years thereafter,
REAL ID may audit Subscriber"s policies, procedures and records which pertain to
this Agreement, to ensure compliance with this Agreement, upon reasonable notice
and during normal business hours.
This Agreement shall be construed and governed by the laws of the State of
Illinois, without reference to the choice of law principles thereof.
Subscriber acknowledges and agrees that any notice provided by REAL ID to any
electronic mail address provided by Subscriber shall suffice for proper notice
under this Agreement. Additionally, all of Subscriber"s communications or
notices required or permitted by this Agreement shall be sufficiently given for
all purposes hereunder if given in writing and delivered to REAL ID (i)
personally, (ii) by United States first class mail, (iii) by reputable overnight
delivery service, (iv) by electronic mail, or (v) by facsimile. All notices
delivered in accordance with this Section for REAL ID shall be sent to the
appropriate address or number, as set forth below:
ID: Real ID, Inc.
6444 N. Ridgeway
Lincolnwood, IL 60712
Both Subscriber and REAL ID shall submit to the other party for written
approval, prior to use, distribution, or disclosure, any material including, but
not limited to, all advertising, promotion, or publicity in which any trade
name, trademark, service mark, and/or logo (hereinafter collectively referred to
as the "Marks") of the other party are used (the "Materials"). Both parties
shall have the right to require, at each party's respective discretion and as
communicated in writing, the correction or deletion of any misleading, false, or
objectionable material from any Materials. Moreover, when using the other
party"s Marks pursuant to this Agreement, a party shall take all reasonable
measures required to protect the other party"s rights in such Marks, including,
but not limited to, the inclusion of a prominent legend identifying such Marks
as the property of the other party. In using each other"s Marks pursuant to this
Agreement, each party acknowledges and agrees that (i) the other party"s Marks
are and shall remain the sole properties of the other party, (ii) nothing in
this Agreement shall confer in a party any right of ownership in the other
party"s Marks, and (iii) neither party shall contest the validity of the other
party"s Marks. Notwithstanding anything in
this Agreement to the contrary, without the prior written approval of
Subscriber, REAL ID shall have the right to disclose to third parties
Subscriber"s marks in consumer credit reports containing Subscriber"s account
By signing this Agreement, Subscriber acknowledges receipt of a copy of
the Federal Trade Commission"s "Notice to Users of Consumer Reports: Obligations
of Users Under the FCRA" and a copy of the Federal Trade Commission's "Notices
to Furnishers of Information: Obligations of Furnishers Under the FCRA".
The individual executing this Agreement has direct knowledge of all facts
certified and the authority to both execute this Agreement on behalf of
Subscriber and bind Subscriber to the terms of this Agreement.
This AgreemenT INCLUDING, without
limitation, all exhibits and attachments hereto, constitutes the entire
agreement between REAL ID and subscriber and supersedes all previous agreements
and understandings, whether oral or written, express or implied, solely with
respect to the subject matter of this AGREEMENT. this Agreement may not be
altered, amended, or modified except by written instrument signed by the duly
authorized representatives of both parties.
NOTICE TO USERS OF CONSUMER
OBLIGATIONS OF USERS UNDER THE
Fair Credit Reporting Act (FCRA),15 U.S.C. 1681-1681y, requires that this notice
be provided to inform users of consumer reports of their legal obligations.
State law may impose additional requirements. The text of the FCRA is set forth
in full at the Federal Trade Commission's Website at
the end of this document is a list of United States Code citations for the FCRA.
Other information about user duties is also available at the Commission"s Web
site. Users must consult the relevant provisions of the FCRA for details
about their obligations under the FCRA.
first section of this summary sets forth the responsibilities imposed by the
FCRA on all users of consumer reports. The subsequent sections discuss the
duties of users of reports that contain specific types of information, or that
are used for certain purposes, and the legal consequences of violations. If you
are a furnisher of information to a consumer reporting agency (CRA), you have
additional obligations and will receive a separate notice from the CRA
describing your duties as a furnisher.
OBLIGATIONS OF ALL USERS OF CONSUMER REPORTS
Users Must Have a Permissible Purpose
Congress has limited the use of consumer reports to protect consumers' privacy.
All users must have a permissible purpose under the FCRA to obtain a consumer
report. Section 604 contains a list of the permissible purposes under the law.
ordered by a court or a federal grand jury subpoena. Section 604(a)(1)
instructed by the consumer in writing. Section 604(a)(2)
For the extension of credit as a result of an application from a consumer, or
the review or collection of a consumer's account. Section 604(a)(3)(A)
For employment purposes, including hiring and promotion decisions, where the
consumer has given written permission. Sections 604(a)(3)(B) and 604(b)
For the underwriting of insurance as a result of an application from a consumer.
When there is a legitimate business need, in connection with a business
transaction that is initiated by the consumer. Section 604(a)(3)(F)(i)
review a consumer's account to determine whether the consumer continues to meet
the terms of the account. Section 604(a)(3)(F)(ii)
determine a consumer's eligibility for a license or other benefit granted by a
governmental instrumentality required by law to consider an applicant's
financial responsibility or status. Section 604(a)(3)(D)
For use by a potential investor or servicer, or current insurer, in a valuation
or assessment of the credit or prepayment risks associated with an existing
credit obligation. Section 604(a)(3)(E)
For use by state and local officials in connection with the determination of
child support payments, or modifications and enforcement thereof. Sections
604(a)(4) and 604(a)(5)
addition, creditors and insurers may obtain certain consumer report information
for the purpose of making"prescreened" unsolicited offers of credit or
insurance. Section 604(c). The particular obligations of users of "prescreened"
information are described in Section VII below.
Users Must Provide Certifications
Section 604(f) prohibits any person from obtaining a consumer report from a
consumer reporting agency (CRA) unless the person has certified to the CRA the
permissible purpose(s) for which the report is being obtained and certifies that
the report will not be used for any other purpose.
Users Must Notify Consumers When Adverse Actions Are Taken
term "adverse action" is defined very broadly by Section 603. "Adverse actions"
include all business, credit, and employment actions affecting consumers that
can be considered to have a negative impact as defined by Section 603(k) of the
FCRA " such as denying or canceling credit or insurance, or denying employment
or promotion. No adverse action occurs in a credit transaction where the
creditor makes a counteroffer that is accepted by the consumer.
1. Adverse Actions Based on Information Obtained From a CRA
user takes any type of adverse action as defined by the FCRA that is based at
least in part on information contained in a consumer report, Section 615(a)
requires the user to notify the consumer. The notification may be done in
writing, orally, or by electronic means. It must include the following:
The name, address, and telephone number of the CRA (including a toll-free
telephone number, if it is a nationwide CRA) that provided the report.
statement that the CRA did not make the adverse decision and is not able to
explain why the decision was made.
statement setting forth the consumer's right to obtain a free disclosure of the
consumer's file from the CRA if the consumer makes a request within 60 days.
statement setting forth the consumer's right to dispute directly with the CRA
the accuracy or completeness of any information provided by the CRA.
2. Adverse Actions Based on Information Obtained From Third Parties Who Are Not
Consumer Reporting Agencies
person denies (or increases the charge for) credit for personal, family, or
household purposes based either wholly or partly upon information from a person
other than a CRA, and the information is the type of consumer information
covered by the FCRA, Section 615(b)(1) requires that the user clearly and
accurately disclose to the consumer his or her right to be told the nature of
the information that was relied upon if the consumer makes a written request
within 60 days of notification. The user must provide the disclosure within a
reasonable period of time following the consumer's written request.
3. Adverse Actions Based on Information Obtained From Affiliates
person takes an adverse action involving insurance, employment, or a credit
transaction initiated by the consumer, based on information of the type covered
by the FCRA, and this information was obtained from an entity affiliated with
the user of the information by common ownership or control, Section 615(b)(2)
requires the user to notify the consumer of the adverse action. The notice must
inform the consumer that he or she may obtain a disclosure of the nature of the
information relied upon by making a written request within 60 days of receiving
the adverse action notice. If the consumer makes such a request, the user must
disclose the nature of the information not later than 30 days after receiving
the request. If consumer report information is shared among affiliates and then
used for an adverse action, the user must make an adverse action disclosure as
set forth in I.C.1 above.
Users Have Obligations When Fraud and Active Duty Military Alerts are in Files
a consumer has placed a fraud alert, including one relating to identity theft,
or an active duty military alert with a nationwide consumer reporting agency as
defined in Section 603(p) and resellers, Section 605A(h) imposes limitations on
users of reports obtained from the consumer reporting agency in certain
circumstances, including the establishment of a new credit plan and the issuance
of additional credit cards. For initial fraud alerts and active duty alerts, the
user must have reasonable policies and procedures in place to form a belief that
the user knows the identity of the applicant or contact the consumer at a
telephone number specified by the consumer; in the case of extended fraud
alerts, the user must contact the consumer in accordance with the contact
information provided in the consumer"s alert.
Users Have Obligations When Notified of an Address Discrepancy
Section 605(h) requires nationwide CRAs, as defined in Section 603(p), to notify
users that request reports when the address for a consumer provided by the user
in requesting the report is substantially different from the addresses in the
consumer"s file. When this occurs, users must comply with regulations specifying
the procedures to be followed, which will be issued by the Federal Trade
Commission and the banking and credit union regulators. The Federal Trade
Commission"s regulations will be available at www.ftc.gov/credit.
Users Have Obligations When Disposing of Records
Section 628 requires that all users of consumer report information have in place
procedures to properly dispose of records containing this information. The
Federal Trade Commission, the Securities and Exchange Commission, and the
banking and credit union regulators have issued regulations covering disposal.
The Federal Trade Commission"s regulations may be found at www.ftc.gov/credit.
CREDITORS MUST MAKE ADDITIONAL DISCLOSURES
person uses a consumer report in connection with an application for, or a grant,
extension, or provision of, credit to a consumer on material terms that are
materially less favorable than the most favorable terms available to a
substantial proportion of consumers from or through that person, based in whole
or in part on a consumer report, the person must provide a risk-based pricing
notice to the consumer in accordance with regulations to be jointly prescribed
by the Federal Trade Commission and the Federal Reserve Board. Section 609(g)
requires a disclosure by all persons that make or arrange loans secured by
residential real property (one to four units) and that use credit scores. These
persons must provide credit scores and other information about credit scores to
applicants, including the disclosure set forth in Section 609(g)(1)(D) ("Notice
to the Home Loan Applicant").
OBLIGATIONS OF USERS WHEN CONSUMER REPORTS ARE OBTAINED FOR EMPLOYMENT PURPOSES
Employment Other Than in the Trucking Industry
information from a CRA is used for employment purposes, the user has specific
duties, which are set forth in Section 604(b) of the FCRA. The user must:
Make a clear and conspicuous written disclosure to the consumer before the
report is obtained, in a document that consists solely of the disclosure, that a
consumer report may be obtained.
Obtain from the consumer prior written authorization. Authorization to access
reports during the term of employment may be obtained at the time of employment.
Certify to the CRA that the above steps have been followed, that the information
being obtained will not be used in violation of any federal or state equal
opportunity law or regulation, and that, if any adverse action is to be taken
based on the consumer report, a copy of the report and a summary of the
consumer's rights will be provided to the consumer.
Before taking an adverse action, the user must provide a copy of the report
to the consumer as well as the summary of consumer"s rights. (The user should
receive this summary from the CRA.) A Section 615(a) adverse action notice
should be sent after the adverse action is taken.
adverse action notice also is required in employment situations if credit
information (other than transactions and experience data) obtained from an
affiliate is used to deny employment. Section 615(b)(2)
procedures for investigative consumer reports and employee misconduct
investigations are set forth below.
Employment in the Trucking Industry
Special rules apply for truck drivers where the only interaction between the
consumer and the potential employer is by mail, telephone, or computer. In this
case, the consumer may provide consent orally or electronically, and an adverse
action may be made orally, in writing, or electronically. The consumer may
obtain a copy of any report relied upon by the trucking company by contacting
OBLIGATIONS WHEN INVESTIGATIVE CONSUMER REPORTS ARE USED
Investigative consumer reports are a special type of consumer report in which
information about a consumer's character, general reputation, personal
characteristics, and mode of living is obtained through personal interviews by
an entity or person that is a consumer reporting agency. Consumers who are the
subjects of such reports are given special rights under the FCRA. If a user
intends to obtain an investigative consumer report, Section 606 requires the
The user must disclose to the consumer that an investigative consumer report may
be obtained. This must be done in a written disclosure that is mailed, or
otherwise delivered, to the consumer at some time before or not later than three
days after the date on which the report was first requested. The disclosure must
include a statement informing the consumer of his or her right to request
additional disclosures of the nature and scope of the investigation as described
below, and the summary of consumer rights required by Section 609 of the FCRA.
(The summary of consumer rights will be provided by the CRA that conducts the
The user must certify to the CRA that the disclosures set forth above have been
made and that the user will make the disclosure described below.
Upon the written request of a consumer made within a reasonable period of time
after the disclosures required above, the user must make a complete disclosure
of the nature and scope of the investigation. This must be made in a written
statement that is mailed, or otherwise delivered, to the consumer no later than
five days after the date on which the request was received from the consumer or
the report was first requested, whichever is later in time.
SPECIAL PROCEDURES FOR EMPLOYEE INVESTIGATIONS
Section 603(x) provides special procedures for investigations of suspected
misconduct by an employee or for compliance with Federal, state or local laws
and regulations or the rules of a self-regulatory organization, and compliance
with written policies of the employer. These investigations are not treated as
consumer reports so long as the employer or its agent complies with the
procedures set forth in Section 603(x), and a summary describing the nature and
scope of the inquiry is made to the employee if an adverse action is taken based
on the investigation.
OBLIGATIONS OF USERS OF MEDICAL INFORMATION
Section 604(g) limits the use of medical information obtained from consumer
reporting agencies (other than payment information that appears in a coded form
that does not identify the medical provider). If the information is to be used
for an insurance transaction, the consumer must give consent to the user of the
report or the information must be coded. If the report is to be used for
employment purposes " or in connection with a credit transaction (except as
provided in regulations issued by the banking and credit union regulators) " the
consumer must provide specific written consent and the medical information must
be relevant. Any user who receives medical information shall not disclose the
information to any other person (except where necessary to carry out the purpose
for which the information was disclosed, or as permitted by statute, regulation,
OBLIGATIONS OF USERS OF "PRESCREENED" LISTS
FCRA permits creditors and insurers to obtain limited consumer report
information for use in connection with unsolicited offers of credit or insurance
under certain circumstances. Sections 603(l), 604(c), 604(e), and 615(d).
This practice is known as "prescreening" and typically involves obtaining from a
CRA a list of consumers who meet certain preestablished criteria. If any person
intends to use prescreened lists, that person must (1) before the offer is made,
establish the criteria that will be relied upon to make the offer and to grant
credit or insurance, and (2) maintain such criteria on file for a three-year
period beginning on the date on which the offer is made to each consumer. In
addition, any user must provide with each written solicitation a clear and
conspicuous statement that:
Information contained in a consumer's CRA file was used in connection with the
The consumer received the offer because he or she satisfied the criteria for
credit worthiness or insurability used to screen for the offer.
Credit or insurance may not be extended if, after the consumer responds, it is
determined that the consumer does not meet the criteria used for screening or
any applicable criteria bearing on credit worthiness or insurability, or the
consumer does not furnish required collateral.
The consumer may prohibit the use of information in his or her file in
connection with future prescreened offers of credit or insurance by contacting
the notification system established by the CRA that provided the report. The
statement must include the address and toll-free telephone number of the
appropriate notification system.
addition, once the Federal Trade Commission by rule has established the format,
type size, and manner of the disclosure required by Section 615(d), users must
be in compliance with the rule. The FTC"s regulations will be at
VIII. OBLIGATIONS OF RESELLERS
Disclosure and Certification Requirements
Section 607(e) requires any person who obtains a consumer report for resale to
take the following steps:
Disclose the identity of the end-user to the source CRA.
Identify to the source CRA each permissible purpose for which the report will be
furnished to the end-user.
Establish and follow reasonable procedures to ensure that reports are resold
only for permissible purposes, including procedures to obtain:
the identity of all end-users;
certifications from all users of each purpose for which reports will be used;
certifications that reports will not be used for any purpose other than the
purpose(s) specified to the reseller. Resellers must make reasonable efforts to
verify this information before selling the report.
Reinvestigations by Resellers
Under Section 611(f), if a consumer disputes the accuracy or completeness of
information in a report prepared by a reseller, the reseller must determine
whether this is a result of an action or omission on its part and, if so,
correct or delete the information. If not, the reseller must send the dispute to
the source CRA for reinvestigation. When any CRA notifies the reseller of the
results of an investigation, the reseller must immediately convey the
information to the consumer.
Fraud Alerts and Resellers
Section 605A(f) requires resellers who receive fraud alerts or active duty
alerts from another consumer reporting agency to include these in their reports.
LIABILITY FOR VIOLATIONS OF THE FCRA
Failure to comply with the FCRA can result in state government or federal
government enforcement actions, as well as private lawsuits. Sections 616, 617,
and 621. In addition, any person who knowingly and willfully obtains a
consumer report under false pretenses may face criminal prosecution. Section
FTC"s Web site,
more information about the FCRA, including publications for businesses and the
full text of the FCRA.
Citations for FCRA sections in the U.S. Code, 15 U.S.C. " 1681 et seq.:
Section 602 15 U.S.C. 1681
Section 603 15 U.S.C. 1681a
Section 604 15 U.S.C. 1681b
Section 605 15 U.S.C. 1681c
Section 605A 15 U.S.C. 1681cA
Section 605B 15 U.S.C. 1681cB
Section 606 15 U.S.C. 1681d
Section 607 15 U.S.C. 1681e
Section 608 15 U.S.C. 1681f
Section 609 15 U.S.C. 1681g
Section 610 15 U.S.C. 1681h
Section 611 15 U.S.C. 1681i
Section 612 15 U.S.C. 1681j
Section 613 15 U.S.C. 1681k
Section 614 15 U.S.C. 1681l
Section 615 15 U.S.C. 1681m
Section 616 15 U.S.C. 1681n
Section 617 15 U.S.C. 1681o
Section 618 15 U.S.C. 1681p
Section 619 15 U.S.C. 1681q
Section 620 15 U.S.C. 1681r
Section 621 15 U.S.C. 1681s
Section 622 15 U.S.C. 1681s-1
Section 623 15 U.S.C. 1681s-2
Section 624 15 U.S.C. 1681t
Section 625 15 U.S.C. 1681u
Section 626 15 U.S.C. 1681v
Section 627 15 U.S.C. 1681w
Section 628 15 U.S.C. 1681x
Section 629 15 U.S.C. 1681y