A Bill Was Introduced in the House of Representatives that Would Make the FCRA Less Consumer-Friendly 

By The Kim Law Firm, LLC

In October of 2025, the FCRA Liability Harmonization Act was introduced into the United States House of Representatives. The lead sponsor is Representative Barry Loudermilk of Georgia. Notably, the legislation, which has support from major creditors, debt collectors, and credit reporting agencies, would make the federal Fair Credit Reporting Act (FCRA) less favorable for consumers. This article covers what the bill would change and what the law still provides while it is only a bill; the credit report errors page covers how a claim works.

Background: The FCRA is a Fundamental Consumer Protection Law

The Fair Credit Reporting Act (FCRA) is the primary federal law that regulates the collection, production, and sharing of credit reports and related consumer information. As what is on your credit report matters, the FCRA is a foundational consumer protection statute. It helps to ensure that consumer credit information is collected, used, and shared in a proper (lawful) manner. 

Along with other things, the FCRA was enacted to promote accuracy, fairness, and privacy. It regulates credit reporting agencies, furnishers of information, and entities that access consumer reports. Notably, the law imposes affirmative duties to maintain reasonable procedures that ensure maximum possible accuracy and limits the purposes for which credit data may be obtained. 

Beyond that, the FCRA grants consumers enforceable legal rights. Some of the most important rights that you have under the law are the right to access your credit reports, dispute inaccurate or incomplete information, and receive notice when adverse actions rely on credit data. As the statute includes a private right of action, you can sue if you suffer damages due to an FCRA violation. 

The FCRA Liability Harmonization Act Introduced in Congress to Reform the Law

Key lawmakers are seeking to reform federal consumer protection law. The bill is called the FCRA Liability Harmonization Act. As noted, it was recently introduced in the House by Representative Barry Loudermilk (H.R. 5775). Among other things, the bill seeks to reform how civil liability works under the FCRA. Most notably, it would change the law’s class action provisions by placing caps on statutory damages, eliminating punitive damages, and limiting attorneys’ fees and total recovery amounts in class suits. The goal, as argued by its supporters, is to align FCRA liability standards with other federal consumer protection laws. 

Of course, not everyone supports the law. Indeed, the proposed reforms are very much unfavorable to the consumer. As currently drafted, the FCRA Liability Harmonization Act would weaken consumer protections. Consumer advocacy groups are clear: The reforms proposed in this legislation could allow large credit bureaus and data furnishers to escape real accountability even after systemic errors damage scores, lending, housing, or jobs. Critics also fear that limits on statutory and punitive damages and attorneys’ fees will deter lawyers from taking valid cases. Sadly, that could leave consumers who have been harmed without accessible remedies. 

An Overview of the Changes in the Proposed Bill (Unfavorable for the Consumer)

For consumers who are interested in making their voice heard, it is useful to understand some of the specific ways in which this proposed federal law would actually weaken the protections offered by the FCRA. Here is a more comprehensive overview of the proposed changes in the FCRA Liability Harmonization Act: 

• A Cap On Statutory Damages (Class Action): The FCRA Liability Harmonization Act would impose a hard cap on total statutory damages recoverable in class action lawsuits. Under current law, statutory damages in FCRA cases can range per plaintiff without a collective limit. Courts have the authority to award meaningful sums when widespread harm occurs. The proposed bill limits total class action damages to a fixed ceiling regardless of the number of affected consumers. The proposed change is bad for consumers because it removes the deterrent effect of uncapped statutory damages. When millions of people suffer similar credit report errors, a global cap means tiny per-person awards that do not reflect the scale of harm. Bad actors could treat the cap as a cost of doing business. 
• The Elimination of Punitive Damages for Willful Violations: The Act would eliminate punitive damages in FCRA class actions. Punitive damages punish especially egregious or reckless conduct and supplement actual and statutory damages. Current FCRA law allows punitive awards in willful violation cases, giving courts a tool to penalize companies that flagrantly ignore consumers’ rights. The proposed change is harmful because punitive damages serve as a meaningful deterrent against intentional or reckless violations. Without them, companies that repeatedly violate consumer rights may face only modest statutory and actual damages, even when their conduct harms many consumers deeply. The absence of punitive awards weakens accountability and reduces the consequences of willfully failing to follow the law.
• A Limit on Consumers’ Ability to Recover Attorneys’ Fees: Finally, the bill also seeks to put sharp limits on a consumer’s ability to recover attorneys’ fees through a successful FCRA claim. Under current FCRA statutory provisions, prevailing plaintiffs may recover reasonable attorney’s fees and costs. That matters because it makes it practical for lawyers to take on complex, resource-intensive class actions even when individual claims are small. Fee recovery is central to access to justice in federal consumer law. Capping or limiting attorney fees is bad for consumers because it undermines access to experienced legal representation. Complex FCRA claims require significant time and expertise. If lawyers cannot expect fair compensation, fewer will file class actions, especially for cases where individual damages are low. Consumers would face higher barriers to challenging systemic credit reporting errors. 

Creditors, Debt Collectors, and Credit Reporting Agencies Want to Limit Their Liability

Notably, the FCRA Liability Harmonization Act is not a favorable law for consumers. It narrows their ability to recover damages through a credit report error claim. Major industry groups are in favor of the proposed reform. For example, ACA International, which advocates for data collection agencies, has come out in support of the law. Further, the Consumer Data Industry Association (CDIA), which represents the major credit reporting agencies, is also in favor of the proposed law. Finally, the American Bankers Association has publicly expressed its support for the FCRA Liability Harmonization Act. 

What is Next: The FCRA Liability Harmonization Act has Many More Steps to Become Law

It is important to emphasize that this bill is not currently law. The FCRA Liability Harmonization Act is a proposed bill. After its introduction in the House of Representatives in October of 2025, it was referred to the House Financial Services Committee and the Judiciary Committee for review and debate. There are still many steps in the legislative process. Among other things, the committees may hold hearings, amend the text, and vote on whether to advance it to the full House. If the House passes the bill, it moves to the Senate for similar committee review and a Senate floor vote. 

Only after both chambers pass identical text can it go to the President for signature or veto. The process can take months or longer and often involves negotiation, revision, and lobbying from supporters and opponents. Even if passed by Congress, the President’s choice to sign, veto, or let it become law without a signature will determine its ultimate fate. Still, even though there is a long way to go, the FCRA Liability Harmonization Act does have some key support in Congress. It is also heavily supported by the creditors, debt collectors, and the credit reporting agencies. Consumers need to be prepared to make their voices heard as well. 

Key Point: The proposal does not change existing rights. As a consumer who has been subject to an error, your rights today are the same as they were before this bill was introduced. You can still obtain reports, dispute inaccuracies, and pursue claims under current law. Documentation matters. Written disputes matter. Pattern violations matter. Monitoring legislative developments helps, but immediate action protects credit standing today. Consumers can also engage in the process by contacting representatives, submitting public comments, or supporting advocacy organizations.

Why Credit Reporting Errors Remain a Systemic Issue

The unfortunate reality is that credit report mistakes remain a systematic and widespread problem. Indeed, reporting errors are not isolated events. They stem from automated reporting, high data volume, weak dispute handling, and fragmented responsibility between bureaus and furnishers. Errors often persist across multiple reports and resurface after deletion. Consumers bear the burden of correction despite limited access to underlying data systems. Any reform that reduces enforcement pressure risks reinforcing these systemic flaws. Accuracy improves when consequences are real. Compliance improves when oversight is costly to ignore. A high priority should be placed on consumer protection. 

You Can Take Action to Get Errors on Your Credit Report Corrected and Seek Damages

Were you the victim of a material error on your credit report? You have the right to take action to get the problem corrected and to seek financial compensation for any damages. Indeed, you can take direct action when your credit report contains errors. You should generally start by obtaining your full reports from all major credit bureaus. It is best to review each line item and to look for accounts that do not belong to you, incorrect balances, duplicate tradelines, outdated negative entries, or wrong payment histories. 

If you identify an error, you can and should submit a written dispute to the credit reporting agency. Notably, you may have a claim involving multiple (or all three) of the major credit bureaus. In submitting your written dispute, you should be specific. Along with other things, that means clarifying the exact information at issue and explaining why it is inaccurate. You should include supporting documentation. The FCRA requires the credit report bureau to conduct a reasonable investigation and correct or delete information that cannot be verified.

To be clear, the obligation does not stop with the credit bureau. Furnishers of information also have an independent duty to report accurately and to investigate disputes forwarded to them. Indeed, they must correct errors at the source. If they fail to do so, they are also in direct violation of federal law. You are not required to accept repeated “verified” responses that ignore clear proof. Pattern failures, form responses, and superficial investigations matter. They are evidence of liability.

Key Point: When a violation of the FCRA causes you any type of financial harm, you have the right to seek damages. The FCRA allows recovery for financial losses, emotional distress, and any out-of-pocket costs. In willful cases, you may also recover statutory damages and even punitive damages. Further, attorney’s fees may be recoverable through an FCRA claim as well. A credit report error lawyer can help you take action to pursue the compensation the law allows. 

The law today, until Congress changes it

A bill is not a law, and the remedies the proposal would cut — statutory damages for a willful violation, punitive damages, uncapped class recoveries — are all still in the Act as I write this. A consumer whose dispute came back “verified” with the proof ignored, or whose report was pulled without a permissible purpose, has the same claim today that they had before the bill was introduced. Keep the report before the dispute, the dispute and its delivery receipt, the result, and the report afterward. An FCRA claim must be filed within two years of the day you discovered the violation, and never more than five years after it happened. I review the file at no cost and bring these cases on contingency: you pay nothing unless we win. If the bill advances, I will update this page.

Admitted in Pennsylvania and New Jersey; available to appear pro hac vice in other federal courts.

Sources: FCRA Liability Harmonization Act, H.R. 5775, 119th Congress (introduced October 2025; text and status at congress.gov); 15 U.S.C. §§ 1681n, 1681o and 1681p (United States Code).