FCRA Permissible Purpose & End-User Requirements 2

Question 1

A consumer reporting agency may lawfully furnish a consumer report only to a user it has reason to believe:

Accepted Answer

Has a permissible purpose as enumerated in Section 604

Answer

Works in the financial services industry

Answer

Is a licensed business entity in good standing

Answer

Has obtained the consumer's verbal consent

Question 2

Which of the following is NOT a permissible purpose under FCRA Section 604?

Accepted Answer

A neighbor's personal curiosity about someone's finances

Answer

Collection of a consumer debt

Answer

Insurance underwriting initiated by the consumer

Answer

Access pursuant to a valid court order

Question 3

When a creditor uses a consumer report to review an existing account, this account review purpose falls under which Section 604 provision?

Accepted Answer

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

Answer

Section 604(a)(3)(B) — employment

Answer

Section 604(a)(3)(C) — insurance underwriting

Answer

Section 604(a)(3)(F) — legitimate business need

Question 4

When an end user shares a consumer report with an affiliate, the FCRA requires that:

Accepted Answer

The affiliate must independently have a permissible purpose for receiving the report

Answer

No restrictions apply because affiliates share a permissible purpose by default

Answer

The consumer must be notified within 30 days of the sharing

Answer

A new consumer report must be obtained specifically for the affiliate

Question 5

Which type of consumer report triggers additional disclosure and notice requirements under FCRA Section 606 due to the manner in which information is gathered?

Accepted Answer

Investigative consumer report

Answer

Standard tri-merge credit report

Answer

Employment background screening report

Answer

Tenant screening report

Question 6

A creditor that takes adverse action based wholly or partly on information in a consumer report is obligated under the FCRA to:

Accepted Answer

Provide the consumer with required adverse action notices under Section 615

Answer

Retain the consumer report for a minimum of five years

Answer

Report the adverse action to the FTC within 30 days

Answer

Destroy the consumer report immediately after the decision

Question 7

Under the FCRA, a child support enforcement agency seeking a consumer report for enforcement purposes obtains authority from:

Accepted Answer

Specific child support enforcement provisions within Section 604

Answer

General government administrative authority

Answer

Broad law enforcement provisions applicable to all agencies

Answer

A court order is always required