Adverse Action Notices & Credit Score Disclosures

In our June 2011 newsletter, we reminded you about some pending regulatory changes that could take effect on July 21, 2011.  This is also the date that the Consumer Financial Protection Bureau (CFPB) takes over rulemaking authority for consumer compliance.  One of the mentioned changes were amendments to Regulation B and its model forms to incorporate the adverse action notice provisions required by the Dodd-Frank amendments to the Fair Credit Reporting Act.  These amendments will require creditors to disclose the credit score used to taking adverse action and other information relating to the credit score.  A proposal was issued in March 2011, and as of yet no final rule has been issued.

While the effective date stated in the proposal is July 21, 2011, we have seen several other proposals which have been delayed and some that will go into effect without a final rule.  So, we have been searching for clarity as to what the expected effective date will actually be.  We learned today that July 21, 2011, will be the required compliance date.  Since there is no final rule, you should use the proposed rule as your guide.

We will provide an update shortly to assist you in your compliance efforts.  Stay tuned.


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