FRB: Amendments to Regulation V

ABA Contact: Nessa Feddis
Released: April 7, 2004 Federal Reserve
Published: April 12, 2004, 69 Federal Register 19123
Final Rule: June 15, 2004, 69 Federal Register 33281,
Comments Due: May 9, 2004
Disposition: Filed May 7, 2004


The Board has proposed to amend Regulation V that implements the Fair Credit Reporting Act. The Board proposes to add a model form to the regulation that financial institutions may use to comply with the notice requirement relating to furnishing negative information contained in the Fair and Accurate Credit Transactions Act of 2003. The Act requires that any financial institutions that extends credit and regularly furnishes information to a consumer reporting agency and furnishes negative information to an agency must provide a notice to the customer about the possible reporting of negative information. The notice may be included in any notice of default, any billing statement, or other material, but may not be included in the initial disclosure. The proposed language is: "We [may provide]/[have provided] information to credit bureaus about an insolvency, delinquency, late payment, or default on your account to include in your credit report."

ABA Comments

ABA generally supported the model language, but recommended simplifying it by deleting redundant and unnecessary words. In addition, it recommended that the FRB provide two model forms: one that would be appropriate as a general notice provided before the customer paid late and another that would be appropriate after the customer was actually late or in default.  It also asked for clarification that the consumer need only receive one notice: subsequent buyers of the loan would not be obligated to provide additional notices if one were originally provided to the consumer.


Final model language issued June 8, 2004. The Board, consistent with ABA's comments has provided two model notices: one for financial institutions wishing to provide the notice prior to furnishing negative information and a second for those choosing to provide the notice after negative information has been provided. The Board also simplified the proposed language consistent with ABA's comments. The Board did not issue clarifications of when the notice is required, but according to the statute, the notice must be provided anytime prior to reporting and up to 30 days after reporting. However, it may not be included in the Truth in Lending Act initial disclosures.

2004 Regulations Chart
69 Federal Register 19123, April 12, 2004
Final Rule: 69 Federal Register 33281, June 15, 2004
Comment Letter

Questions? Please contact Nessa Feddis for more information.