FCRA Permissible Purpose & End-User Requirements 3

Question 1

For willful noncompliance with the FCRA, a consumer may recover which of the following under Section 616?

Accepted Answer

Actual or statutory damages ($100-$1,000) plus punitive damages and attorney fees

Answer

Only actual damages up to $1,000

Answer

Statutory damages of $5,000 per violation only

Answer

Only injunctive relief with no monetary damages

Question 2

An insurance company seeking to underwrite a new policy may access a consumer report under which permissible purpose?

Accepted Answer

Insurance underwriting in connection with a transaction initiated by the consumer under Section 604(a)(3)(C)

Answer

Employment screening under Section 604(a)(3)(B)

Answer

Legitimate business need under Section 604(a)(3)(F)

Answer

Any insurance purpose, as insurers have blanket access

Question 3

A company obtains a consumer report for credit underwriting but then uses it to evaluate the consumer for an unrelated marketing campaign. This practice:

Accepted Answer

Violates the FCRA because the report is used for a purpose beyond the one for which it was obtained

Answer

Is permissible if the marketing use is reasonable given the existing relationship

Answer

Is only a violation if the consumer formally objects

Answer

Is allowed because the company already holds a permissible purpose on file

Question 4

Which FCRA section specifically addresses the duties and obligations of users of consumer reports, including adverse action notice requirements?

Accepted Answer

Section 615 — requirements on users of consumer reports

Answer

Section 601 — short title and purpose

Answer

Section 604 — permissible purposes

Answer

Section 619 — obtaining reports under false pretenses

Question 5

When obtaining a consumer report for employment purposes, the FCRA requires that the written disclosure and authorization form:

Accepted Answer

Consist solely of the disclosure in a standalone document separate from other materials

Answer

Be included as part of the employment application to streamline the process

Answer

Be obtained verbally and documented in writing by the employer afterward

Answer

Be filed with the Equal Employment Opportunity Commission before use

Question 6

A consumer reporting agency that knowingly furnishes a consumer report to a user without a permissible purpose is subject to civil liability under which FCRA section?

Accepted Answer

Section 616 — willful noncompliance

Answer

Section 611 — procedure for disputing inaccuracies

Answer

Section 613 — public record information reporting

Answer

Section 621 — administrative enforcement only

Question 7

The FCRA's permissible purpose requirements under Section 604 apply to:

Accepted Answer

All consumer reports as defined under Section 603(d), regardless of type

Answer

Only credit reports obtained by financial institutions

Answer

Only investigative consumer reports due to their heightened sensitivity

Answer

Only reports used for employment screening purposes