FCRA Liability Harmonization Act

Bill Number

H.R. 5775

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Finance and Financial Sector

Status

Introduced

Latest Action

2026-06-30: Ordered to be Reported (Amended) by the Yeas and Nays: 27 - 23.

Last Updated

2026-07-02T13:05:04Z

AI-Generated Summary

Purpose of the Legislation

The FCRA Liability Harmonization Act (H.R. 5775) aims to standardize and limit civil liability under the Fair Credit Reporting Act (FCRA), a federal law that regulates how consumer credit information is collected and shared. Specifically, it introduces caps on damages and attorney fees in class action lawsuits (group lawsuits brought by multiple consumers) for violations of the FCRA, seeking to create consistency between individual and class action cases while reducing potentially excessive financial penalties on businesses.

Key Provisions

• Amendments for Willful Noncompliance (Intentional Violations):
• Under Section 616 of the FCRA, statutory damages (fixed amounts awarded without proving specific harm) for individual consumers are capped at the lesser of $100,000 or 40% of any actual damages awarded.
• A new subsection (d) applies to class actions:
• No minimum damages per class member.
• Total class recovery (excluding attorney fees) is limited to the lesser of $500,000 or 1% of the defendant's net worth.
• Attorney fees and costs are capped at the lesser of $100,000, 40% of awarded damages, or the actual fees/costs not exceeding those limits.

• Amendments for Negligent Noncompliance (Unintentional Violations):
• Under Section 617 of the FCRA, total recovery in individual cases (including actual damages) is capped at the lesser of $100,000 or 40% of actual damages.
• A new subsection (c) applies to class actions:
• Recovery is based on actual damages sustained by the class.
• Total class recovery (excluding attorney fees) is limited to the lesser of $500,000, 1% of the defendant's net worth, or actual damages plus capped fees.
• Attorney fees and costs are limited similarly to willful cases, not exceeding the lesser of $100,000 or 40% of actual damages.

These changes apply to lawsuits against entities like credit reporting agencies that fail to comply with FCRA requirements, such as accurate reporting of credit information.

Significant Changes to Existing Law

• Prior to this bill, the FCRA allowed statutory damages up to $1,000 per consumer for willful violations without caps tied to net worth or overall class recovery, and attorney fees could be uncapped based on court discretion.
• The bill removes unlimited potential for per-consumer minimums in class actions and introduces aggregate caps on total recoveries and fees, shifting from potentially open-ended liability to fixed limits based on damages or company size (via net worth percentage).
• It harmonizes treatment between willful and negligent cases by applying similar class action restrictions, which were previously less structured for groups.

Potential Impacts

• On Citizens (Consumers): May reduce the financial incentives for bringing large class actions, potentially leading to smaller overall recoveries for groups harmed by credit reporting errors (e.g., inaccurate information affecting loans or jobs). Individual consumers could still pursue claims, but group suits might be less viable.
• On Businesses: Credit reporting agencies and furnishers of credit data (e.g., banks) face more predictable and limited liability, which could lower legal costs and insurance premiums but might encourage stricter internal compliance to avoid suits altogether.
• On Government Agencies: Minimal direct impact, though the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB), which enforce the FCRA, may see fewer private class actions supplementing their oversight, potentially shifting more enforcement burden to them.
• On International Relations: None apparent, as the bill focuses on domestic consumer credit practices.

Main Stakeholders Affected

• Consumers: Primary beneficiaries of FCRA protections, but potentially disadvantaged by capped class action recoveries.
• Consumer Reporting Agencies (CRAs): Companies like Equifax or TransUnion, which could benefit from reduced lawsuit risks.
• Financial Institutions: Banks and lenders that provide credit data, facing lower exposure to FCRA suits.
• Attorneys and Law Firms: Class action lawyers may pursue fewer cases due to fee caps, altering the landscape of consumer litigation.
• Regulators: FTC and CFPB, indirectly affected through changes in private enforcement dynamics.

Notable Legal, Constitutional, or Political Implications

• Legal Implications: The bill alters the balance in consumer protection law by limiting statutory damages and class-wide remedies, potentially making it harder to certify (approve) class actions under federal rules (e.g., Rule 23 of the Federal Rules of Civil Procedure). It does not eliminate liability but emphasizes proportionality to actual harm or company size, which courts may interpret in future cases to assess "willfulness" or negligence.
• Constitutional Implications: No direct challenges noted, but caps on attorney fees could raise questions under the First Amendment (right to counsel) or due process if seen as overly restrictive on access to courts; however, such limits are common in statutes and generally upheld.
• Political Implications: Introduced by Republican representatives, it reflects a push for business-friendly reforms to curb what sponsors may view as abusive litigation under the FCRA, amid ongoing debates over consumer privacy versus economic burdens on financial sectors. If enacted, it could influence broader tort reform efforts in Congress.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Loudermilk, Barry [R-GA-11]

Cosponsors (7)

Rep. Wagner, Ann [R-MO-2], Rep. Fitzgerald, Scott [R-WI-5], Rep. Meuser, Daniel [R-PA-9], Rep. Kim, Young [R-CA-40], Rep. Huizenga, Bill [R-MI-4], Rep. Williams, Roger [R-TX-25], Rep. Moore, Tim [R-NC-14]

Recent Actions

• 2026-06-30: Ordered to be Reported (Amended) by the Yeas and Nays: 27 - 23.
• 2026-06-30: Committee Consideration and Mark-up Session Held
• 2025-10-17: Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-10-17: Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-10-17: Introduced in House
• 2025-10-17: Introduced in House

Bill Versions

• FCRA Liability Harmonization Act — issued 2025-10-17 — PDF (5 pages)