FACT Act Update

The Federal Trade Commission has proposed three of seven Fair and Accurate Credit Transactions (FACT) Act rules that could affect automobile dealers, but none of the rules have been finalized yet, according to NADA. These include section 112, pertaining to fraud and active duty alerts; section 214, on marketing to affiliates; and section 216, which discusses the disposal of consumer report information. Additionally, the FTC has requested comments on studies that it is conducting, as required by the FACT Act, that involve consumer report information and the credit process. Under section 217 of the Act, the Federal Reserve Board has finalized a rule creating model notices that financial institutions may use if they voluntarily “furnish” negative information to consumer reporting agencies. Although this rule applies to automobile dealers, it only impacts those who “furnish” such information to these agencies.