Credit Bureau Associates

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IN THE MATTER OF CREDIT BUREAU ASSOCIATES, ET AL.

CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND FAIR CREDIT REPORTING ACTS Docket C-2986. Complaint, Nov. 9, 1978 — Decision, Nov. 9, 1978 This order, among other things, requires a Camden, N.J. credit reporting firm and its partners to cease failing to provide properly identified consumers with requested file information; reinvestigate disputed information; incorporate current findings in consumer files; and promptly advise such consumers of the results of the reinvestigation, without charge. Additionally, the order prohibits the firms from using consumers’ phone numbers for debt collection purposes; and requires them to maintain, for a prescribed period, records regarding the manner and form of their compliance with the terms of the order.

Appearances For the Commission: Shirley F. Norris.

For the respondents: Richard D. Demon, Capehart & Scatchard, Camden, N.J.

COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act, as amended, and of the Fair Credit Reporting Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that the parties named in the caption hereof, hereinafter sometimes referred to as respondents, have violated the provisions of said Acts, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH: 1. For the purposes of this complaint and the accompanying order to cease and desist, “consumer report,” “consumer reporting agency” and “file” are defined as set forth in Sections 603(d), 603(f) and 603(g), respectively, of the Fair Credit Reporting Act.

Par. 2. Respondent Credit Bureau Associates is a partnership existing and doing business under and by virtue of the laws of the State of New Jersey, with its trade name registered in Camden County, New Jersey, and its principal office and place of business Complaint 92 F.T.C.

located at 817 Carpenter St., Camden, New Jersey. Said respondent is a “consumer reporting agency.”

Respondent Camden Credit Association is a corporation organized, existing and doing business under and by virtue of the laws of the State of New Jersey, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey. Said respondent is a partner in Credit Bureau Associates and is a “consumer reporting agency.”

Respondent Credit Information Center, Inc., d/b/a Credit Information Center of West Chester, is a corporation organized, existing and doing business under and by virtue of the laws of the Commonwealth of Pennsylvania, with its principal office and place of business located at 1154 West Chester Pike, West Chester, Pennsylvania. Said . respondent is a partner in Credit Bureau Associates and is a “consumer reporting agency.”

Respondent Norristown Credit Bureau, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the Commonwealth of Pennsylvania, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey. Said respondent is a partner in Credit Bureau Associates and is a “consumer reporting agency.”

Respondent Suburban Credit Bureau, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of New Jersey, with its principal office and place of | business located at 817 Carpenter St., Camden, New Jersey. Said respondent is a partner in Credit Bureau Associates and is a. “consumer reporting agency.”

Respondent Charles W. Swan, Jr. is an individual and an officer of Camden Credit Association. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is the same as that of said corporation. Respondent George C. Whittam is an individual and an officer of Credit Information Center, Inc. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is 1154 West Chester Pike, West Chester, Pennsylvania. :

Respondent Bernard S. Becker is an individual and an officer of Norristown Credit Bureau, Inc. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is the same as that of said corporation. Respondents Woodrow W. French and John J. Lamplugh are individuals and officers of Suburban Credit Bureau, Inc. In said capacity they are responsible for that corporation’s activities as a CREDIT BUREAU ASSOCIATES, ET AL. 839 837 Complaint partner in Credit Bureau Associates. Their business address is the same as that of said corporation.

Respondents Camden Credit Association, Credit Information Center, Inc., Norristown Credit Bureau, Inc., Suburban Credit Bureau, Inc., Charles W. Swan, Jr., George C. Whittam, Bernard S. Becker, Woodrow W. French and John J. Lamplugh thus formulate, direct and control the policies, acts and practices of respondent Credit Bureau Associates, including those hereinafter set forth. Par. 8. All the acts and practices alleged herein took place and are taking place in the ordinary course of respondents’ business and occurred subsequent to April 25, 1971, the effective date of the Fair Credit Reporting Act.

Par. 4. In the regular course and conduct of their business, respondents engage in the practice of assembling or evaluating _ consumer credit information or other information on consumers for the purpose of furnishing consumer reports for use by others in making a decision concerning whether to grant credit, underwrite insurance or employ the subject of such report. Par. 5. Respondents, in certain instances, fail, upon request and proper identification of the consumer, to clearly and accurately disclose to the consumer the nature and substance of all information (except medical information) in the file on the consumer at the time of the request.

Therefore, respondents are in violation of Section 609(a)(1) of the Fair Credit Reporting Act.

Par. 6. When the completeness or accuracy of an item of information in his or her file is disputed by a consumer, respondents fail in certain instances to:

(a) Reinvestigate the disputed information within a reasonable period of time;

(b) Record, after reinvestigation, the current status of information disputed by the consumer; and (c) Promptly delete information which is found to be inaccurate or not verifiable after reinvestigation.

Therefore, respondents are in violation of Section 611(a) of the Fair Credit Reporting Act.

Par. 7. After reinvestigation of disputed items of information in the file on the consumer, in certain instances where there were no reasonable grounds to believe that the dispute was frivolous or irrelevant, the respondents retained the disputed items in subsequent consumer reports by failing to delete said information, failing to clearly note the existence of a dispute and failing to enclose a brief | Decision and Order 92 F.T.C.

statement of the consumer’s version of the dispute or an accurate summary thereof.

Therefore, respondents are in violation of Section 611(c) of the Fair Credit Reporting Act.

Par. 8. In the course and conduct of their business, in certain instances, respondents have failed to provide disclosure of information without charge to consumers who contact respondents within thirty days of the consumer being notified by a user of consumer reports that credit has been denied based wholly or in part on the basis of a consumer report issued by respondents. Therefore, respondents are in violation of Section 612 of the Fair Credit Reporting Act.

Par. 9. In the course and conduct of their business, when consumers have appeared in person at respondents’ place of business and have requested disclosure of information in the file relating to the consumer, as a condition precedent to the disclosure, respondents have demanded that the consumer reveal information in excess of that information necessary for proper identification of the consumer. Typical and illustrative of the excessive demands for information are (1) demand for five (5) years of previous address history, (2) demand for home telephone numbers and other telephone numbers, and (8) demand for disclosure of previous employment. Therefore, respondents have violated Section 610(b)(1) of the Fair Credit Reporting Act by placing onerous and excessive requirements on the right of consumer disclosure.

Par. 10. The acts, practices and omissions set forth in Paragraphs Five through Nine herein are in violation of the Fair Credit Reporting Act and, pursuant to Section 621(a) of that Act, respondents have thereby violated Section 5(a) of the Federal Trade Commission Act, as amended.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption hereof, and the respondents having been furnished thereafter with a copy of a draft of complaint which the New York Regional Office proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondents with violation of the Fair Credit Reporting Act and the Federal Trade Commission Act, as amended, and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondents of all the jurisdictional facts set forth in the 837 Decision and Order aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission’s Rules; and, The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Acts, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty (60) days, now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Credit Bureau Associates is a partnership existing and doing business under and by virtue of the laws of the State of New Jersey, with its trade name registered in Camden County, New Jersey, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey.

Respondent Camden Credit Association is a corporation organized, existing and doing business under and by virtue of the laws of the State of New Jersey, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey. Camden Credit Association is a partner in Credit Bureau Associates. Respondent Credit Information Center, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the Commonwealth of Pennsylvania, with its principal office and place of business located at 1154 West Chester Pike, West Chester, Pennsylvania. Said corporation does business under the name Credit Information Center of West Chester. Credit Information Center, Inc. is a partner in Credit Bureau Associates. Respondent Norristown Credit Bureau, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the Commonwealth of Pennsylvania, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey. Norristown Credit Bureau, Inc. is a partner in Credit Bureau Associates.

Respondent Suburban Credit Bureau, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of New Jersey, with its principal office and place of business located at 817 Carpenter St., Camden, New Jersey. Suburban Credit Bureau, Inc. is a partner in Credit Bureau Associates.

277-685 O—79——-54 Decision and Order 92 F.T.C.

Respondent Charles W. Swan, Jr. is an individual and an officer of Camden Credit Association. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is the same as that of said corporation. Respondent George C. Whittam is an individual and an officer of Credit Information Center, Inc. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is 1154 West Chester Pike, West Chester, Pennsylvania.

Respondent Bernard S. Becker is an individual and an officer of Norristown Credit Bureau, Inc. In said capacity he is responsible for that corporation’s activities as a partner in Credit Bureau Associates. His business address is the same as that of said corporation. Respondents Woodrow W. French and John J. Lamplugh are individuals and officers of Suburban Credit Bureau, Inc. In said capacity they are responsible for that corporation’s activities as a partner in Credit Bureau Associates. Their business address is the same as that of said corporation.

Respondents Camden Credit Association, Credit Information Center, Inc., Norristown Credit Bureau, Inc., Suburban Credit Bureau, Inc., Charles W. Swan, Jr., George C. Whittam, Bernard S. Becker, Woodrow W. French and John J. Lamplugh thus formulate, direct and control the policies, acts and practices of respondent — Credit Bureau Associates.

2. The Federal Trade Commission has jurisdiction over the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

ORDER It is ordered, That respondent Credit Bureau Associates, a partnership; and Camden Credit Association, Credit Information Center, Inc., Norristown Credit Bureau, Inc. and Suburban Credit Bureau, Inc., corporations, and partners in Credit Bureau Associates, and their successors and assigns, and their officers; and Charles W. Swan, Jr., George C. Whittam, Bernard S. Becker, Woodrow W. French and John J. Lamplugh, individually and as the officers of the corporate partners of Credit Bureau Associates responsible for the operations of said partnership; and respondents’ agents, representatives, employees, directly or through any corporation, subsidiary, division or any other device, in connection with the collecting, assembling, evaluating or furnishing of consumer reports, as “consumer report” is defined in Section 603(d) of the Fair Credit URBUVIL BUNBAU ADSDUUIALES, Bl AL. 545 837 Decision and Order Reporting Act (15 U.S.C. 1681, et seg.) do forthwith cease and desist from:

1. Failing to disclose promptly by telephone, mail or in person, upon request and proper identification of the consumer, clearly and accurately, the nature and substance of all information (except medical information) in the file on the consumer at the time of the request.

2. Failing, when the completeness or accuracy of an item of information in the file is disputed by the consumer, unless there are reasonable grounds to believe that the dispute is frivolous or irrelevant, to (a) reinvestigate the disputed information within a reasonable period of time; (b) record, after reinvestigation, the current status of information disputed by the consumer; (c) promptly delete information which is found to be inaccurate or not verifiable after the reinvestigation; and (d) promptly include the consumer’s statement of dispute if the controversy is not resolved. 3. Failing, whenever a statement of dispute has been filed, unless there are reasonable grounds to believe that the dispute is frivolous or irrelevant, to clearly note in any subsequent consumer report containing the information in question that it is disputed by the consumer, and to provide either the consumer’s statement of dispute or aclear and accurate summary thereof.

4. Failing, when the consumer is granted by the Fair Credit Reporting Act the right to receive disclosure of the information in the file pertaining to that consumer without charge, to provide such information disclosure without charge.

5. Failing, when respondents reinvestigate disputed items of information, to promptly inform the consumer of the results of such reinvestigation.

6. Failing, where the consumer’s file contains codes, symbols or any abbreviations, to deliver a copy of the key to such codes, symbols or abbreviations to the consumer.

It is further ordered, That, where respondents obtain telephone numbers from consumers, respondents shall not use such telephone numbers for any debt collection activity. It is further ordered, That respondents shall, at all times, subsequent to the effective date of this order, maintain complete business records about the manner and form of their compliance with this order during the immediately preceeding two year period. Such records shall include logs, journals, or other compilations of all correspondence with consumers and consumer report applicants or subscribers, policy directives, interview reports, complaints from consumers and consumer report applicants or subscribers, and other Decision and Order 92 F.T.C.

pertinent documents. Such records shall be kept separate from the consumer files and shall be made available for inspection and photocopying by any authorized representative of the Federal Trade Commission upon reasonable notice at respondents’ place of business or other properly designated location.

It is further ordered, That respondents deliver a copy of this order to cease and desist to all employees now or hereafter engaged in the collecting, assembling, evaluating or furnishing of consumer information to third parties and that respondents secure a signed statement acknowledging receipt of said order from each such person.

It is further ordered, That respondents notify the Commission at least thirty (80) days prior to any proposed change in the corporate respondents or in the partnership entity, such as dissolution, assignment or sale resulting in the emergence of a successor corporation or partnership, the creation or dissolution of subsidiaries or any other change in the legal entities which may affect compliance obligations arising out of this order. It is further ordered, That each individual respondent named herein promptly notify the Commission of the discontinuance of his present business or employment as described in this order and of his new affiliation with a new consumer reporting business or employment by a consumer reporting agency. In addition, for a period of ten years from the effective date of this order, each individual respondent shall promptly notify the Commission of each affiliation with a new consumer reporting business or employment by a consumer reporting agency. Each such notice shall include the individual respondent’s new business address and a statement of the nature of said business or employment in which he is newly engaged as well as a description of his duties and responsibilities in connection with said business or employment. The expiration of the notice provision of this paragraph shall not affect any other obligations arising under this order.

It is further ordered, That the respondents herein shall within sixty (60) days after service upon them of this order, file with the Commission a report in writing, setting forth in detail the manner and form in which they have complied with this order. It is- further ordered, That no provision of this order shall be construed in any way to annul, invalidate, repeal, terminate, modify or exempt respondents from complying with agreements, orders, or directives of any kind obtained by any other agency or act as a defense to actions instituted by municipal or state regulatory agencies. No provision of this order shall be construed to imply that ~ 8387 Decision and Order any past or future conduct of respondents complies with the rules or regulations of, or the statutes administered by the Federal Trade Commission.

Interlocutory Order 92 F.T.C.