The Federal Fair Credit Reporting Act, along with some state laws, limits who has the right to view your credit report and for what reason. If someone breaks the law by looking at your report without a legitimate purpose, you can sue for any money you lose as a result and possibly for more than you lost.
Legal Users
The Fair Credit Reporting Act identifies the people who have the right to view your credit report. The list includes you; businesses deciding whether to grant you credit; employers making job decisions; landlords and insurers you want to do business with; and various government and law-enforcement agencies. In many cases, you have to give consent before they can get the information. As of 2011, four states limit the right of employers to look up credit reports and similar bills have been proposed in other states.
Handling Information
The law also includes guidelines on what happens after someone checks your credit. If someone makes a negative decision based on information in your file -- to deny you credit, a job or an apartment, for instance -- she's required to tell you. She must also tell you the credit information that influenced her decision and provide contact information for correcting errors. These requirements can be waived: Employers who do their background checks in house, rather than hiring investigators, are exempt, for instance.
Finding Out
Even though it's illegal, it's possible someone can get your information when they're not authorized. Divorcing spouses, private investigators or nosy neighbors might all want to peek at your file. One way to check is to order an annual report from each of the three major credit bureaus, available free through the Annual Credit Report website. Your report will include all requests for your credit report made in the previous two years. Regular annual checks will alert you if someone's snooped who shouldn't have.
Penalties
If you discover someone has used your report illegally, you can file a complaint with the Federal Trade Commission. You can also sue the violator for damages equal to any losses you've suffered, or $1,000 -- whichever is greater -- plus attorney fees and court costs. You may be able to add punitive damages. The credit bureau can also file its own lawsuit. If the illegal action resulted from negligence rather than an intentional action, you can only sue for financial damages and court costs.
