A Legislative Framework for Reducing Fraud in the Credit Repair Industry

Large computer databases collect and distribute information about the creditworthiness of most American adults. Businesses use this data to gauge the solvency of potential customers. Yet the information in these vast computer files is often partly or wholly inaccurate. Incorrect entries in his credit file may render a consumer unable to obtain credit until such information is deleted. Removing this data is often difficult and costly. In recent years a new industry has arisen to assist consumers in their efforts to correct inaccuracies in their files. Companies, in exchange for a fee, promise to improve a person's credit rating by challenging negative information that appears on her credit report. Unfortunately, instances of poor service and fraud in the credit repair industry are widespread, causing a rising tide of consumer complaints. As a result, several states have sought to regulate the activities of credit repair organizations, but with limited success. In this Article Professor Nehf claims that credit repair organizations have flourished because the Fair Credit Reporting Act makes it difficult for consumers to remove mistakes from their credit reports without outside assistance. He argues that in- stances of fraud would be greatly reduced if Congress would simply amend the Act to require better disclosure and simplify the labor that consumers must undertake to investigate and remove errors. Such a revision would reduce the need for consumers to seek assistance from credit repair organizations. Professor Nehf also argues that federal regulation of the credit repair industry is needed to combat widespread fraud; he then analyzes current state statutes regulating credit repair organizations in order to provide a legislative framework for reform

Recognizing the Societal Value in Information Privacy

Much has been written about database privacy in the Internet Age, most of it critical of the way in which the American legal system addresses the issue. In this article, Professor Nehf maintains that one of the fundamental difficulties with the public policy debates is that information privacy is often discussed as a typical consumer problem rather than a problem of more general societal concern. As a result, arguments over appropriate resolutions reduce to a balancing of individual rights against more general societal interests, such as increased efficiency in law enforcement, government operations or commercial enterprise. Although privacy scholars discussed the societal value of information privacy in the 1960s and early 1970s, the concept was not fully developed. More recently, political theorists have revived the idea and argue the importance of recognizing privacy as a societal norm. Professor Nehf adopts a functional analysis that compares information privacy to other societal values, such as environmental protection, and concludes that privacy policy could take a different form if the issue were viewed in this way

A Legislative Framework for Reducing Fraud in the Credit Repair Industry

Large computer databases collect and distribute information about the creditworthiness of most American adults. Businesses use this data to gauge the solvency of potential customers. Yet the information in these vast computer files is often partly or wholly inaccurate. Incorrect entries in his credit file may render a consumer unable to obtain credit until such information is deleted. Removing this data is often difficult and costly. In recent years a new industry has arisen to assist consumers in their efforts to correct inaccuracies in their files. Companies, in exchange for a fee, promise to improve a person's credit rating by challenging negative information that appears on her credit report. Unfortunately, instances of poor service and fraud in the credit repair industry are widespread, causing a rising tide of consumer complaints. As a result, several states have sought to regulate the activities of credit repair organizations, but with limited success. In this Article Professor Nehf claims that credit repair organizations have flourished because the Fair Credit Reporting Act makes it difficult for consumers to remove mistakes from their credit reports without outside assistance. He argues that in- stances of fraud would be greatly reduced if Congress would simply amend the Act to require better disclosure and simplify the labor that consumers must undertake to investigate and remove errors. Such a revision would reduce the need for consumers to seek assistance from credit repair organizations. Professor Nehf also argues that federal regulation of the credit repair industry is needed to combat widespread fraud; he then analyzes current state statutes regulating credit repair organizations in order to provide a legislative framework for reform

The Impact of Mandatory Arbitration on the Common Law Regulation of Standard Terms in Consumer Contracts

The doctrines of unconscionability and good faith have played para- mount roles in limiting the ability of businesses to impose unfair contract terms on consumers. Yet the continuing role of these doctrines is being threatened by the proliferation of mandatory arbitration provisions in con- sumer agreements. If this trend continues, the ability of courts to further de- velop these contract doctrines in consumer cases will be severely limited. The Essay begins with a discussion of the role that common law plays in regulating consumer contract terms and discusses how the unconscionability and good faith doctrines have evolved as limitations on unfair standard terms over the years. It then reviews the increasing use of mandatory arbitration clauses in consumer contracts and the likely effects of this trend on consumer contract litigation. The Essay concludes by exploring what this might mean going for- ward if the common law of unconscionability and good faith are essentially frozen in time, and if mandatory arbitration results in fewer published deci- sions interpreting and applying consumer statutes

The Failure of 'Notice and Consent' as Effective Consumer Policy

One of the central models for consumer protection in most countries emphasizes a notice and consent (or choice) approach--so long as the merchant gives the consumer notice of standard contract terms, and the consumer manifests assent to those terms, the terms are deemed to be binding. In this essay, it is argued that consumer advocates and policy makers should recognize that a notice and consent approach to standard con- tract terms is not likely to protect consumer interests in modern day contractual settings. Technological advances allow countless standard terms to be imposed on consumers in even the simplest transactions, and manifestations of assent are questionable in many cases. The essay explains why consumers quite rationally may manifest assent to terms and conditions that are not in their interests