FCRA Purpose, History and Preemption
Enacted in 1970, the FCRA was the first federal law to regulate private businesses' use of personal information. It mandates accurate, relevant data, gives consumers access and correction rights, and limits use of consumer reports to permissible purposes. Stricter state credit-reporting laws are generally preempted under FACTA.
The FCRA arose from the post-WWII rise in consumer credit, when individuals were harmed by inaccurate information they could neither view nor correct. Congress passed the FCRA in 1970, the first federal law to regulate the use of personal information by private businesses.
1996 amendments strengthened access and correction rights and added provisions for nonconsumer-initiated transactions (also called Prescreening). FACTA later amended the FCRA further, with identity-theft and other provisions.
State financial privacy laws related to credit reporting are generally preempted under FACTA, with specific exceptions (certain California, Colorado and other state laws discussed under FACTA). Do not assume stricter state credit-reporting laws survive.