ANSWER:

Under FCRA, an adverse action notice must be provided to any consumer defined as an individual, including co-applicants (see 603(c)).

The notice may be provided in writing or orally or in electronic format.

The FCRA notice is required when adverse action is taken based on information in a consumer report.

For a covered transaction under FCRA, a notice must be provided if:

• adverse action is taken in whole or in part on information in a consumer report;
• consumer credit is denied or a charge for credit increased based on information obtained from third parties other than consumer reporting agencies bearing upon the consumer's creditworthiness, credit standing, credit capacity, character, general reputation, person al characteristics, or mode of living; or
• adverse action was taken based on information furnished by a corporate affiliate of the person taking the action.

When adverse action involves a consumer report in which a credit score played a role in the decision, the following are required, as applicable:

1. Section 615(a) notice (adverse action based on information in a consumer report;
2. Section 615(b)(1) notice (consumer credit denied or a charge for credit increased based on information obtained from third parties other than consumer reporting agencies;
3. Section 615(b)(2) notice (taking adverse action based on information obtained from an affiliate).

Reference: FCRA, Section 603(c), 615(a)(2) - (4), 615(b)(1) and (2); Federal Reserve Consumer Compliance Outlook, 2nd Quarter 2013