Agencies issue FACT Act interim final rules on medical information.The federal bank, thrift institution, and credit union regulatory agencies issued on June 6, 2005, interim final rules under the Fair Credit Reporting Act The Fair Credit Reporting Act (FCRA) is legislation embodied in title VI of the Consumer Credit Protection Act (15 U.S.C.A. § 1681 et seq. [1968]), which was enacted by Congress in 1970 to ensure that reporting activities relating to various consumer transactions are conducted in a (FCRA FCRA Fair Credit Reporting Act (US) FCRA Foreign Contribution Regulation Act FCRA Federal Credit Reform Act FCRA Florida Civil Rights Act FCRA Florida Court Reporters Association FCRA Fabric Care Research Association ) that create exceptions to the statutory prohibition against obtaining or using medical information in connection with credit eligibility determinations. The interim final rules also address the sharing of medically related information among affiliates. The effective date for these rules is nine months after the date of publication in the Federal Register, which was on June 10, 2005. Section 411 of the Fair and Accurate Credit Transactions Act Under the Fair and Accurate Credit Transactions Act of 2003 (FACT Act or FACTA, Pub.L. 108-159) which was passed by the United States Congress on December 4 2003 as an amendment to the Fair Credit Reporting Act, consumers can request and obtain a free credit report of 2003 (FACT Act) amended the FCRA to provide that a creditor may not obtain or use medical information in connection with any determination of a consumer's eligibility, or continued eligibility, for credit except as permitted by regulations or the FACT Act. However, the FACT Act also requires the agencies to prescribe regulations that permit creditors to obtain and use medical information for credit eligibility purposes when necessary and appropriate to protect legitimate operational, transactional, risk, consumer, and other needs. A proposed rule was published for comment on April 28, 2004. The interim final rules create exceptions to the general statutory prohibition on obtaining and using medical information. The provisions are similar to those contained in the proposed rule and include exceptions for the use of medical information that is also financial information typically considered in credit underwriting. As authorized by the FACT Act, the agencies have expanded the scope of the rules so that the exceptions will apply to all creditors, not just to creditors ordinarily regulated by one of the agencies. Section 411 of the FACT Act also amended the FCRA to limit the ability of creditors and others to share medically related information among affiliates except as permitted by the statute, regulation, or order. The interim final rules specify the circumstances in which creditors may share medically related information among affiliates without becoming consumer reporting agencies. The interim final rules are being issued by the Board of Governors of the Federal Reserve System Board of Governors of the Federal Reserve System The managing body of the Federal Reserve System, which sets policies on bank practices and the money supply. , the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. , the National Credit Union Administration The National Credit Union Administration (NCUA) is responsible for chartering, insuring, supervising, and examining federal credit unions (FCUs) and for administering the National Credit Union Share Insurance Fund. , the Office of the Comptroller of the Currency The Office of the Comptroller of the Currency (or OCC) was established by the National Currency Act of 1863 and serves to charter, regulate, and supervise all national banks and the federal branches and agencies of foreign banks in the United States. , and the Office of Thrift Supervision The Office of Thrift Supervision (OTS) was established as a bureau of the Treasury Department in August 1989 as part of a major Reorganization Plan of the thrift regulatory structure mandated by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) (12 U.S.C.A. . The rules of each agency are substantively identical. The rules are being issued as interim final rules to allow for public comment on their expanded scope. The agencies requested comment within thirty days after publication in the Federal Register. |
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