The Federal Trade Commission (FTC) recently voted 5-0 to propose a rule that would require national consumer reporting agencies to offer free electronic credit monitoring services to active duty military members, implementing a provision of the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155).
The rule would require consumer reporting agencies to notify active duty military members within 24 hours of any “material” additions or modifications to their credit files. Reporting agencies may require a consumer to provide up-to-date contact information, appropriate proof that they are an active duty military member and proof of their identity.
It also details how military members can prove their active duty status, such as providing a copy of their active duty orders, and clarifies key terms such as “electronic credit monitoring service,” which the rule defines as a service through which reporting agencies provide, at a minimum, electronic notification of material additions or modifications to a consumer’s file.
Additionally, the proposed rule would prohibit reporting agencies from requiring active duty military members to agree to terms or conditions, or representing that consumers must purchase a product or service to obtain the free credit monitoring service.
The notice of proposed rulemaking seeks comment on these provisions and other aspects of the proposed rule such as:
- Are the restrictions on secondary uses and disclosures of information collected from an active duty military consumer requesting the credit monitoring service necessary?
- Are the methods used to verify appropriate proof of active duty military status adequate?
- Does the definition of “material additions or modifications” adequately cover the changes to a consumer’s file that should require notification?
- Is the proposed ban on marketing until after an active duty military consumer who has indicated an interest in obtaining the free credit monitoring service has been enrolled in that service necessary? Does it impose undue burdens on the CRAs?
The FTC is mandated to issue such a rule per S. 2155, which was signed into law in May. The FTC announced that it would accept comments through Jan. 7, 2019.