FTC Seeks Comments on Proposed Fee for Credit Scores
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FTC Seeks Comments on Proposed Fee for Credit Scores
 

CThe Federal Trade Commission is seeking public comment on different approaches to determining a 'fair and reasonable' fee for credit scores under the Fair and Accurate Credit Transactions Act (FACTA) and the Fair Credit Reporting Act (FCRA). FACTA, which was enacted on December 4, 2003, amends the FCRA and requires, among other things, that nationwide consumer reporting agencies (CRAs) provide to consumers, upon request, a copy of their credit scores.

A credit score is a numeric characterization of a consumer's credit history, which creditors may use to predict the level of risk associated with providing credit to the consumer. Generally, a higher score indicates lower predicted risk. Consumers can purchase their credit score from the three nationwide credit bureaus or other companies not covered under FACTA. The cost for credit scores currently appears to be between $4 and $8. FACTA directs the Commission to develop a 'fair and reasonable' fee for credit bureaus to charge consumers for a copy of their credit score beginning
December 1, 2004.

In a Federal Register notice published today, the Commission presents several approaches for determining a reasonable fee for score disclosure. The Commission seeks comments on these approaches and on the various factors and methods that should be considered in determining the appropriate fee. The Commission also seeks comment on: (1) the state of the current market in direct-to-consumer scores; (2) the percentage of the credit score market that would be regulated, and what percentage unregulated, under the FCRA; (3) the competitive effects of the imposition of a maximum price requirement that applies only to part of the market for credit scores; (4) whether consumer reporting agencies will choose to fulfill their obligation under the FCRA directly or through subsidiaries; (5) the appropriate market to consider if the Commission chooses to determine a fee based on the market for scores; (6) whether factors other than price should be considered in determining a fee based on the market for scores; and (7) should the Commission choose a specific dollar amount, whether it should include a mechanism for periodic adjustment of the price, and if so, what factors should determine the need for an adjustment.

Written comments should refer to 'FACTA Credit Score Fee, Project No. R411004' both in the text and on the envelope, and should be mailed to the following address: Federal Trade Commission/Office of the Secretary, Room H-159 (Annex O), 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Comments containing confidential material must be filed in paper form. The FTC is requesting that any comment filed in paper form be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions. Comments also may be filed electronically at: https://secure.commentworks.com/ftc-CreditScoreFee.

The Commission vote approving publication of the Federal Register Notice was 5-0.

Copies of the Federal Register notice are available from the FTC's Web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business Practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

MEDIA CONTACT:

Jen Schwartzman
Office of Public Affairs
202-326-2674

STAFF CONTACT:

Christopher Keller
Division of Financial Practices
202-326-3224

(FTC File No. R411004)
.

About the ICFE:

The Institute of Consumer Financial Education (ICFE) was founded in 1982 by the late Loren Dunton (creator of the Certified Financial Planner (CFP) designation).  The ICFE is dedicated to helping consumers of all ages to improve their spending, increase savings and use credit more wisely. 
The ICFE is an award winning, nonprofit, consumer education organization that has helped millions of people through its education programs and Resources. It publishes the Do-It-Yourself Credit File correction Guide, which is updated annually. The ICFE has distributed over one million Credit/Debit Card Warning Labels and Credit/Debit Card Sleeves world wide.

The ICFE became an official partner with the Department of Defense/Financial Readiness Campaign in June of 2004.The ICFE was an active partner in the California Student Debt Resource Awareness Project (CASDRAP) which resulted in a new web site: (studentdebthelp.org).  CASDRAP disbanded in 2010, shortly after the web site project was completed.  In 2011 the ICFE assumed the single sponsorship of the (studentdebthelp.org) web site and is now responsible for its content and operation.

The ICFE is also an on-line help for consumers who spend too much.  ICFE's spending help was featured in PARADE Magazine in the Intelligence Report section. The money helps and tips are from the ICFE's Money Instruction Book, our course in personal finance.

Visit the ICFE's other web sites at: www.financial-education-icfe.org and studentdebthelp.org.  Both sites helps consumers and students with mending spending, learning about the proper use of credit, budget and expense guidelines, how to set up and implement a spending-plan and also how to access financial education courses and how to teach children about money. Other ICFE services include: Ask Mr. G,  a free eNews, and an online resource center for students, parents and educators, plus financial education learning tools and a book store.

 
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