To implement recent amendments to the Fair Credit Reporting Act (FCRA), the Consumer Financial Protection Bureau (CFPB) has proposed a rule intended to assist survivors of trafficking. The rule would establish a way for survivors to submit documentation to consumer reporting agencies (CRAs) identifying any “adverse item of information” about the consumer resulting from human trafficking, and would prohibit CRAs from furnishing consumer reports containing such information. Comments on the rule must be submitted by May 9, 2022.
The threshold issue the CFPB seeks to address in the rule is what documentation submitted by a survivor of trafficking would constitute “trafficking documentation” for purposes of triggering a CRA’s obligation to block adverse information. The CFPB is proposing that such documentation include either (1) documents containing a determination by a Federal, State, or Tribal government entity, or a court of competent jurisdiction, that a consumer is a victim of trafficking, or (2) documents filed in a court of competent jurisdiction indicating that a consumer is a victim of trafficking. The CFPB states that it “may consider issuing interpretations in the future that provide specific examples to provide clarity on the types of ‘determinations’ that establish a consumer is a ‘victim of trafficking.’”
The Bureau has not proposed to prescribe what constitutes “an adverse item of information” that must be blocked after a consumer provides a CRA with trafficking documentation. Its rationale for this approach is that what constitutes such information “may vary depending on the weight of each individual user of a consumer report gives to certain items of information as well as the consumer’s individual circumstances.” The CFPB however gives the following examples of information that could be excluded from a credit report: “records containing derogatory information, such as payment delinquencies or defaults, reported to a consumer reporting agency on a loan or large purchase, records of coerced debt where a loan is taken out by a trafficking victim under force or threat, records of criminal arrests and convictions, and records of evictions or non-payment of rent.”