Entities with a legitimate interest can access an individual’s credit report and score, but the Fair Credit Reporting Act (FCRA) regulates the reasons entities that may access this information and what they may do with it. Those who fraudulently access the information or otherwise use it in a manner contrary to the authorized uses outlined within the FCRA can face both civil and criminal penalties for their actions.
Banks and other lending institutions may pull an individuals credit report and score to determine their level of debt, payment history, and overall creditworthiness. The same is true for creditors such as credit card companies. Other authorized entities include utility providers, insurance companies, landlords, collection agencies, government entities and employers. In certain circumstances, entities that otherwise would not have access to an individual’s credit report and/or score may request an exception via a court order if they can establish a legitimate reason for needing that information.
Legitimate reasons covered under the FCRA include the extension of credit, the renting of property, loan approvals, obtaining contact information, the underwriting of insurance policies, and the collection of past due debts. A credit report may be requested as part of the process for granting employment or a security clearance for a government entity such as the Department of Defense. However, when an employer or prospective employer requests access, they may only receive the information after they receive written consent from the individual.
Denial of Credit, Employment & Adverse Actions
If an entity denies an individual a loan, credit account, or employment, they are required to state their reasons for the decision. In the case of employment, they are required to provide an adverse action report that identifies an individual’s credit history as the reason for the decision.
Friends, relatives, colleagues, prospective business partners, and random strangers cannot legitimately access an individual’s credit report and credit score. Information within a credit report cannot be distributed or posted to a website without the individual’s consent. Those who fraudulently obtain access to a credit report can face civil penalties of up to $1000 or the actual damages suffered by the plaintiff, whichever may be greater.