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

CRAs are obligated under Section 607(a) to maintain reasonable procedures to limit the furnishing of reports to users with a Section 604 permissible purpose.

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

Personal curiosity has no legitimate business nexus and is not listed as a permissible purpose anywhere in Section 604.

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)(A) covers credit transactions, including both the extension of new credit and the review or collection of existing credit accounts.

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

Permissible purpose is user-specific; each entity that receives or uses a consumer report must independently have a permissible purpose under Section 604.

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

Section 606 imposes heightened disclosure obligations for investigative consumer reports, which are compiled through personal interviews about the consumer's character, general reputation, and personal characteristics.

(FCRA) Advanced Fair Credit Reporting Act Certification Practice Test

(FCRA) Advanced Fair Credit Reporting Act Certification Practice Test

FCRA Permissible Purpose & End-User Requirements 2