Bill on Credit Reporting
I would like to clarify a few points and correct some errors made in your editorial (Aug. 9) regarding credit reporting.
We support HR 3596, the Consumer Reporting Reform Act of 1992, as reported out of the House Banking Committee and currently pending before Congress. It contains over 40 provisions that would benefit consumers. However, it also provides for preemption of state credit reporting laws existent or pending in 21 states.
We favor preemption for one simple reason. Credit reporting is an interstate business, and it makes much more sense to regulate such a business at the federal level than through 50 different and conflicting state laws.
Your comment that state laws “provide greater consumer protection” and that “20 states, including California, have laws that set stricter standards on credit reporting” than HR 3596 is wrong. No state bill currently on the books contains more than a few of the 45 consumer protection provisions of HR 3596. For instance, only two states require that consumers be notified if an employment report is done on them. Only one state has a provision for toll-free numbers. Only one state allows a consumer to file suit against someone who illegally obtains a copy of his or her credit report. No state requires all three credit reporting systems to provide the consumer a free report if he or she is denied credit. No state requires child support payments to be included in a credit report. Taken in the aggregate, all 21 state laws contain less than a quarter of the consumer protection provisions of HR 3596.
The federal legislation you refer to does not contain a free report provision as you state. It caps the price at $8. Incidentally, only three states offer reports at less than $8, another instance where HR 3596 is superior to state law.
I’d like to point out two other errors you made. First, all three credit reporting systems have toll-free numbers as opposed to your statement that only two have such numbers. Also, the current industry practice is for all correspondence to be answered within 30 days, which, in the overwhelming majority of the cases, is accomplished.
NORMAN MAGNUSON
Director of Public Affairs
Associated Credit Bureaus, Washington
