§ 1681b. Permissible purposes of consumer reports
(a)
In general
Subject to subsection (c) of this section, any consumer reporting agency may furnish a consumer report under the following circumstances and no other:
(1)
In response to the order of a court having jurisdiction to issue such an order, or a subpoena issued in connection with proceedings before a Federal grand jury.
(3)
To a person which it has reason to believe—
(A)
intends to use the information in connection with a credit transaction involving the consumer on whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; or
(C)
intends to use the information in connection with the underwriting of insurance involving the consumer; or
(D)
intends to use the information in connection with a determination of the consumer’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider an applicant’s financial responsibility or status; or
(E)
intends to use the information, as a potential investor or servicer, or current insurer, in connection with a valuation of, or an assessment of the credit or prepayment risks associated with, an existing credit obligation; or
(4)
In response to a request by the head of a State or local child support enforcement agency (or a State or local government official authorized by the head of such an agency), if the person making the request certifies to the consumer reporting agency that—
(A)
the consumer report is needed for the purpose of establishing an individual’s capacity to make child support payments or determining the appropriate level of such payments;
(B)
the paternity of the consumer for the child to which the obligation relates has been established or acknowledged by the consumer in accordance with State laws under which the obligation arises (if required by those laws);
(5)
To an agency administering a State plan under section
654 of title
42 for use to set an initial or modified child support award.
(6)
To the Federal Deposit Insurance Corporation or the National Credit Union Administration as part of its preparation for its appointment or as part of its exercise of powers, as conservator, receiver, or liquidating agent for an insured depository institution or insured credit union under the Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.] or the Federal Credit Union Act [12 U.S.C. 1751 et seq.], or other applicable Federal or State law, or in connection with the resolution or liquidation of a failed or failing insured depository institution or insured credit union, as applicable.
(b)
Conditions for furnishing and using consumer reports for employment purposes
(1)
Certification from user
A consumer reporting agency may furnish a consumer report for employment purposes only if—
(2)
Disclosure to consumer
(A)
In general
Except as provided in subparagraph (B), a person may not procure a consumer report, or cause a consumer report to be procured, for employment purposes with respect to any consumer, unless—
(B)
Application by mail, telephone, computer, or other similar means
If a consumer described in subparagraph (C) applies for employment by mail, telephone, computer, or other similar means, at any time before a consumer report is procured or caused to be procured in connection with that application—
(i)
the person who procures the consumer report on the consumer for employment purposes shall provide to the consumer, by oral, written, or electronic means, notice that a consumer report may be obtained for employment purposes, and a summary of the consumer’s rights under section
1681m
(a)(3) of this title; and
(C)
Scope
Subparagraph (B) shall apply to a person procuring a consumer report on a consumer in connection with the consumer’s application for employment only if—
(3)
Conditions on use for adverse actions
(A)
In general
Except as provided in subparagraph (B), in using a consumer report for employment purposes, before taking any adverse action based in whole or in part on the report, the person intending to take such adverse action shall provide to the consumer to whom the report relates—
(B)
Application by mail, telephone, computer, or other similar means
(i)
If a consumer described in subparagraph (C) applies for employment by mail, telephone, computer, or other similar means, and if a person who has procured a consumer report on the consumer for employment purposes takes adverse action on the employment application based in whole or in part on the report, then the person must provide to the consumer to whom the report relates, in lieu of the notices required under subparagraph (A) of this section and under section
1681m
(a) of this title, within 3 business days of taking such action, an oral, written or electronic notification—
(I)
that adverse action has been taken based in whole or in part on a consumer report received from a consumer reporting agency;
(II)
of the name, address and telephone number of the consumer reporting agency that furnished the consumer report (including a toll-free telephone number established by the agency if the agency compiles and maintains files on consumers on a nationwide basis);
(ii)
If, under clause (B)(i)(IV), the consumer requests a copy of a consumer report from the person who procured the report, then, within 3 business days of receiving the consumer’s request, together with proper identification, the person must send or provide to the consumer a copy of a report and a copy of the consumer’s rights as prescribed by the Federal Trade Commission under section
1681g
(c)(3) [1] of this title.
(C)
Scope
Subparagraph (B) shall apply to a person procuring a consumer report on a consumer in connection with the consumer’s application for employment only if—
(4)
Exception for national security investigations
(A)
In general
In the case of an agency or department of the United States Government which seeks to obtain and use a consumer report for employment purposes, paragraph (3) shall not apply to any adverse action by such agency or department which is based in part on such consumer report, if the head of such agency or department makes a written finding that—
(i)
the consumer report is relevant to a national security investigation of such agency or department;
(B)
Notification of consumer upon conclusion of investigation
Upon the conclusion of a national security investigation described in subparagraph (A), or upon the determination that the exception under subparagraph (A) is no longer required for the reasons set forth in such subparagraph, the official exercising the authority in such subparagraph shall provide to the consumer who is the subject of the consumer report with regard to which such finding was made—
(C)
Delegation by head of agency or department
For purposes of subparagraphs (A) and (B), the head of any agency or department of the United States Government may delegate his or her authorities under this paragraph to an official of such agency or department who has personnel security responsibilities and is a member of the Senior Executive Service or equivalent civilian or military rank.
(D)
Definitions
For purposes of this paragraph, the following definitions shall apply:
(i)
Classified information
The term “classified information” means information that is protected from unauthorized disclosure under Executive Order No. 12958 or successor orders.
(ii)
National security investigation
The term “national security investigation” means any official inquiry by an agency or department of the United States Government to determine the eligibility of a consumer to receive access or continued access to classified information or to determine whether classified information has been lost or compromised.
(c)
Furnishing reports in connection with credit or insurance transactions that are not initiated by consumer
(1)
In general
A consumer reporting agency may furnish a consumer report relating to any consumer pursuant to subparagraph (A) or (C) of subsection (a)(3) of this section in connection with any credit or insurance transaction that is not initiated by the consumer only if—
(e)
Election of consumer to be excluded from lists
(1)
In general
A consumer may elect to have the consumer’s name and address excluded from any list provided by a consumer reporting agency under subsection (c)(1)(B) of this section in connection with a credit or insurance transaction that is not initiated by the consumer, by notifying the agency in accordance with paragraph (2) that the consumer does not consent to any use of a consumer report relating to the consumer in connection with any credit or insurance transaction that is not initiated by the consumer.
(3)
Response of agency after notification through system
Upon receipt of notification of the election of a consumer under paragraph (1) through the notification system maintained by the agency under paragraph (5), a consumer reporting agency shall—
(A)
inform the consumer that the election is effective only for the 5-year period following the election if the consumer does not submit to the agency a signed notice of election form issued by the agency for purposes of paragraph (2)(B); and
(B)
provide to the consumer a notice of election form, if requested by the consumer, not later than 5 business days after receipt of the notification of the election through the system established under paragraph (5), in the case of a request made at the time the consumer provides notification through the system.
(4)
Effectiveness of election
An election of a consumer under paragraph (1)—
(A)
shall be effective with respect to a consumer reporting agency beginning 5 business days after the date on which the consumer notifies the agency in accordance with paragraph (2);
(B)
shall be effective with respect to a consumer reporting agency—
(5)
Notification system
(A)
In general
Each consumer reporting agency that, under subsection (c)(1)(B) of this section, furnishes a consumer report in connection with a credit or insurance transaction that is not initiated by a consumer, shall—
(i)
establish and maintain a notification system, including a toll-free telephone number, which permits any consumer whose consumer report is maintained by the agency to notify the agency, with appropriate identification, of the consumer’s election to have the consumer’s name and address excluded from any such list of names and addresses provided by the agency for such a transaction; and
(ii)
publish by not later than 365 days after September 30, 1996, and not less than annually thereafter, in a publication of general circulation in the area served by the agency—
(B)
Establishment and maintenance as compliance
Establishment and maintenance of a notification system (including a toll-free telephone number) and publication by a consumer reporting agency on the agency’s own behalf and on behalf of any of its affiliates in accordance with this paragraph is deemed to be compliance with this paragraph by each of those affiliates.
(f)
Certain use or obtaining of information prohibited
A person shall not use or obtain a consumer report for any purpose unless—
(1)
the consumer report is obtained for a purpose for which the consumer report is authorized to be furnished under this section; and
(2)
the purpose is certified in accordance with section
1681e of this title by a prospective user of the report through a general or specific certification.
(g)
Protection of medical information
(1)
Limitation on consumer reporting agencies
A consumer reporting agency shall not furnish for employment purposes, or in connection with a credit or insurance transaction, a consumer report that contains medical information (other than medical contact information treated in the manner required under section
1681c
(a)(6) of this title) about a consumer, unless—
(A)
if furnished in connection with an insurance transaction, the consumer affirmatively consents to the furnishing of the report;
(B)
if furnished for employment purposes or in connection with a credit transaction—
(C)
the information to be furnished pertains solely to transactions, accounts, or balances relating to debts arising from the receipt of medical services, products, or devises, where such information, other than account status or amounts, is restricted or reported using codes that do not identify, or do not provide information sufficient to infer, the specific provider or the nature of such services, products, or devices, as provided in section
1681c
(a)(6) of this title.
(2)
Limitation on creditors
Except as permitted pursuant to paragraph (3)(C) or regulations prescribed under paragraph (5)(A), a creditor shall not obtain or use medical information (other than medical information treated in the manner required under section
1681c
(a)(6) of this title) pertaining to a consumer in connection with any determination of the consumer’s eligibility, or continued eligibility, for credit.
(3)
Actions authorized by Federal law, insurance activities and regulatory determinations
Section
1681a
(d)(3) of this title shall not be construed so as to treat information or any communication of information as a consumer report if the information or communication is disclosed—
(A)
in connection with the business of insurance or annuities, including the activities described in section 18B of the model Privacy of Consumer Financial and Health Information Regulation issued by the National Association of Insurance Commissioners (as in effect on January 1, 2003);
(B)
for any purpose permitted without authorization under the Standards for Individually Identifiable Health Information promulgated by the Department of Health and Human Services pursuant to the Health Insurance Portability and Accountability Act of 1996, or referred to under section 1179 of such Act,[2] or described in section
6802
(e) of this title; or
(C)
as otherwise determined to be necessary and appropriate, by regulation or order and subject to paragraph (6), by the Commission, any Federal banking agency or the National Credit Union Administration (with respect to any financial institution subject to the jurisdiction of such agency or Administration under paragraph (1), (2), or (3) of section
1681s
(b) of this title,[3] or the applicable State insurance authority (with respect to any person engaged in providing insurance or annuities).
(4)
Limitation on redisclosure of medical information
Any person that receives medical information pursuant to paragraph (1) or (3) shall not disclose such information to any other person, except as necessary to carry out the purpose for which the information was initially disclosed, or as otherwise permitted by statute, regulation, or order.
(5)
Regulations and effective date for paragraph (2)
(A)
Regulations required
Each Federal banking agency and the National Credit Union Administration shall, subject to paragraph (6) and after notice and opportunity for comment, prescribe regulations that permit transactions under paragraph (2) that are determined to be necessary and appropriate to protect legitimate operational, transactional, risk, consumer, and other needs (and which shall include permitting actions necessary for administrative verification purposes), consistent with the intent of paragraph (2) to restrict the use of medical information for inappropriate purposes.
[1] See References in Text note below.
[2] See References in Text note below.
[3] So in original. A closing parenthesis probably should precede the comma.