New Democrat Coalition Leads House Democrats Toward Permanent Reauthorization of the Fair Credit Reporting Act with Passage of the FACT ACT;
Financial Services New Dems Provided Initial Momentum

WASHINGTON, DC-- New Democrat Coalition members helped provide the momentum and the votes necessary for the House to approve the reauthorization of the Fair Credit Reporting Act, entitled the Fair and Accurate Credit Transactions Act (HR 2622). Eighty-six percent of New Democrats (64 of 74 voting) voted for final passage of the bill, which was approved overwhelmingly by a vote of 392 yeas - 30 neas - 1 present.

"The nation's credit system is the best in the world thanks in part to the original FCRA, which is an important measure in allowing our credit system to operate in an efficient manner," said Hooley. "New Democrats recognize the importance of permanent reauthorization to our economic recovery."

The legislation, sponsored by Financial Services Subcommittee Chair Spencer Bachus (R-AL), Reps. Darlene Hooley (D-OR), Judy Biggert (R-IL), and Dennis Moore (D-KS), would permanently extend seven expiring provisions of FCRA that they believe are essential to maintaining the integrity of our national credit system in addition to convenience and security for consumers. The bill also includes the main provisions of Hooley's identity theft legislation (HR 2035), which provides for a free annual credit report so consumers can help spot fraud themselves.

"Identify theft is a devastating crime that is on the rise in the United States," said NDC Co-Chair Adam Smith (D-WA). "The FACT Act is an important component of Americans' ability to ensure that their credit is protected, and in turn, enables them to join the battle with creditors and credit bureaus in fighting back.”

Action on the reauthorization moved forward when Congresswoman Darlene Hooley (D-OR) spearheaded a June 11th letter to the Financial Services Committee Chairman Mike Oxley (R-OH) and Ranking Member Barney Frank (D-MA). The letter was cosigned by a dozen Financial Services Committee Democrats who are also members of the New Democrat Coalition, and announced their firm commitment to extending the seven expiring provisions in the Fair Credit Reporting Act that set a national standard for the credit-granting system. The endorsement of the national standard was the first from a coalition of House members, and spurred the momentum necessary to pass the bill in the House.

"Permanent reauthorization of the Fair Credit Reporting Act is a critical step toward stabilizing our economy and providing consumers the protections they need to guard against identity theft," said NDC Co-Chair Jim Davis (D-FL). "The NDC has again played a vital role in driving practical policy solutions that promote growth."

Among the legislation's key components addressing identity theft are: a change of address notification; fraud alerts; a new rule that would permit only a partial display of credit card and debit card numbers on receipts; a mandatory notification of all consumers' rights to suspected victims of identity theft; and one free credit report and score annually from each consumer reporting agency to any consumer requesting a copy.

"Protecting consumers in this age of electronic commerce is critical to growing our new economy," said NDC Co-Chair Ron Kind (D-WI). "With the work of New Democrat members, this bill accomplishes that goal.”

Specifically, the legislation:

Empowers consumers to guard against identity theft by increasing the effectiveness of consumer initiated fraud alerts and enabling consumers to block fraudulent information in their personal credit records after filing a police report;
Increases consumer awareness of their rights if they believe they may be victims of fraud or identity theft;
Improves the accuracy of consumer credit information by discouraging the reintroduction of fraudulent information into the credit reporting system;
Expands consumer access to credit information to ensure accuracy by giving consumers the right to request a free credit report and credit score analysis annually;
Simplifies consumers' ability to limit unsolicited offers of credit;
Enlists financial institutions' support in fighting identity theft by requiring them to develop procedures to "red flag" identity theft, investigate certain changes in customer addresses, and truncate credit and debit card information;
Directs regulators to determine how to increase the prompt investigation and correction of disputed information in a consumer's credit file;
Removes the sunset from the expiring uniform national consumer protection standards to make them permanent.
"This legislation would not only empower consumers with protections," Hooley said, "it also would demand creditors and credit bureaus do their part to combat fraud."

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