Financial Counseling Certification Program (FiCEP) Practice Exam

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Can credit reporting agencies (CRAs) block accounts at their discretion for identity theft victims?

Yes, always
Yes, but only with consent
No, it is prohibited
No, they may block accounts in certain cases

The correct answer is: No, it is prohibited

Credit reporting agencies (CRAs) have specific regulations they follow when it comes to identity theft and fraud. They are required to take certain actions to protect consumers who have been victims of identity theft. However, the ability to block accounts is not something that they have the discretion to do arbitrarily. In cases of confirmed identity theft, CRAs must block information from the victim's credit report if the victim submits a valid identity theft report. This means that while they can block accounts related to proven identity theft, they cannot do this on a whim or without appropriate documentation from the consumer. The prohibition stems from the need to avoid unauthorized interventions in a consumer's credit report. CRAs are bound by laws such as the Fair Credit Reporting Act (FCRA), which outlines their responsibilities and the process that must be followed when addressing identity theft. Therefore, the claim that it is outright prohibited is aligned with the need for CRAs to ensure that actions regarding credit reporting are not misapplied or misused.