Do You Know About Fair Credit Reporting Act? Trivia Quiz

1. Any person who knowingly obtains information on a consumer from a consumer reporting agency under false pretenses shall be fined, imprisoned for no more than 2 years, or both.

True

False

This statement is true. It states that any person who intentionally acquires information about a consumer from a consumer reporting agency using deceptive tactics will be subject to a fine, imprisonment for a maximum of 2 years, or both. This is meant to discourage individuals from obtaining personal information through fraudulent means and to protect consumers' privacy and security.

Explanation

This statement is true. It states that any person who intentionally acquires information about a consumer from a consumer reporting agency using deceptive tactics will be subject to a fine, imprisonment for a maximum of 2 years, or both. This is meant to discourage individuals from obtaining personal information through fraudulent means and to protect consumers' privacy and security.

2. A "consumer report" is any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness.

True

False

The given statement is true. A "consumer report" refers to any form of communication by a consumer reporting agency that contains information about a consumer's creditworthiness. This can include written, oral, or other types of communication.

Explanation

The given statement is true. A "consumer report" refers to any form of communication by a consumer reporting agency that contains information about a consumer's creditworthiness. This can include written, oral, or other types of communication.

3. It is acceptable for a person to furnish inaccurate consumer information to a consumer reporting agency.

True

False

Furnishing inaccurate consumer information to a consumer reporting agency is not acceptable. Consumer reporting agencies rely on accurate information to provide credit reports and make informed decisions about individuals' creditworthiness. Providing inaccurate information can lead to incorrect credit reports and potentially harm individuals' credit scores. It is important to provide truthful and accurate information to consumer reporting agencies.

Explanation

Furnishing inaccurate consumer information to a consumer reporting agency is not acceptable. Consumer reporting agencies rely on accurate information to provide credit reports and make informed decisions about individuals' creditworthiness. Providing inaccurate information can lead to incorrect credit reports and potentially harm individuals' credit scores. It is important to provide truthful and accurate information to consumer reporting agencies.

4. Who is charged with the enforcement of the FCRA?

Federal Trade Commission

Federal Trust Commission

Future’s Trading Commission

None of the above

The Federal Trade Commission (FTC) is responsible for enforcing the Fair Credit Reporting Act (FCRA). The FCRA is a federal law that regulates the collection, accuracy, and use of consumer credit information. The FTC ensures that consumer reporting agencies, creditors, and other entities comply with the FCRA's provisions, which include protecting consumers' privacy rights and ensuring the accuracy of their credit reports. Therefore, the correct answer is the Federal Trade Commission.

Explanation

The Federal Trade Commission (FTC) is responsible for enforcing the Fair Credit Reporting Act (FCRA). The FCRA is a federal law that regulates the collection, accuracy, and use of consumer credit information. The FTC ensures that consumer reporting agencies, creditors, and other entities comply with the FCRA's provisions, which include protecting consumers' privacy rights and ensuring the accuracy of their credit reports. Therefore, the correct answer is the Federal Trade Commission.

5. The terms "fraud alert" or "active duty alert" mean a statement in the file of a consumer that:

The consumer may be a victim of fraud.

The consumer may be a victim of identity theft.

The consumer is on active duty.

All of the above.

The terms "fraud alert" or "active duty alert" indicate that the consumer may be a victim of fraud, identity theft, or is currently on active duty. Therefore, the correct answer is "All of the above." This means that all three statements are true and are encompassed by the terms "fraud alert" or "active duty alert."

Explanation

The terms "fraud alert" or "active duty alert" indicate that the consumer may be a victim of fraud, identity theft, or is currently on active duty. Therefore, the correct answer is "All of the above." This means that all three statements are true and are encompassed by the terms "fraud alert" or "active duty alert."

6. The banking system is dependent upon fair and accurate credit reporting. Inaccurate credit reports:

Are a normal occurrence.

Allow for the continued functioning of the banking system.

Impair the efficiency of the banking system.

None of the above.

Inaccurate credit reports can have a negative impact on the efficiency of the banking system. Credit reports play a crucial role in assessing the creditworthiness of individuals and businesses, which is essential for making lending decisions. If the credit reports contain inaccuracies, it can lead to wrong evaluations of borrowers' creditworthiness, resulting in incorrect lending decisions. This can lead to increased default rates and financial losses for banks. Additionally, inaccurate credit reports can also affect the overall trust and confidence in the banking system, making it less efficient in matching borrowers with lenders and allocating capital effectively.

Explanation

Inaccurate credit reports can have a negative impact on the efficiency of the banking system. Credit reports play a crucial role in assessing the creditworthiness of individuals and businesses, which is essential for making lending decisions. If the credit reports contain inaccuracies, it can lead to wrong evaluations of borrowers' creditworthiness, resulting in incorrect lending decisions. This can lead to increased default rates and financial losses for banks. Additionally, inaccurate credit reports can also affect the overall trust and confidence in the banking system, making it less efficient in matching borrowers with lenders and allocating capital effectively.

7. A "consumer reporting agency" is:

Used in connection with a consumer report.

An individualized list or description based on the payment transactions ofthe consumer for medical products or services.

Any person which, for monetary fees, dues, or on a nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information for the purpose of furnishing consumer credit reports to third parties.

None of the above.

The correct answer is the definition of a "consumer reporting agency" as a person who regularly engages in assembling or evaluating consumer credit information for the purpose of providing consumer credit reports to third parties. This definition includes individuals or organizations that charge fees or operate on a nonprofit basis. It excludes the other options, which are not directly related to consumer credit reporting.

Explanation

The correct answer is the definition of a "consumer reporting agency" as a person who regularly engages in assembling or evaluating consumer credit information for the purpose of providing consumer credit reports to third parties. This definition includes individuals or organizations that charge fees or operate on a nonprofit basis. It excludes the other options, which are not directly related to consumer credit reporting.

8. Upon the direct request of the consumer who asserts a suspicion that they have been or are about to become a victim of fraud or identity theft, a consumer reporting agency shall:

Include a fraud alert in the consumer’s file for a minimum of 90 days.

Provide a fraud alert in any credit report generated for that consumer filefor a minimum of 90 days.

Refer the information regarding the fraud alert to each of the otherconsumer reporting agencies.

All of the above.

Upon the direct request of the consumer who asserts a suspicion of fraud or identity theft, a consumer reporting agency is required to take several actions. Firstly, they must include a fraud alert in the consumer's file for a minimum of 90 days. Secondly, they must provide a fraud alert in any credit report generated for that consumer file for a minimum of 90 days. Lastly, they must refer the information regarding the fraud alert to each of the other consumer reporting agencies. Therefore, the correct answer is "All of the above."

Explanation

Upon the direct request of the consumer who asserts a suspicion of fraud or identity theft, a consumer reporting agency is required to take several actions. Firstly, they must include a fraud alert in the consumer's file for a minimum of 90 days. Secondly, they must provide a fraud alert in any credit report generated for that consumer file for a minimum of 90 days. Lastly, they must refer the information regarding the fraud alert to each of the other consumer reporting agencies. Therefore, the correct answer is "All of the above."

9. It is permissible for a person to use the consumer report information in connection with the collection of an account.

True

False

A consumer report contains information about an individual's credit history and financial behavior. In certain situations, such as when collecting an account, it is permissible for a person to use this information. This allows them to assess the individual's creditworthiness and make informed decisions regarding the collection process. Therefore, the statement "It is permissible for a person to use the consumer report information in connection with the collection of an account" is true.

Explanation

A consumer report contains information about an individual's credit history and financial behavior. In certain situations, such as when collecting an account, it is permissible for a person to use this information. This allows them to assess the individual's creditworthiness and make informed decisions regarding the collection process. Therefore, the statement "It is permissible for a person to use the consumer report information in connection with the collection of an account" is true.

10. The penalties for willful non-compliance of the FCRA:

Actual damages sustained by the consumer for not less than $100 or more than $1000.

Punitive damages as the court may allow.

The cost of the action together with reasonable attorney’s fees as determined by the court.

All of the above.

The correct answer is "All of the above" because the question asks for the penalties for willful non-compliance of the FCRA. The options listed include the actual damages sustained by the consumer (ranging from $100 to $1000), punitive damages as determined by the court, and the cost of the action along with reasonable attorney's fees as determined by the court. Therefore, all of these options are valid penalties for willful non-compliance of the FCRA.

Explanation

The correct answer is "All of the above" because the question asks for the penalties for willful non-compliance of the FCRA. The options listed include the actual damages sustained by the consumer (ranging from $100 to $1000), punitive damages as determined by the court, and the cost of the action along with reasonable attorney's fees as determined by the court. Therefore, all of these options are valid penalties for willful non-compliance of the FCRA.