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Government’s credit card oops

By Janna Herron ·
Wednesday, October 3, 2012
Posted: 4 pm ET

The Supreme Court heard arguments on Tuesday about whether the federal government should be held accountable for violating the Fair Credit Reporting Act, or FCRA. The case highlights a small provision of an act that dictates consumers' rights regarding their credit reports.

A Chicago attorney brought the class-action suit against the U.S. government after the expiration date on his credit card was printed on a receipt from a government website. Under the FCRA, customer receipts can't show the card's expiration date.

Justice Department attorneys said the government has sovereign immunity, even though the FCRA defines the liable person as "any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity."

Seems clear-cut to me, but I admit there's a lot of legal mumbo jumbo here that can complicate things. Still, it's silly for the government to pass an act, then not abide by it itself, especially when it comes to consumer protections.

The Supreme Court is expected to rule on the case within the next 12 months.

The bulk of the FCRA deals with consumer rights with credit reports. For example, did you know that you have the right to know what's in your file, and if your credit report has been used against you, when you apply for credit, insurance or employment? Thank the FCRA.

Negative information must be removed after seven years, or 10 years for bankruptcy, under the FCRA. And your employer or potential employer must get your written OK before they can get a peek at your credit report.

Last, if there is anything that's inaccurate in your file, you have the right under the FCRA to dispute it. The reporting agency must remove the information within 30 days after your dispute has been validated. There have been some rumblings that the credit reporting agencies drag their feet.

Fortunately, the new Consumer Financial Protection Bureau has just started overseeing the industry, and may help to speed up dispute resolution. It already monitors and helps resolve credit card, mortgage and bank complaints that consumers file. Maybe credit report disputes are next.

Follow me on Twitter: @JannaHerron

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