FCRA Permissible Purpose & End-User Requirements

Question 1

Under FCRA Section 604, which of the following constitutes a permissible purpose for obtaining a consumer report?

Accepted Answer

A creditor reviewing an account for credit extension

Answer

Personal curiosity about a neighbor's finances

Answer

An employer checking on a friend's personal finances

Answer

A landlord investigating a tenant's political views

Question 2

Which party bears primary responsibility for certifying permissible purpose before accessing a consumer report from a CRA?

Accepted Answer

The end user requesting the report

Answer

The consumer whose report is being requested

Answer

The consumer reporting agency furnishing the report

Answer

The Federal Trade Commission

Question 3

A landlord seeking a consumer report on a prospective tenant would rely on which permissible purpose under Section 604?

Accepted Answer

Legitimate business need in connection with a transaction initiated by the consumer

Answer

Employment screening purposes

Answer

Insurance underwriting purposes

Answer

Government licensing determination

Question 4

Under the FCRA, obtaining a consumer report under false pretenses exposes the violator to:

Accepted Answer

Civil liability and potential criminal prosecution

Answer

Only an FTC warning letter

Answer

Administrative sanctions only

Answer

No liability if the report is never actually used

Question 5

Which permissible purpose specifically requires written authorization from the consumer before a report may be procured?

Accepted Answer

Employment purposes

Answer

Credit account review by an existing creditor

Answer

Insurance underwriting

Answer

Court-ordered access pursuant to a subpoena

Question 6

A company that assembles and merges consumer report information from multiple CRAs and resells it to end users is classified under the FCRA as a:

Accepted Answer

Consumer reporting agency acting as a reseller

Answer

Data furnisher

Answer

Credit grantor

Answer

Background screening intermediary

Question 7

Which FCRA provision authorizes a government agency to obtain a consumer report for determining eligibility for a government-granted license?

Accepted Answer

Section 604(a)(3)(D) — government licensing and benefit eligibility

Answer

General law enforcement authority under Section 604(a)(1)

Answer

Section 604(a)(3)(A) — credit transactions

Answer

No specific authority; government agencies are exempt